Did you hear about Allstate? The property and casualty insurance giant reports it has agreed to acquire privately held Squaretrade, which sells warranties for electronic products, in a deal worth about $1.4 billion. Maybe Allstate can insure your smartphone!
According to an official corporate news release issued by Allstate: Allstate’s consumer-focused strategy of providing unique products will be further enhanced with the acquisition of SquareTrade. This acquisition expands Allstate’s customer relationships with 25 million protection plans for consumer electronics and connected devices. Headquartered in San Francisco, SquareTrade protects mobile devices, laptops and tablets, and other consumer electronics and appliances from malfunctions, accidental damage.
According to the Wall Street Journal, SquareTrade has been a disruptive force in the insurance sector because of its online sales model, pricing and the information it provides about failure rates of products. It was originally launched in 1999 as a website that mediated disputes between eBay buyers and sellers. The deal is pending regulatory approvals, among other closing conditions.
The deal, which will help Allstate expand into new markets and products, is expected to close in January.
In an article published by ChicagoInno online, it seems apparent, with this major acquisition, Allstate wants to insure gadgets. ChicagoInno reports the acquisition represents a big tech move by Allstate, which in Chicago's Merchandise Mart earlier this year. SquareTrade works with retailers like Amazon, Costco, Sam's Club and Target to help insure things like mobile devices, laptops and tablets with protection plans.
What does Allstate's tech move figure?
In TechCrunch's Why the recent hype about insurance tech will be just the beginning, it appears the rise of the mobile workforce, as well as the mindset of millennials and the escalation of the Internet of Things (IoT) and wearables have disrupted the insurance segment with new opportunities for a new age. Overall, as TechCrunch observes, traditional carriers have an important role to play in improving insurance for consumers, with many already advancing steps to improve their processes, as well as expand their relevant offerings for the digital age.