CHAPTER 3 – Insurance Marketing & Distribution (30 points)
Justabitof Insurance is considering to expand into State X. State X has open competition in very large
commercial lines ($500,000 in premium or more), but use and file on all other commercial lines. In
personal lines auto all rates are set by the state and for homeowners the rates are use and file. The
rating approval process for homeowners may change to pre-approval because it is a coastal state and a
number of insurers have increased premiums or cancelled accounts in coastal areas. Justabitof Insurance
sells personal lines and small business – its average commercial lines account is under $10,000. You are
in charge of marketing. The CEO has asked you to put together a recommendation of how you could
build a market for Justabitof’s products in State X. You are licensed in State X, but haven’t done business
there. You have no offices and no agents or producers licensed in State X.
1. Evaluate the type of insurance consumers you currently have vs the type of insurance consumers
you are wanting to obtain. Describe their insurance needs, knowledge, access, negotiating ability
& choice of financing alternative and what types of resources you will need to fulfill these
characteristics. (15 points)
2. Outline the marketing and distribution plan you would propose for the CEO’s consideration. (15
points)
