Toward the end of the session, Debbie will talk about an important element of the program – a sort of on-line report card the parents receive, showing their young driver’s progress.
Bill will jump in at that point. He’ll explain the program in a bit more detail, along with some updates we’ve made to improve Teen Safe Driver’s effectiveness and customer appeal. Bill will also share some metrics on the program’s success. I’ll then conclude the presentation and then we can open it up for questions.
American Family is a multi-line insurance company, Fortune 400 company, selling auto, homeowners, commercial, farm/ranch, life and individual health insurance in 18 states. We also sell variable products and annuities. The company that later became American Family was founded in 1927, specializing in auto insurance for Wisconsin farmers. We have expanded significantly over eight decades, dipping a toe in the Pacific Ocean in 1998 when we entered Oregon and we will dip another toe, in the Atlantic Ocean this time on January 1 when we start doing business in Georgia.
Along the way we’ve grown beyond our original customer base to probably serve people from all walks of life. People rely on us for a lot more than just their car insurance. We’ve been a mutual insurance company for our entire existence, which means that our customers are our owners and we exist to meet their needs rather than the needs of Wall Street.
American Family and our exclusive independent contractor agents help our customers manage many of life’s uncertainties and turning the car keys over to a young driver for the first time is definitely one of life’s uncertainties.
The insurance industry is highly competitive, as we all know. Even under normal circumstances, insurance companies compete for market share, for market segments and for profitable business. Our current economy is not what you’d call ‘normal’ circumstances right now. As economic activity has slowed down, the quest to acquire and retain customers is even stronger. One of the ways to attract and retain customers is to demonstrate a higher degree of value from the customer’s prospective. Insurers can do that in a lot of ways: by improving customer service -- and everybody’s trying to do that -- controlling costs or expanding opportunities for doing business on the Web.
In evaluating the potential of Teen Safe Driver, American Family came to the conclusion that we could strengthen our relationships with our customers while at the same time address a critical public safety issue. Teenage drivers are at a much greater risk of injury or death in their first few years behind the wheel. They are involved in more auto accidents than other age groups as a result, obviously, of their inexperience behind the wheel and their inability to manage distractions, things like cell phones, sound systems or interactions with other passengers in the vehicle.
Let’s consider these statistics. According to the Centers for Disease Control and Prevention, motor vehicles crashes are the leading cause of death for teenagers in the United States, accounting for 41% of teen fatalities. This is more than the next four causes of death, combined: homicide, suicide, other kinds of accidents and cancer. The Journal for Safety Research has determined that teens are nine times more likely to be in a car crash than their parents; the crash rate increases 700% when teenagers drive without one of their parents in the car.
The National Highway Safety Administration came up with these numbers for the year 2006. 12.9% of all drivers in fatal crashes were between the ages of 15 and 20. By comparison, those ages represented only 6.3% of all licensed drivers. So, you get the picture: our young drivers across this country are dying at a rate that is simply unacceptable.
These are compelling statistics. But equally compelling is actual footage of teenagers behind Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11