Startup of the Week: Margo Is Changing How We Shop for Insurance

If dealing with big insurance providers is your least favorite thing, meet Margo.

In 2015, the auto insurance industry alone collected about $200 billion in premiums from U.S. drivers, according to the National Association of Insurance Commissioners. While top carriers like State Farm, Geico, Allstate, and Progressive already face the looming threat of safer cars, they’ll need to look out for small, growing companies like Margo, too. The Philly-based insurance startup, which formally launched in August 2015, wants to transform the insurance market by tapping into the power of exceptional customer service, which they say large insurance carriers lack.

“The problem with insurance is that it’s something everyone needs, and the big carriers have taken advantage of that,” says Taylor Burke, Margo’s director of marketing and communications. “They haven’t created a product that works for consumers because they know consumers will buy it no matter what.”

The startup’s customer service model is simple: It acts as an agency for a range of carriers. Any customer who calls Margo will be set up with what the company calls an “insurance advocate” — think of them as that friend who helps you stand up to bullies. Once you have a conversation with the advocate about your needs, they’ll shop around to find a low-cost policy that meets your home, auto or renters insurance needs. They then even help customers purchase the plan through their system, an important step that sets them apart from insurance comparison engines like The Zebra. With Margo, once a customer files a claim, they’ll never have to communicate with an insurance carrier again.

The company’s assistance is completely digital — all documents are signed with an e-signature — so customers no longer have to worry about those dense insurance policy packages. Margo says it’s committed to ongoing customer support, so if any issues arise with your policy down the line, they’ll be there to work it out with the insurance carrier on your behalf. When it’s time to renew a plan, the advocates will be there to explain your policy’s new terms or shop around again if need be.

Though Margo doesn’t market itself as insurance for millennials, the company’s services suit the millennial lifestyle. Customers don’t ever have to visit an insurance office to meet with agents face-to-face, and unlike online services like esurance, Margo isn’t linked to any one insurance provider. The lack of ties is how the insurance advocates say they build trust with customers.

The advocates, most of whom were previously agents at big insurance companies, have found that customers are disillusioned by the insurance process or have felt cheated by past insurance plans.

“We find that people are overpaying for things they don’t need, or in some cases they’re under-covered,” says Cody Thompson, an insurance advocate who worked as a State Farm agent for nearly a decade.

The company says it has experienced a lot of growth over the last few months and is positioned to expand service to customers outside of Pennsylvania. And while they’re positioned to reach 1,000 customers by the end of the year, they’ve found that insurance is still something most people aren’t excited to talk about.

But the company has every incentive to reel more people in and keep them satisfied: They earn a commission from every insurance policy they sell and must constantly vie to keep the agreements they’ve made with those same carriers that they’re competing against.

Zach Robbins, a native of South Jersey and graduate of Temple and Rowan Universities, started Margo after being around the Philadelphia’s tech scene for over a decade. He’s also the founder and CEO of the Philly-based online marketing company Leadnomics, which he’s run since 2007. Margo currently shares a building and services with Leadnomics.

“When people think of insurance, we want Margo to come to mind and not just Geico and Afflac,” says Robbins. “So right now it’s been about figuring out how to optimize the business before adding fuel to the fire.”

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