Ever since the Care Bair and Company shot down Wal-Mart's attempt to enter the financial services business through the front door, the retailing behemoth has been charging full speed ahead through every side and back door it can cut into the wall, including foreign banking, store-based, check-cashing money centers, micro-lending, money transmission, and prepaid debit cards. The latest door opens into the insurance business.
The nation's largest retailer said Wednesday it is partnering with AutoInsurance.com to provide customers with "a one stop shop" for their auto insurance needs.
Wal-Mart will not sell insurance, but its customers can click through a link on walmart.com, or go to autoinsurance.com directly to get competing quotes from several car insurance providers such as Progressive, Esurance and Safeco to choose the policy and price that best fit their needs. Wal-Mart will also promote the service via displays in its stores.
Wal-Mart said the service will save customers money. The company cited a pilot program survey it conducted last year in Pennsylvania, where customers who purchased policies from autoinsurance.com on average said they saved $1,168 a year.
"We are always looking for ways to reduce complexity, increase transparency, and give everyday low prices to Wal-Mart shoppers," said Daniel Eckert, Wal-Mart's senior vice-president of services.
Eckert also stressed the simplicity of the site, which is able to retrieve information from a customer's current policy and automatically fill in most of the necessary coverage information.
Much of Wal-Mart's financial service offerings are targeted at people who do not have access to bank accounts, because they either cannot afford the high fees, or do not have stable enough jobs to be able to keep a minimum balance.
The federal banking regulators claim to be focused on encouraging banks to find ways to "bank the underbanked," while simultaneously driving many of those who do service those folks, or who service the businesses that service the "underbanked," out of the business.
As we speculated five years ago, Wal-Mart may have "dodged a bullet" by not owning an industrial bank." Free of the gentle ministrations of an overseer who knows what's best for the consumer, especially the fog-brained poor, Wal-Mart seems to be able to give the underbanked what they want, rather than what the Nanny State decides they need.