Minnows challenge giants online The Australian
At the moment, that is true -- Real Insurance's 200,000-strong customer base seems light when compared with IAG, which owns NRMA Insurance, CGU, SGIO, SGIC and Swann Insurance.
But as Virgin Money Australia managing director Matt Baxby points out, "Virgin never enters a market thinking it is not going to make an impact and companies like Progressive wouldn't be making large investments in the country unless they thought there was a real opportunity".
Mr Grobler says, in the long term, the new players "pose a huge threat for a few reasons".
"One is consumer behaviour is moving quite rapidly on to the internet and I think the new players are a lot stronger in terms of putting competing propositions on to the internet," he says.
Mr Baxby says online car insurance sales represent 5 per cent of the total market in Australia whereas in Britain it accounts for 40 per cent, so there is big potential for growth.
In response, Suncorp has launched Bingle Insurance and IAG has created The Buzz -- their takes on the cheaper, online insurer.
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