Assignment 12A: Figuring Out Buyer Behavior No. 1

Segment: The segment I chose is drivers of all ages. Particularly, I want to focus on high school seniors, teens obtaining new license, and drivers who received a DUI violation.

Interviews: The three interviewers were my consumer targets, and they all believed that it would be beneficial are actually enthusiastic about the program. They believe that it would overall help insurance rates and risks.

Need awareness: The need awareness is when an accident occurs, because knowing about insurance more may affect better judgment, or when a driver’s policy goes through renewal. Ultimately the goal is to have a safer driving environment and lower insurance rates.

Information search: When there is a policy rate increase, most people would call their agents or insurance companies and complain to them. Moreover, some people even cancel policies and shop around, only to have the same issue elsewhere eventually. Some people actually go on Google to find out why this occurs, but it’s rare that they believe it.

Findings & Conclusion: What I learned about the interviews is that most people although may not see the need right away for insurance education, they eventually believe that it would ultimately result in better driving habits and a better understanding of how their actions impacts their insurance rates. This need isn’t really a “need” until these people experience rate increases, which does not happen until later. All in all, all people have needs to have their insurance rates lower, because who loves paying more money, right?

Assignment 13A: Reading Reflection No.1

13A Reading Reflection No.1

1) You read about an entrepreneur:

·        What surprised you the most?

The thing that surprised me the most was how talented and driven Chanel was despite the circumstances and how the society was back then. In addition to that, I had always thought she was just a fashion designer, and never knew about her struggles and her obstacles for her to become who she is known as today. Chanel was very smart, talented, and is considered an idol on how she revolutionized fashion. In addition to that, I never had known that she struggled with drugs and she had a German significant other during World War II.

·        What about the entrepreneur did you most admire?

The thing about Chanel that I most admired was how she revolutionized fashion and became a muse and becoming the century’s most celebrated artists. Chanel never had hopes and dreams so far that her name and her company would be like it is today, she was just pursuing her passion. In addition to that, no matter how many hardships she went through with drugs and the war, she did not let that stop her from becoming successful and pursuing her dreams.

·        What about the entrepreneur did you least admire?

The thing I least admire about Chanel was her affairs and her drug habits. There wasn’t too much in the book since the author didn’t go in too much depth with some details.

• ·        Did the entrepreneur encounter adversity and failure? If so, what did they do about it?

The biography didn’t go into too much detail about her failures and how she dealt with it. The biography states the struggles Chanel goes through and how she would just keep working and find opportunities to develop herself to create fashion pieces.

2) What competencies did you notice that the entrepreneur exhibited? 

The competency that the entrepreneur exhibited is the ability to strive and be focused on your goal. She is completely hard working, talented, and self-driven. No matter what the obstacles were and what the circumstances were, she would always try to find a way to achieve her goal. She is great at sewing and creating fashion pieces.

3) Identify at least one part of the reading that was confusing to you.

One part of the reading that was confusing was that, sometimes the author did not relay or do a great job at providing some historical information that would have been relevant to the time. She slightly mentioned it, but I felt like it wasn’t enough for me to understand some things completely.

4) If you were able to ask two questions to the entrepreneur, what would you ask? Why?

The first question I would ask her is: what was the biggest thing that kept you going although there were obstacles? The reason I ask this is because I think it would be helpful to entrepreneurs out there. Things are bound to happen, and people often become discouraged, therefore, it is nice to have an insight on how to deal with it.

The second thing I would ask her is: Is there one thing you wished you had done differently? The reason I want to know this is because she has such an interesting story, so I just wanted to know how different she would be now compared to the person she was before.

5) For fun: what do you think the entrepreneur's opinion was of hard work? Do you share that opinion?

I agree with her opinion of hard work. Chanel showed nothing but determination and drive, which results in the person or the “brand” she is today. 

Assignment 11A: Idea Napkin No.1

1)     My name is Michelle Hawkins, and I am a senior majoring in Economics. I have a talent in problem solving and focusing for long periods of time. In addition to that, one of my skills unrelated to business is golfing. I used to play college golf before transferring to UF. My dream is to become a professional pilot. The reason I decided to major in economics is because I love the idea of improving society and our economy. Regarding my business concept, I feel like this business would play a great role in my life once it has started. This is because I also personally own a vehicle, and no matter what, I would be affected by insurance rates.

2)     I am offering to educate consumers about how insurance works and how it affects an individual’s rates. Drivers nowadays are experience rapid rate increases and are upset about the situation, unaware that a big reason why this occurs is due to their driving behavior. Most drivers are unaware that their claims will eventually impact the entire area, resulting in a rate adjustment. By providing services such as a mandatory lesson prior to obtaining a driver’s license, for when drivers obtain a DUI, and a bootcamp for students before graduation, will raise awareness and will decrease the numbers of reckless drivers.

3)     The people I will be offering this to are drivers in every state and high school seniors. This isn’t specific to anyone, unless that person obtains a DUI. What all my consumers have in common are the interest in driving or interest in saving insurance rates.

4)     People will not care at first because are not aware of what they are going to learn about. They will not have a choice but to take the course, but eventually will end up learning about the impacts of their driving habits and will result in improving them in order to save money on insurance.

5)     The core competencies and the things that specifically sets us apart from everyone else is that we would have insurance professionals and experts working for us. In addition to that, we will be obtaining our information from insurance companies, actuaries, and economists to provide the most accurate data. In addition, we provide online courses through our website, and we hold boot camps every year to seniors at every high school.

I feel like these elements fit together and the aspects of my business. Some aspects of my business concept are weaker or out of joint with the others. I would need to find specific people who would be able to find data and find insurance companies to work with. Those things would be slightly difficult, but not impossible to conquer. 

Assignment 9A: Testing the Hypothesis, Part 2

Who: For my assignment, there are some people who falls outside of my market or will not become affected by my “opportunity” or the opportunity does not impact those individuals. These people include drivers who are only listed on a policy, and do not pay for their car insurance. These individuals are not aware of rates or sometimes, their coverage. The last group of people are ones who do not own vehicles. These particularly applies to those residing in large cities with great public transportation system such as New York City and Washington DC. The majority of this population do not drive vehicles and heavily rely on trains, cabs, and walking to their destinations. In addition to that, some of them do not even have a driver license because they never need it.

I interviewed one person who stated that some high school students and college students do not know much about their insurance policies, yet even the cost of it due to the fact that they are covered under their parents. Their parents would bet the ones concerned about this issue, rather than the directly. If their parents cancel their policy due to rates, they just hear about it, but are not upset about it because they are not the ones paying. Two interviewees state that people with no vehicles do not understand the insurance rates because they never had to experience with this issue and have no insurance bills a month. Two interviewees stated people will drive recklessly no matter what, and they haven’t experienced an insurance rate increase.

What: It was mentioned by two interviewees that people will drive recklessly no matter what they know about insurance since it is in human nature to be rebellious and sometimes selfish. Some people do not feel the need to learn it or change their driving habits because they are not affected by it (eg drivers without cars, people with same premiums)

Why: The need is completely the same for the outsiders. This is because people can be told information, but may not learn from it. There needs to be a desire to get the issue resolved.

Inside the boundary Outside the boundary
Who:   Drivers being affected by the increase.                  Drivers having the same insurance rates
Drivers getting in claims                                                       People without vehicles

What:                Reduce accidents and claims                 Eliminate claims
Reduce upset policyholders                    Eliminate rate increases
Why: People being rebellious
         People unaware of consequences of filing claims towards others

Assignment 8A: Solving The Problem

Solving the Problem

My opportunity has to do with car insurance companies having to increase their rates due to losses and inflation, but people are upset with the increases. Insurance companies increasing rates is something that needs to be done to maintain the balance between losses and revenue. This act obviously affects people; however, we can minimize and try solving this problem as best as we can.

Solving this issue is mainly revolved around educating consumers about the reasons why the rate increases occur. Educating the public that increases are due to inflation and claims can minimize rate increases. It is true that inflation is something we cannot control but having so many claims filed can be controlled. By educating people of this reasoning, will help them be conscious about their driving habits, therefore, accidents will not occur. This also provides a feeling of “working together”, and motivation for drivers to make better judgement calls while driving. (Decrease in claims = Decrease in insurance rate). 

Some of the things we can implement to educate potential drivers or anyone that has a driver’s license includes:

• Having this information relayed in a driving test for first time drivers license. We all had to take the drug and alcohol 4-hour online course prior to obtaining our license. Implementing this additional course would be beneficial so drivers learn about insurance and its effects prior to being on the road. This course would be sold to all DMVs for every state, making it a requirement to take.
•  This point links to the DMV obtaining this information. Drivers who are arrested due to DUI should be required to take a course.
• Implementing a seminar or a one day “boot camp” for high school students to be taught about insurance and its effects. There will be an examination towards the end of the day in which all high school seniors are required to pass prior to graduation. This product or service will be sold and offered through the DMV, a certified driving school, or through the school district.

The ideal way of providing these products and services would be through a company specializes in these practices. Having people access their website to take these exams would be ideal. The DMV and the school district would just refer their students and drivers to the website. For the "boot camp", materials would be provided for the DMV, a certified driving school, or the school district. 

Some people may believe that by providing this education, it will be useless anyways since there will still be people who will drive recklessly. However, some people who drive recklessly are not aware that they are affecting others with their driving habits. There will be some drivers who learn about these things and change the way they drive. Of course, it is impossible to completely transform a driver based on educating them, but it will absolutely bring the numbers of reckless drivers down. 

7A – Testing the Hypothesis, Part 1

Car insurance companies must increase their rates due to losses and inflation, but people are upset with these increases.

Opportunity: Car insurance companies are forced to increase their rates due to inflation and losses that the companies are impacted by, however, drivers believe that being claim free and over a certain age, they are safe from these increases.

The Who: Licensed drivers over the age of 16.

The What: License drivers are being hit on high rate increases

The Why: These rate increases are done to compensate the losses and inflation rates that have affected the area and the insurance companies

Testing the who: Every licensed driver in the world at one point has experienced a rate increase on their policies, even though they are claim free and are over a certain age. Inflation occurs everywhere in the world; therefore, the cost of living is not as cheap as it used to be. Some drivers may not be paying for their own insurance since they may be under another person’s policy, but the person who is paying for the insurance will become affected. This might not be the case if these people are uninsured. But specifically, in the United States, it is illegal not to have insurance, so we can assume almost everyone in the United States who is a licensed driver is affected.

Testing the what: There may be some boundaries to this test, because people may want insurance companies to justify their impacts, but insurance companies will never present their numbers towards the public. Licensed drivers who are not paying for their insurance since they are listed under another person’s policy will not become affected by this issue. Another issue is that most insurance companies who have obtained a “new business”, or new customer, they will be more than likely to give them a big “new business” discount for their first term, where customers are not aware of, therefore, they believe that another company is giving them a better deal, or that they are safe from rate increases.

Testing the why: Rate increases are necessary for insurance companies to stay in business. There are more cars in the roads, leading to more accidents and risks. Insurance companies are paying out so much that if they do not increase their rates, they would go bankrupt. In addition to that, inflation causes everything to become much more expensive. These things include the cost to repair a vehicle, such as labor and car parts, medical costs etc. Especially with newer vehicles, having a higher skilled worker is required to fix the vehicle, therefore the cost of labor will increase. Lower skilled workers are unable to change new cars since they may not be familiar with the new sensors, backup camera, new electrical system, etc.

Interviews:

·        My first interviewer was my 70-year-old neighbor, he is upset that his insurance rates have increased last month after renewal. He stated that he has been a loyal customer for years and is offended that his insurance company is forcing him to pay more because of other people’s accidents. He stated he called the insurance company to complain, but they told him about inflation, but he didn’t think it was a good answer since he got a better quote with another company. He ended up cancelling because another company got him a better quote.

·        My second interviewer was actually a co-worker of mine, she is in her 20’s and has worked in insurance. She informed me her insurance went up this year, and she is not actually upset about it. She understands the situation behind the issue, and that she felt like she didn’t want to keep switching companies because she knew it was going to eventually increase if she switches. She did mention that it would be nice of insurance companies only penalized the people involved in these claims, but they already do penalize them for that. Most of the time, these people end up cancelling because they do not want to pay these surcharges, therefore, the company would end up having to increase their rates anyways.

·        My third interviewer is also a neighbor of mine. She is a woman in her early 60’s, and she believes that her insurance company is the best! She told me that all her friends have been complaining about their huge insurance increases, whereas her premium only slightly went up. She mentioned she was going to stick with this company and believes other insurance companies are just ripping people off on purpose.

·        My fourth interviewer is my classmate. He is in his early 20’s and mentioned that his insurance rates are very high. He completely understands though, since he is under 25, his rates are going to be high since he is a bigger “risk”. He mentioned that insurance companies probably shouldn’t assume every 20-year-old is the same, and that they should be personally analyzed and observed, including driving records, to give them the best rate. He thinks that insurance companies only have the desire to rip people off.

·        My fifth interviewer is one of my good friends who lives in South Florida. She stated in the beginning she was very upset that her insurance rates went up after Hurricane Matthew and did not want to be penalized for others filing a claim. She decided to stay with that company because she didn’t feel like going through the process of setting up a new policy. However, she stated she had a change of heart ever since Irma hit Miami. She told me she now understands that had her insurance never went up, the company may not have been able to pay for the damages that occurred after Irma.

After interviewing everyone, I realized how upset people get and how much insurance rates really affect an individual. I believe that mainly it is because having car insurance is so important, and people are trying to find the best rates possible to fit their lifestyle. Most of my interviewers view insurance companies are “scammers” and they are out to get their money. Some of them provided me with ideas that they think would be beneficial, such as my fourth interviewer. It was nice to learn from my second interviewer, since she had insurance experience and gave me the peace of mind that not only people who file claims are paying the rate increases, but they are also paying an accident surcharge. Lastly, my fifth interviewee gave me another perspective of insurance companies after natural disasters. At first, herself believed that the company just wanted they paid for back, however, they had to increase their rates in order to protect not only their company, but you as an insurer too. 

Assignment 6A: Identifying Opportunities in Economic & Regulatory Trends

1)     Black unemployment spikes to 7.7%, up from record low

https://www.cnbc.com/2018/02/02/black-unemployment-spikes-up-from-record-low.html

(Economic Trends)

Found on CNBC, I believe in this opportunity because the statistics were pulled from the Bureau of Labor Statistics. This opportunity exists because of the statistics presented (7.7%), the unemployment rate increased from all time low to 7.7%. I believe that there is an opportunity for this trend to increase in percentage if the issue is not resolved. The customer with this opportunity would be people of color, minority, or those residing in those areas or who are going through the same situation. This opportunity would be hard to exploit, because it affects the entire economy and a large population, many things are also affecting the unemployment rate. Many issues need to be resolved to bring the rate back down.

I saw this opportunity because I believe that everyone should have equal rights and equal employment opportunities in this country. Although there isn’t anything specifically that is personal to me regarding this situation, I strongly believe in solving this issue in order to improve our country as a whole.

2)     China’s Middle Class Is Pulling Up the Ladder Behind Itself

http://foreignpolicy.com/2018/02/01/chinas-middle-class-is-pulling-up-the-ladder-behind-itself/

(Economic Trends)

Found on Foreign Policy, I believe this in this opportunity because they were able to present specific data. The opportunity exists because data and examples were able to be backed up from their “point” or subject. I believe there is an opportunity for lower class people in China, since the rural poor are increasingly not welcomed in China’s big cities. The middle class would be well better off, but the lower class would not. The people with the opportunity would be middle class families and lower-class families. This opportunity is somewhat hard to exploit, but may help encourage lower class families become motivated, but would be hard to exploit because the lower-class families are so far behind that this may be an issue.

I saw this opportunity because looking at other countries, they are able to empower themselves and bring their class up, therefore it is important for me to see that this is something our country should be trying to do as well, not only for the middle class, but for the lower class too.

3)     Florida lawmakers changed ‘stand your ground’ law. Chaos followed.

http://www.tampabay.com/news/courts/criminal/Florida-lawmakers-changed-stand-your-ground-law-Chaos-followed-_165038900

(Regulatory Changes)

Found this on Tampa Bay, I believe this is an opportunity and it exists because law enforcements and government officials have conducted and implemented the new law. Floridians who have the desire to protect themselves are exposed to this opportunity. I believe that this opportunity is hard to exploit, simply because many individuals have different opinions and views towards owning guns, mainly because of issues that have aroused with gun usage.  

I saw this opportunity because I live in Florida and believe that knowing about our new implemented laws is very important, especially something as serious as this. Regardless of my views towards guns, it would be useful to highlight this opportunity or be aware of law changes like these.

4)     New cryptocurrency rules just came into effect in South Korea

https://www.cnbc.com/2018/01/29/south-korea-cryptocurrency-regulations-come-into-effect.html

(Regulatory Changes)

Found this opportunity on CNBC, I believe this an opportunity and it exists because it was announced by South Korea’s Financial Services Commission on Tuesday. This opportunity is going to be exposed to all Koreans, and anyone who is looking to transfer money or funds or do business with anyone in that country. This implementation is meant to prevent illegal activities. I believe this opportunity can be exploited, because this would take effect for the entire country, making it almost impossible for anyone to avoid this new cryptocurrency rule.

I saw this opportunity because I believed it was very interesting to see why these laws were implemented, and what effects it has shown. Although I never personally have dealt with this situation, I know that there are people who download things illegal or purchase illegal things via bitcoin online. This rule is going to help prevent these transactions from occurring, and perhaps one day the Untied States will implement something like South Korea.