The date April 12 will forever be significant to travel insurtech company Squaremouth.
On that day in 2020, as the coronavirus pandemic halted travel around the globe, the travel insurance comparison company hit an all-time low since its founding in 2003, earning just 12 sales in one day.
While 12 sales were meager compared to the 500 per day Squaremouth was averaging pre-pandemic, it was those 12 purchasers who kept the company in business that day – and who helped Squaremouth keep morale high in such uncertain times.
Cut to April 12, 2022, and Squaremouth is seeing an estimated 1,200 sales per day as travel rebounds from the crisis. As a thank-you, Squaremouth announced yesterday – exactly two years on from 2020 – it was gifting $1,200 to each of the 12 travelers who helped the company stay afloat.
Of course, weathering two years of a pandemic takes much more than accommodating 12 customers. By finding new customers and creating new products – all while keeping a full staff at full pay – Squaremouth was able to bounce back from a 90% decrease in business to sales projected to supersede pre-pandemic numbers by more than 200%.
Megan Moncrief, chief marketing officer of the female-led company, says Squaremouth’s number-one priority when the pandemic hit was its employees and their livelihood.
Even though sales were dwindling, Moncrief says the company cut as many costs as it could – including selling the property of its future headquarters – instead of cutting the salaries of its then-37-person staff.
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“We knew we would never be able to support our customers or succeed in a post-pandemic world without our full staff,” Moncrief says.
Maintaining financial transparency – including salaries as well as sales figures - was vital to Squaremouth’s operations, she continues.
“Anyone at our company can look up our sales. We knew the situation was dire, but we didn’t want internal panic. We discussed our finances during weekly company meetings and worked to ensure every employee knew where we stood, and what we were doing to reserve funds,” she says.
“Ultimately, this transparency during our lowest point motivated us all to work harder, together, in order to meet one goal: company survival. As a result, we are a closer and more successful group today.”
Another key to withstanding the pandemic was to rely heavily on Squaremouth’s technical capabilities to find new revenue streams.
Moncrief says Squaremouth has always operated like a software company rather than an insurance company, which “ultimately allowed us to survive throughout the pandemic.”
“Squaremouth is built on innovation. Ninety-seven percent of our sales come from our website, without any interaction with the customer. For this reason, it is vital our digital experience matches that which customers would receive over the phone when speaking to one of our licensed agents,” she says.
“We use that same mindset in terms of developing products. We use our data and expertise to create products that serve the current and future needs of travelers.”
Indeed, the needs – and makeup - of travelers have changed due to COVID-19. The average age of Squaremouth’s customers dropped by 10 years compared to pre-pandemic times, meaning an entirely new demographic is buying travel insurance, either because they want to be better prepared or because their destination requires them to have a policy.
We knew we would never be able to support our customers or succeed in a post-pandemic world without our full staff.
Megan Moncrief - Squaremouth
“As our customer demographic and traveler concerns have shifted, we worked with our underwriters to bring new products to the market that meet the new and evolved needs of our customers brought on by border closures and destination requirements. For example, products geared to domestic travel, benefits for pandemics and increased coverage limits for events such as an unplanned quarantine abroad,” Moncrief says.
“While these were never top-of-mind prior to 2020, they are now the driving force behind today’s travel insurance consumer,” she continues, adding that the marketing team’s strategy has also shifted to partnerships, which allows Squaremouth to work with brands to explain the complexities of travel insurance.
As a result of these efforts, Squaremouth surpassed pre-pandemic sales levels by summer 2021, finishing up the year 49% over 2019 and more than 200% compared to 2020. In 2021, it also sold the most premium in the company’s history.
This year, Squaremouth sales have more than tripled, up 272% from the same period in 2021.
Beyond the 12 customers that stuck with the company at its lowest point, CEO Jessica Burns says Squaremouth is seeing unfamiliar customers coming to travel insurance because they have “new and very real concerns.”
“Before, people bought travel insurance for the ‘what-if’ scenarios. Now, they’re buying it because they’ve already been impacted and want to be protected if it happens again.”