Progressive Corp., the country's fourth-largest underwriter of auto insurance, has become the first major U.S. insurance firm to let customers do business with it through Web-enabled wireless phones.

The Mobile Progressive service lets people whose cellular telephones are equipped with Internet browsers use the Progressive Web site to find a local insurance agent, file a claim, get a price quote, and check or modify a policy.

This means, for instance, that someone who gets into a car accident can report it instantly from the scene.

"We targeted the Web-enabled phone because it's the hottest sector in the market," said Fred Khoury, wireless Internet manager at Progressive, of Mayfield Village, Ohio. "Every time you pass a phone store, you see them offering Web-enabled phones."

Progressive plans to extend the service, which made its debut last month, to other hand-held devices including Palm Corp.'s Palm VII and Research In Motion's pagers that use the Blackberry system. It also plans to offer online bill payment soon.

Other major insurers are considering offering wireless services. Allstate Corp. of Chicago plans to roll out a service similar to Progressive's soon.

Progressive, the biggest seller of auto insurance through independent agents, generated $6.1 billion of net written premiums last year.

Wireless services are a natural fit for insurers, Mr. Khoury said. "The reason most Americans bought [cellular] phones was so that, if they have an accident in their cars, they could report it," he said. "Now they can also contact their insurance company, and, with the new location technology, we can know exactly where they are."

A Federal Communications Commission directive that will take effect sometime next year will require all new cellular phones to automatically identify the caller's location, using Global Positioning System and cellular technology.

The wireless service is not just designed for disaster situations, Mr. Khoury said. "We envision a future when customers can type in the VIN [vehicle identification number] of the new car they're buying, and we can tell them right away how much insurance is going to cost, or we can send them alerts about a model recall."

Progressive has embraced the Wireless Application Protocol, a standard that most experts say will soon be superseded by technology with better bandwidth. Critics say the protocol is confining, while supporters say it permits the broadest application of wireless technology available today.

"When people talk about WAP, it's not so much about the protocol itself but rather the devices [their customers] are using," Mr. Khoury said. "I don't think WAP should be an issue. We don't care what type of device or phone our customers use."

Ultimately, "our service will reach anyone with a handheld device," he said.

When it comes to technology, Progressive Insurance, a unit of Progressive Corp., has a history of being, well, progressive.

In 1990 the company equipped its claims representatives with mobile computers, allowing them to approve estimates and write checks at the scene of an accident. Four years later it began offering consumers auto insurance quotes with comparisons of rates from four other companies. A year later it became the first auto insurer to have a Web site.

In 1997 Progressive became the first auto insurer to provide instant insurance coverage over the Internet and allow customers use their own computers to print the documents to certify proof of coverage.

A year later the company introduced Autograph, a product that uses GPS and cellular technology to offer customers auto insurance rates based primarily on how much, when, and where a vehicle is driven.

Progressive executives say that the wireless service is too new for them to gauge customer reaction, and that they are not even monitoring hits to the Mobile Progressive area of the company's Web site.

Mr. Khoury said the service took just a few months to develop. "Once you have an Internet site up and ready, you can leverage what you already have into a wireless site."

While many financial service providers are using outsourcers like 724 Solutions Inc. and Ajaxo.com, Progressive did all its wireless development in-house.

"We're one of the few companies that decided to do it themselves," Mr. Khoury said. "It took us a few months with a small team of people. There's no 'WAP for Dummies' manual, so we had to work a little harder to perfect the product."

Progressive said that it is not planning a big marketing splash for the service, and that a mention on its Web page will be enough to attract customers who own Web phones. Mr. Khoury said the company will seek alliances with other Web e-tailers.

When wireless Web devices really catch on - some estimates say there will be more than 100 million Internet-enabled phones in the United States in two years - Progressive will broaden the reach and advertising budget for its service, he said.

Mr. Khoury said he does not expect many problems with what some experts call "channel conflict," the battle between a company's existing agency network and direct sales to consumers through the Internet.

Progressive has been dealing with channel conflict for years, ever since it began letting customers buy insurance over toll-free telephone lines and the Internet, he said.

"All a customer has to do is hit a menu button, and we'll tell them the location of the nearest agent," Mr. Khoury said. "There is some amount of channel conflict, but it's not meaningful."

Mr. Jedlicka, a freelance writer in Atlanta, was an American Banker reporter and the editor of Bank Investment Services Report.

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