Following a model that has worked well for loans and mortgages, Priceline.com is adding auto insurance to its mix through a new alliance, and more lines of insurance are on the way.

The Norwalk, Conn., company and the W.R. Berkley Corp. property and casualty holding company have formed Priceline.com Auto Insurance Agency Inc., which is to offer "name your own price" coverage through Priceline.com starting in early 2001.

"Private-passenger auto [insurance] is an approximately $120 billion industry," said Eugene G. Ballard, senior vice president and chief financial officer of Greenwich, Conn.-based W.R. Berkley. The venture will let the agency participate in a new conduit for insurance while gaining access to Priceline.com's customer base.

W.R. Berkley will act as agent in the transactions, contracting with insurance companies. While he declined to name the companies that would be participating, chairman/president William R. Berkley said the partners expect to have 10 to 15 carriers signed up by the time the service goes live.

Customers will plug in information about their cars and say how much they would like to pay for auto insurance. Priceline.com's rating engine will attempt to find a match with the price.

If the agency cannot meet the customer's request, Mr. Berkley said, the system will come back with suggestions - such as possible changes in coverage - to lower the premium.

Once customers are matched with a policy, they can make a down payment on the premium with a credit card and bind coverage at the Web site, he said.

Customers will also be able to learn about insurance through on-line tutorials before using the system, and there will be support through a call center, Mr. Ballard said.

He added that the alliance's technology could also be applied to other lines of insurance. "We expect we will be getting involved in homeowners, and at some point, other personal line products like personal umbrella," he said.

On any completed transaction the alliance will be paid a commission. But commission rates will be lower than those of traditional agencies, which range from 11% to 12%, Mr. Berkley said.

"Those savings will all be passed on to the customer," he added.

Insurance is a good fit with Priceline.com's expanding slate of financial services products, said Ben Ness, senior vice president of financial services for Priceline.

The company also offers mortgages and home equity loans, and is to add term life insurance this year. "Ultimately we will have a suite of financial services that make sense from a consumer point of view," he said.The most important component of Priceline.com's package is the ability to close and bind transactions online, Mr. Ness said. "We try to e-commerce-enable all of these things."

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