The Dog Stars
David Brooks on libertarian paternalism and "nudge"

Confusing Consumers is an Art

Jonathan B. Wight

Using behavioral economics, Allstate Insurance can tailor a message to confuse consumers in a way that consumers want to be fooled.

Step 1:  Promise consumers something they really want. 

ALLSTATE:  “With accident forgiveness, your insurance rates won’t rise after an accident.”

CONSUMER:  “Oh goody!  I know I’m a bad driver and now I’ll really act crazy and tell all my bozo friends to join this insane company.  Parents with teenage drivers—let’s all pile on.” 

Step 2:  Tell consumes they can have this feature at no charge!

Of course it’s “free” if you forget that this policy costs more than other policies without accident forgiveness AND if you ignore that accident-free drivers will receive a rebate check every six months.

People will believe what they want to believe.

But how stupid are we? Apparently, quite, since Allstate continues to blanket the country with these alluring ads. 


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Your post is titled Nationwide, but I think you mean Allstate. The link also seems to go to an article about Allstate.

Thanks, Tim!

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