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most dynamic sources of business growth. In 2001 the
company’s link to AARP’s Web site accounted for much
of the $55 million worth of auto business The Hartford
generated over the Internet.
Because The Hartford quotes and issues this busi-
ness online (and added online billing in 2001), acquisi-
tion and processing costs are 15 to 20 percent lower
than those of traditional direct-marketing or face-to-
face sales. Because of this and other factors, the
expense ratio for AARP business is 30 percent below
that of the industry in general. And the customer
renewal rate is 96 percent, versus the industry’s 88 per-
cent, making the AARP program yield some of the most
proﬁtable auto business The Hartford writes.
The relationship also has The Hartford thinking
ahead toward new business and an even stronger rela-
tionship with AARP members. The Hartford can cross-
market auto insurance to homeowner’s customers and
homeowner’s insurance to auto customers, which 
presents a tremendous growth opportunity. In addition,
The Hartford is committed to providing value to AARP
members in many ways. An example: The Hartford and
AARP work with the MIT Age Lab to produce informa-
tion—available in print and on both partners’ Web
sites—advising AARP members about Alzheimer’s dis-
ease and other forms of dementia as they affect driving
ability. The information guides caregivers struggling
with difﬁcult decisions about family members’ safety
behind the wheel. The resource—a customer solution
like no other—helps enhance the superior value The
Hartford provides to AARP members.
Although it’s the most comprehensive, the AARP
relationship isn’t The Hartford’s only afﬁnity program.
The company also has afﬁnity arrangements with
USAA and other companies. Regardless of the pro-
gram’s size, the afﬁnity partners share the right quali-
ties: strong name-brand recognition, first-class
marketing and a broad and loyal customer base.
In other words, they share some of The Hartford’s
core attributes.