# 1996: websites start showing dozens of insurance prices in seconds.

- Series: [The Better Guess](https://miu.fm/thebetterguess.md)
- Premieres: 2026-11-09
- Page: https://miu.fm/thebetterguess/1996-websites-start-showing-dozens-of-insurance-prices-in

## Story

1996: websites start showing dozens of insurance prices in seconds. Do prices fall, or do they even out?

Chicago, February 1959: the same Chevrolet model at over two dozen dealers, from $2,350 to $2,515. In 1961 the economist George Stigler asked why one thing has many prices. Finding the best one, he said, takes time. Picture shops charging $2 or $3, half and half: ask one and you expect $2.50, two $2.25, three $2.125. Each extra shop saves half as much as the last, so people stop asking, and the price differences survive. He called the spread "the measure of ignorance in the market".

Then asking became almost free. Term life insurance prices fell, by 8 to 15 percent from the internet alone, and fastest where more people went online. Whole life, which the sites didn't compare, didn't get cheaper. But prices didn't even out: at first, the spread got wider.

Stigler's last line: "Ignorance is like subzero weather."

The screen of quotes, the shop doors, the cost line and the spread curve are our drawings; the numbers are from the papers below.

So, which did you pick?

Sources: George J. Stigler, "The Economics of Information", Journal of Political Economy, 1961; Jeffrey R. Brown and Austan Goolsbee, "Does the Internet Make Markets More Competitive? Evidence from the Life Insurance Industry", NBER Working Paper 7996, 2000 (Journal of Political Economy, 2002).
Sounds: our own, made in code (earshot, CC0).

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