With the rise of InsurTech startups and FinTech stars such as Monzo there has been considerable disruption to customers expectations of how traditional insurers and banks handle their customers. Insurance companies especially now need to concentrate on creating a community that loves the brand whilst not focusing too heavily on their selling price as there will always be another player who can undercut them. Insurance has some of the lowest Net Promoter Score (NPS) ratings of any industry, meaning they do not inspire satisfaction or loyalty in their customers. This creates customers that are not willing to recommend their products to others. This makes it imperative for insurers to think about their members and creating a sense of community as referrals are still one of the best sources to attract new customers. With this in mind here are our findings on the current trends…


The Sharing Economy

Currently millions of people up and down the country are now finding new ways to share their assets, talents and free time with the help of innovative technology. The growth of the sharing economy in the UK has grown exponentially over the last couple of years.

Peer to peer insurance is one of way that shows the true potential of the sharing economy at work. With the power of group mentality and transparency twinned to create an insurance policy that is fair and fit for purpose. Why wouldn’t anyone with trusted friends not want to be on this policy? The basic form of peer to peer insurance is that a group of friends hold the policy that they all chip into as a group online. Damages are paid out of the groups fund to group members who have accidents. Especially with insurance for young drivers at all time highs and 60% of millennials preferring renting homes and cars instead of owning them, there is a real chance for car sharing and car rental to sky rocket in popularity over the coming years.

Before an estimated 10 million autonomous cars drive off with the limelight in 2020. Providing specific insurance for the sharing economy will be one of the largest growth areas for insurers in the next five years. According to the British Insurance Brokers’ Association (BIBA)


Data Driven Market

In our previous trend articles we have talked a lot about the usage of data. Insurance is not the exception. When you think about the exponential growth in new sources of data together with data science enabled by tech, it is inevitable that premiums will become highly personalised. This will be made possible by technologies such as wearables from the likes of fitbit, telematics, IoT and  smartphone apps. Days are numbered for insurers that provide policies that mean people of the same age and gender, with identical cars or homes living on the same street will pay the same premium. Patrick Vandoren, General Manager P&C, KBC Insurance says “In the future, we will no longer insure risks, but become a service company driven by data”.

This move towards a data-driven market is creating opportunities especially for digitally-enabled motor insurance. Insurers providing this service will be able to put a price tag on value-added services which will mean the ‘discount trap’ that telematics and other data collecting devices will be avoided. Remember young people are particularly willing to share data, if in return they are given an enriched personalised service and are able to cherry pick the data they share. The other reason for data driven markets is because customers demand it. They want a purely digital experience that does not require human contact and therefore keeps up with their fast paced world. In fact 74% of consumers would be happy to get computer-generated insurance advice so in the insurance world a machine will do nicely, thank you.


On-demand consumers

In this ever fast paced world where lifestyle apps are the norm for handling our busy lives. It is hard to find someone without a lifestyle app. This makes them the perfect vehicle to provide the peace of mind that customers are getting the best deal when they buy insurance. When these apps are used the annual chore of hunting for the lowest priced insurance vanishes, lifestyle apps offer value on a daily basis when insurers use the data that is collected from them to make informed decisions. This makes the customers that use them ‘sticky’ which, for insurers, means more retention and loyalty. It also gives insurers greater insight into their customers behaviour, so they can make informed decisions about which policies suit their customers.

Cuvva and By_Miles, are just a few of the names offering a pay-as-you-go insurance model, which allows drivers to get cover by the hour or per mile through logging journeys on a smartphone app each time they require coverage. With consumers charged a small fee for each journey on top of a monthly subscription, could this be the car insurance market’s ‘Netflix moment’ as consumers switch to on-demand.


The Rise of InsurTech

More and more, traditional Property & Casualty insurers are collaborating with InsurTech Firms and investing in emerging technologies. History is repeating itself as InsurTech firms are getting snapped up as fast as FinTech firms are fending off larger rivals every month. Unfortunately typical insurers have been slow to adapt and this has meant that innovations such as the All-in-One insurance policy has finally become a reality. From the customer’s perspective, the All-in-One policy initiated by InsurTech companies makes perfect sense. Why can’t we simply have one relationship with one insurer and have ‘everything’ covered in one go? This is good news not just for millennials and GenYs but for the older generation. If you are able to give the insurer the details about your car, home, health, travel, pets, and possessions and in return they give you one overarching policy, a fair price and the ability to flexibly adjust the cover as needed why wouldn’t many customers switch to this type of policy?

Getsafe one of the pioneers of the All-in-One policy supplies modular insurance that takes just 5 minutes to apply. Combined with this speed is their 24/7 availability through their AI named Carla who can check claims and transfer money ‘super fast’ in real time. Now here comes the clever part Getsafe donates any unclaimed premiums to a charity of the members choice. This approach incentivises their members to commit less insurance fraud – because if they do, they take money away from their social cause – and not from them. This approach brings the best of human intuition within an artificially intelligent solution thats keeps up with the pace of customers’ changing needs and preferences. This ultimately means a loyal fanbase is created as they are able to donate to their favoured cause without lifting a finger and the service is as fast as they are.

Here at Underscore we are excited to see how these sectors adapt to deal with pressures from audience demographics and buying behaviours changing so much.



Today is a great day for new business
Today is a great day for new business