It is a truth universally acknowledged that the traditional auto insurance industry is going through an upheaval.
Many companies, from startups like Slice Labs, to brand names like Geico or Farmers Insurance, now offer insurance to rideshare drivers to fill the gap between personal and commercial auto insurance.
But there is more disruption happening within the industry, based on how people are interpreting the experience of owning and driving a car. The concept of a vehicle is, in many ways, becoming less of a solitary experience, as people carpool, ride-hail, and even purchase cars together; Cars are become increasingly digitally connected to riders and other cars on the road. The components of owning a vehicle — insurance, maintenance, loans, etc. — are also becoming a shared endeavor as a result.
Mobility.Buzz took a look at some insurance companies that are adjusting to this cultural shift with responses of their own. Call it Newton’s Third Law of Insurance, if you will. Here are 3 insurance companies driving into mobility:
1. Slice Labs
Slice Labs, a New York City-based startup, offers an on-demand insurance platform to support the ridesharing economy. The platform allows participants to easily purchase insurance policies when they need it, without committing to any annual plans. It offers a pay-per-use policy for Uber and Lyft drivers that covers drivers from the time they turn on the rideshare application until they turn it off.
Currently, Slice is testing its insurance technology through an app with a select set of 50 rideshare drivers in multiple locations. Depending on how the tests go, Slice will then roll out the app and issue policies in one state toward the end of the second quarter, according to a published report.
Slice, founded in 2015, is backed by Horizons Ventures, XL Innovate, Munich Re and Tusk Ventures.
Considering so many people share a single car, why can’t they also share insurance now, too? In comes, Guevara, a web-based insurance platform that enables its users to pool their car insurance premiums online to save money. “That money then pays for claims, and anything leftover stays with the group to discount their renewal,” the company said.
The peer-to-peer insurer allows individuals to either join a private group with five or more people they know or join a public group of people. A person is able to search for public groups on the Guevara website, but cannot purchase insurance outside of a group.
Guevara is based in London, England, and was founded in 2013.
Columbus, Ohio-based Root Insurance announced last month in a blog post that Tesla owners are now eligible for a discount if they use Autosteer, a flagship feature of Autopilot that keeps the car in its lane even when approaching curves. The move is in response to a government report that found crash rates for Tesla vehicles have plummeted 40% since Autosteer was first installed in 2015, Root said in the blog post.
It’s a clever way to get Tesla owners in Ohio to switch insurance companies. There are currently three Tesla showrooms and three Tesla supercharger stations available in Ohio. But overall, it also speaks to a larger disruption in the insurance industry, which is that as cars become safer with autonomous tech, insurance premiums will have to fall to compensate for the lower risk.
Those interested in learning more about the evolution of the transportation industry should join us at the second annual Auto Finance Innovation 2017 conference, May 17-18 at the Hilton Bayfront in San Diego. Visit www.autofinanceinnovation.com and to learn more.1 - Reader Likes This Post