Recently, I suggested that the the digital economy offered opportunities for new revenue – but this would require insurers to look at new models. The example was the introduction of coverage that bridged a gap.
Let’s look at a different model which meets specific features of the new economy and promises real disruption.
When you have flexible resources …
A lot of the new economy products and services are opportunistic. For example, if I have space in my home that I am not using, I can offer to rent it on Airbnb. And, as we saw in our earlier post on Turo, if we have a car we are not using, we can rent it to drivers.
For our immediate purposes here, if you have spare time and own a car, you can share out your own time as an Uber or Lyft driver.
A major issue with all of the above – most prominently with the ride-sharing offerings – is insurance.
You don’t need inflexible insurance …
The good news is that insurance is mostly available. The bad news is that commercial insurance which normally covers these risks it is expensive and difficult to obtain, primarily because it is designed for professionals who require it full-time.
Why can’t we have on-demand insurance for on-demand services?
Now you can have the ‘Slice’ you need
Headquartered in New York City, Slice Labs Inc. is an insurtech startup which has developed what it claims is “the world’s first on-demand insurance platform to support the on-demand economy.”
Slice’s first product is an on-demand offering for ride-sharing drivers. At present, there is a patchwork of coverages that are available, many of which don’t cover all of the risks. It is up to the driver to understand what is is, what is out, and what the conditions are.
Slice is intended to eliminate the the patchwork with a simple cover that combines personal and commercial insurance. The driver turns ‘on’ (with a phone app) when she is using the vehicle for ride sharing and ‘off’ when not.
What is Slice anyway?
Slice is an MGA with underwriting and issuance authority. At present, it is licensed to operate in seven states. It plans to expand to 50 states.
Slice raised US$3.9 million in seed capital from Horizon Ventures and XL Innovate.
Slice markets directly, issues the declarations, and will manage the claims.
Pretty good reviews, innovative approaches, and real disruption
Slice is confident that it has found an important niche. Tim Attia, CEO and co-founder of Slice said, “The on-demand platforms have changed the game. Insurance must be truly friction-less and as seamless as transactions on these platforms.”
Frances Kang from Horizons noted that “Its algorithmic approach and data-driven pricing model are truly innovative in the insurtech world.”
Celent’s Mike Fitzgerald, recently noted that Slice is employing a true disruptive model, rather than an incrementalist approach favoured by many. In his blog, Mike wrote that Slice’s “stated goal is to not only change the way we work with insurance products, but to change the way the insurance product works.”
And a place to learn more …
Last week, Slice and Mike Fitzgerald from Celent agreed to join the faculty of the 2016 Insurance-Canada.ca Executive Forum, August 30, 2016 at the Sheraton Centre in Toronto. More details will be available soon.
We hope you can join us as well.
Read the first part of this post: “Insuring the Digital Economy (Part 1): New Modes, New Methods.”