When I started working in the insurance industry, a very wise (if somewhat cynical) colleague gave me his analysis of the product: “Insurance is dead simple, but trained professionals have spent 300 years making it impossible to understand.” This could be a theme which explains – and which caused – a current disruption trend.
What’s not to like about home insurance?
Since taking possession of my first rented apartment, I have paid for home insurance. But early on, I was surprised to find that, in my cohort, I was an exception more often than not.
In discussions about home insurance, I learned to expect horror stories about premiums and claims. If there was a claim for a lost or damaged item, and the claim was not declined, the settlement was a typically a small percentage of the cost of the item. And, it typically triggered an increase in premium.
Things have changed …
… to a certain extent. Now most renters must have tenants insurance as a requirement in the lease. I haven’t asked, but I’m guessing this is not terribly engaging for newcomers to the insurance world.
But there is an InsurTech supplier that brings a new take on property insurance by turning standard provisions outside-in, making the insurance product interesting and – dare I say – engaging.
Trōv is the Silicon Valley InsurTech behind an app which allows insureds to easily inventory their belongings, calculate the value of each item, and activate coverage for particular items that may not be covered outside the home.
And insurers see a complementary advantage
Trōv is a tech company, not an insurer. Trōv ‘s first implementation came with Suncorp Group in Australia in May, 2016.
Here’s how it works with consumer electronics (the first category for Trōv): The Trōv App allows the insured to turn replacement cost protection – underwritten by Sunguard – on or off, using the app on a smartphone.
For example, if a laptop is not covered outside the home with the base policy, insured simply turns Trōv Protection on until the item is returned to the home and the protection is switched off.
Claims notification is handled by text messages. Settlement is a transfer to the insured’s account.
Trōv launched the product in the UK (partnering with AXA) and has plans to launch in the US later this year (with Munich RE). The coverage is expanding beyond consumer electronics to music instruments and sports equipment (e.g., bicycles).
Bringing a new cohort to insurance with hope, not fear
As you might guess, millennials comprise the target group for Trōv (and its insurer partners). Scott Walchek, Trōv’s CEO and co-founder, had this to say:
“The millennial generation is signaling to the world they need new kinds of services that are on-demand. They just don’t want to talk to people. They want ultimate control over their product and services and they get that control through their smartphone; that is how their world comes to them and Trōv is the first reinvention of the way people protect their things.”
From an insurance practitioner’s perspective, Trōv is helping insurers penetrate and engage a segment that has a jaded view of the existing product. Gareth Howell, managing director at AXA Insurance, responded to Business Insider in an email statement:
“The launch of Trōv in the UK heralds a new age of insurance, which will see millennials, the most underinsured generation ever, introduced to a way of insuring their belongings that fits with their lifestyle. We are proud to partner with Trōv in the UK to be able to better reach the emerging generations.”
What do you think?
In addition to the inherent benefits of the on-demand insurance construct, I like Trōv’s predilection to work with insurers rather than setting up competing entities. This can’t be true for all situations, but in this case, Trōv can use its expertise while relying on insurers to use its own.
I’d be interested in your thoughts.
We’d like you to meet Trōv in Canada …
Mark Dowds, Trōv’s Chief Strategy Officer and co-founder, will be presenting on “Enabling On-Demand Insurance” at the 2017 Insurance-Canada Executive Forum (#ICXF2017) on 29 August 2017 in Toronto. Details and registration information here.