Online Insurance - Personal Insurance Via Your Mobile
Do you find insurance a real hassle to sort out?
There’s no doubt that insurance is extremely important to have for certain parts of your life. To go one step further, in some countries it’s illegal to do certain activities if you’re not insured. Yet, despite this, people often find insurance companies inaccessible, difficult to contact, and confusing to deal with.
However, there are new companies and operations that are trying to counter this archaic problem. One of the most effective strategies here has been to use the latest technologies that are used by the majority of people - mobile phones and apps. When done correctly, this lets insurers respond faster and satisfy their customers’ needs much quicker. One example of a company that does this extremely well is Lemonade, who we’ll discuss more later in this article.
Insurance is changing
In recent years, industry after industry has been forced to adapt and change to new patterns within society. The internet and huge technological leaps have caused almost every area of our lives to function differently than it did not so long ago.
Think of an industry, for instance retail, banking, media, sports, or manufacturing. From every angle we look, changes in society have caused these industries to evolve with the times. One of the biggest of these changes was the internet, as well as new breakthroughs in technology. These developments have created an environment where mobiles and apps can make communication between companies and customers so much easier. However, one of the most exciting areas that still has much potential for the future is peer to peer services.
You might not have realised, but peer to peer sharing has been revolutionising industries in recent years. From money transferring, to accommodation and holiday rental, and everything else in between. Up until recently, one of the major institutions that seemed out of reach from peer to peer was insurance. But this is no longer the case. Insurance companies such as Lemonade have utilised the P2P model to bring a new form of insurance into the market.
Traditionally, the insurance business makes the most amount of money when there are not many, or no claims. This means some companies will actually try to avoid paying out wherever possible. This mode of operation gets changed in the P2P model. Instead of the insurer acting as the second party, they act as an intermediary between a wider group of people using the insurer’s platform.
In the old model, there was the potential for conflict between the insurer and the person who has taken insurance out with them. With this new model, P2P means that the insurer provides more of a platform and isn’t pitched head to head with the people insuring their goods.
How it works with Lemonade is that a group of people come together and pay the premiums that are for a claim pool. These people will pay the premiums as a collective when there’s been a claim. The members of each group will also get any funds that remain at the end of the policy period, minus a 20% fee that the company takes, donated to a place of their choosing.
Part of the thinking behind this approach to insurance is that the system will partially market itself because people are able to form their own groups. But a very important factor is that it brings in a new element of risk management, whereby dishonest people are filtered out. So while the margin for businesses is not as high compared to a traditional model, the costs of customer acquisition and client rating is reduced.
This system relies on there being enough people using the insurer to come together into groups. One of the big selling points for Lemonade, particularly for younger people, is that there is no agent involvement and paperwork doesn’t have to be filled in. Instead, using the mobile app, it becomes quicker and more straightforward for people to sign up and use a P2P insurance model. With the app, an address needs to be answered, alongside some questions, and a person can be covered in a few short minutes.
As long as people have had money, wealth, and items of value, they have looked to protect that and make sure they don’t lose out if something bad was to happen. Insurance and insurers have been around for a long time in multiple different formats. Looking forward to the future, engaging a wider customer base through mobile apps, seems like it will only become more popular.
200 billion yuan ($28 billion) will be invested by Alibaba Group Holding Ltd. into the development of their cloud infrastructure. This will take place over a three year period in an attempt to push its services further into more countries and markets