There are many white papers about the sharing economy, and we do not want to repeat much of what has already been said. Rather, we will start this paper with a short overview of the thinking to date, and then focus on the latest emerging trends, giving insights on how the sharing economy will impact upon the services insurers provide to their customers and identifying a series of opportunities for insurers which could be keys to helping this economy develop and flourish.
Emerging trends of the sharing economy
- There is a culture and market shift towards access rather than owning;
- Sharing economy platforms are providing secondary insurance but could move to primary;
- Other insurance offerings are emerging specifically for this economy;
- Services are being used by certain demographic cohorts which make targeting and risk profiling easier;
- Regulation is being adjusted and is increasing;
- Big businesses are acquiring platforms as they see access-not-owning as part of their business models;
- Sharing economy platforms are acquiring competitors for geographical expansion and/or advanced tech capability;
- Associations and standards are forming;
- Trust systems are developing.
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This economy is maturing and provides many opportunities for insurers
- Creating blended/hybrid policies – standard insurance plus extensions for shared economy services provision and/or use;
- Providing insurance solutions for specific platforms;
- Obtaining access to the platform client base – both providers and customers of the service, extending geographic and segment reach;
- Sharing broad risk data for focused cohorts in order to insure risk for a platform;
- Investing in emerging platforms for financial return and/or a future link with a major brand;
- Sharing technology;
- Helping to create standards and networks;
- Working with platforms on data matching in order to increase trust and decrease unsafe activities.
Insurers should embrace the sharing economy and create a strategic plan which results in action on one or more of the opportunities presented.
Geoff Knott is a Non-Exec Director of Ninety. He has a background in IT, has started several companies, had a corporate career with IMS Health and Dun & Bradstreet where he was a Senior VP on the European Board. He has been a CEO of a medium sized charity and helps many start-up businesses, social enterprises and charities. He publishes research on many social issues.