Sharing the economy offers insurers lucrative new revenue streams
In its groundbreaking 2010 book, What are mine: Your emergence of collaborative consumption Professor and Trust Expert Rachel Botsman in Oxford University argues that we are "wired to share ". The popularity of riding and room companies has shown the Botsman right.
In 2014, the global sharing economy generated $ 14 billion in business. It is estimated at $ 335 billion by 2025, a reflection of how fast the market is growing.
A new report from the US insurance and finance company Country Financial showed that three out of five Americans make money through the sharing economy. t purchased additional insurance to cover themselves. This indicates a lot of growth potential, and insurance companies can enter this huge market by creating innovative, relevant and affordable products.
Want a trend where people experience themselves again about how they consume goods and services, insurance companies offer flexible solutions to meet the industry's needs.
How the insurance industry sees the market for sharing economy
Accenture specifically looked to share finance offers as part of our
, hundreds of insurance consultants chose their readiness to embrace change.
We found that almost half of all respondents, or 44 percent, planned to enter the market because they thought it had a very good potential. Twenty-two percent had already entered the market, while 27 percent considered it. Six percent were aware of their potential, but were not ready yet to enter the market
Insurance Insurance in Action
In 2017, the Insurance Institute Canada published a study that spelled out what the industry should do to meet the challenges of the sharing economy. The report presented five proposals, including a call for a contingency assessment for the sharing economy, to identify how the industry will develop products.
However, there are barriers revealed by a study by the United States, Britain and China of Lloyd's of London. One problem is the lack of clarity on how to share the risks, it said. The Sharing Economy Working Group, a unit set up by the Canadian province of Quebec, has made several recommendations for breaking down barriers and making market entry smooth.
Large insurance companies like Allianz and Zurich have launched dedicated units to explore business potential. Prior to last summer's season Allianz saw an interesting development in the US market: it said the intention to use the finance services was reduced in favor of more traditional services.
It was just a small blip on an otherwise robust market, with opportunities for continued growth strong. So insurers including Allianz continue to make significant investments in the sector, embracing the digital future wholeheartedly.
In 2016, French insurance company AXA CEO Thomas Buberl summed up the challenges by telling the Financial Times: "Today, our competition is Allianz and Generali, but tomorrow it can be Google and Facebook." AXA then forged partnerships with a number of companies including Grab, BlaBlaCar, MyTwinPlace and Friendsurance.
Talk about innovation, some companies already make headlines with customized products.
Marsh, a leading global insurance broker, has recently presented a cloud-based platform called Bluestream for the affinity market, and meets the needs of the sharing economy. Some of Bluestream's features are based on blockchain technology and artificial intelligence.
How does it work? The company says that Bluestream helps customers choose and scale the insurance solution that best meets their needs.
Most forms of insurance provide cover for tangible assets, insurance companies are increasingly faced with the challenge of protecting customers' intangible assets. The solution lies in innovation and collaboration, and some insurance companies are already reaping the benefits of investing in such projects.
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Accenture Technology Vision 2018