Why The Co-Operators is exploring ‘episodic’ insurance
Digitalization’s impact on the insurance industry is two-fold. First, and most notably, customers. want their insurers to provide top-notch digital experiences around their policies, billing and claims. But there are also downstream effects on the core insurance industry – that is, the risks that need to be managed and covered – that come as a result of digital disruption in other sectors.
For example, the emerging sharing economy has blurred the line between personal and business use of property. The insurtech Slice has developed a platform to help insurers offer supplemental coverage, with clear start and end times, to customers that wish to offer their home on home-sharing networks like Airbnb. Now, Slice is expanding into Canada through a partnership with multiline carrier The Co-Operators, which is using the platform to launch duuo, a product for homeowners.
“There’s a chicken-and-egg aspect of this,” says Rob Wesseling, president and CEO of The Co-operators. “Some of the technologies that are enabling our clients to conduct their lives and transact their business in different ways are the same enabling techs that allow us to meet those needs.”
Slice’s platform is allowing The Co-operators to create an end-to-end digital experience for customers to get coverage for their home and contents while it’s rented out. The quick and easy, on-and-off nature of the product is part of a move toward what Wesseling calls “episodic” insurance.
“There’s a significant contingent of unmet and undermet needs vis a vis insurance, and it’s difficult with existing models to get at those needs,” says Wesseling. “Individuals have interest in gaining insurance against their risk for specific time periods – for example, personal-device coverage that triggers when you leave a geofenced area around your home.”
For the time being, the duuo product is The Co-operator’s only foray into this kind of coverage. However, Wesseling says, the data and distribution capabilities from digital platforms like Slice’s are spurring innovative thoughts within his company.
“The primary lens that we look at our cooperative through is what are the needs of our customers – are there unmet needs that we should be focusing on on their behalf,” he says. “There’s a requirement that we answer the bell and fill the gaps that are associated.”