On-demand insurance set to become a bigger part of the industry: IUA

On-demand insurance will play a fundamental role in the future of the industry, according to research from the International Underwriting Association (IUA)., which says that pay-as-you go models of cover will allow customers to automatically activate policies when and where they need them.

The new IUA report, titled ‘On-demand and conquer: is the future of insurance a pay-as-you-go one?’, examines technology surrounding autonomous vehicles and aviation drones. It looks at questions such as the role of big data corporations and tech start-ups in exploiting new technology, the availability of data and fraud risks. It also discusses the potential for on-demand insurance models to access new markets and customers.

The report includes a case study is presented with Flock – Europe’s first ‘pay-as-you-fly’ drone insurance product, launched last year. Users enter flight details and receive a quote that is influenced in real time by factors such as time of day, location and flight conditions.

Tom Chamberlain, underwriting manager general aviation and aerospace, London, Allianz Global Corporate & Specialty, said: “In the future insurance will be based around whatever you are doing. You will be in your house and your insurance will be active and when you leave your front door your premium will step up as it is now unoccupied. You will then get into a shared economy car and your phone will interact and automatically trigger your insurance for that journey.

He added: “Your insurance will follow you as you go and as your activity changes. It will no longer be a manual process and could realistically work for everything you do requiring insurance.”

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