THE RISE OF DIS­RUP­TION IN IN­SUR­ANCE IN­DUS­TRY

Industry Leaders - - New Ven­tures -

If ev­ery­one is try­ing crowd­sourc­ing, how about try­ing to use the crowd­sourc­ing prac­tice in in­sur­ance to of­fer an ac­cess to a risk cap­i­tal that is bud­get friendly? Why not of­fer re­wards to pol­i­cy­hold­ers for poli­cies that are un­used?

Friend­surance, a Ger­many­based com­pany launched back in 2010 uti­lizes a peer-to-peer con­cept for in­sur­ance. This is mu­tu­al­iz­ing sim­i­lar risk amongst a group of friends (self-se­lected) and re­ward­ing these groups with bonuses in the form of cash at year’s end ev­ery year, but only if they re­main without claims. Through a fund as­so­ci­a­tion, the group man­ages small claims. It also has an in­sur­ance com­pany, which backs the ar­range­ments for larger claims. A pre­mium is paid by each mem­ber of the group. A part of this is car­ried for­ward to the fund that cov­ers small losses. An­other part of this pre­mium is of­fered to a reg­u­lated in­surer of­fer­ing the in­sur­ance pol­icy of group to take the risk for big­ger ex­po­sures.

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