Recently, the trend of embedded insurance is gaining momentum. By making insurance services more accessible and on-demand, it has got the attention of a lot of people because of its value. While embedded insurance has opened new revenue streams and facilitated lower distribution costs for the insurers, the end customers, including firms, individuals, and families, are now enjoying affordable insurance at the time and place they need it.
Embedded insurance has fixed all the loopholes of the insurance industry and made getting insurance a cakewalk.
Let us walk you through the nitty-gritty of embedded insurance and explain why it has become a big deal.
What is embedded insurance?
Embedded insurance or Insurance-as-a-Service (IaaS) merges protection or coverage within the product or service. It means, when you purchase a product or a service, you get insurance coverage at the time of your purchase or in real-time. Buying an expensive gadget and getting protection against theft as a part of the package is an example of how embedded insurance works.
Embedded insurance is a seamless fusion of insurance into technology that allows a third-party service provider, developer, or product to integrate insurance solutions to their offerings as a core offering or an appendage.
Embedded insurance: The most straightforward way to get insurance
Getting insurance has never been simple. It has always been a tedious process involving a lot of paperwork, time, and effort. It has long kept people from protecting their possessions from any unforeseen damage unless it’s a necessity. But now, with embedded insurance, getting coverage on anything is the least burdensome task. Moreover, getting products that are already protected against uninsured losses without having to go through the tedious process of protecting them gives the consumers peace of mind.
With embedded insurance, the protection gap between the insurance bought and the insurance required has narrowed down by leaps and bounds. It is proving to be a boon in various arenas.
Embedded insurance: A boon for stakeholders
Risk situations are everywhere, providing insurance companies opportunities at every step. With embedded insurance, the companies are now able to use these opportunities.
Today, companies can embed their products where needed via API, enabling other software businesses to join. The insurers can now target the platforms with a broad customer base and plug in their products. They can offer personalized policies right at the time when a customer needs them and get their hands on customer data to carry out risk assessments in real-time and determine the pricing more precisely.
Identifying these benefits, more and more insurance companies are eyeing to narrow the protection gaps by embedding their offerings. They are now extending their services to relevant customers right at the time and place where insurance is needed (in most cases, where customers don’t even realize that they need insurance), making it a give-and-take thing.
The benefits of embedded insurance for end consumers
The concept of embedded insurance is benefitting everyone but the largest share of it is in the court of end consumers. Apart from getting insurance without having to deal with any tedious process, consumers get a personalized insurance plan that exactly fits into their needs.
The bottom line
The B2B2C environment is cut-throat. All the entities that form this ecosystem struggle hard to survive. Amidst this, the advanced concept of embedded insurance helps insurers to thrive. It gives them an opportunity to provide personalized solutions, expand their offerings, and enter emerging ecosystems.
By understanding manufacturers, the supply chain, and customers, insurers can now create a win-win situation for everyone. Companies like Salty have are already growing on this path, opportunities are ample for every insurer.