Trov forges new partnership with UFODrive
The insurtech, which was founded in 2012 by tech entrepreneur Scott Walchek, has a strong sector presence in the US. The company hit the headlines last year following its collaboration with Seguros Sura, the Latin American insurer, to bring on-demand products to the Brazilian marketplace.
Currently, Trov claims to be a global leader in insurtech platforms that enable financial institutions and insurance incumbents to swiftly launch modern solutions for homeowners, renters, drivers, and small businesses. The company has also raised more than US$114m from VC’s and strategic partners since its launch.
Trov said the partnership with Trov signifies a ‘major milestone’ for the company, as it sets the stage for expansion into the UK as well as positioning it as a major partner for mobility enterprises seeking bespoke solutions for their services.
The move into the electric car market has been driven by extreme shifts in UK transportation legislation. By 2030, the UK and several other counties will deliver on their commitment to ban sales of new diesel and petrol cars. The impact of this can already be seen in the soaring sales of electric vehicles right across the Mobility sector.
Launched in 2018, UFODRIVE has an entirely electric (primarily Tesla) fleet, along with an industry-first carbon credits-based loyalty programme. The company has already delivered Co2 savings of over 1 million kgs.
It aims to transform the cart rental market by providing 100% digital, electric and easy customer solutions. The full booking and rental process are managed via the UFODRIVE app allowing customers to reserve and drive, efficiently, autonomously, and without the need to queue at a desk.
UFODrive already operates from 17 locations across eight countries, with feedback from customers earning the enterprise the highest Net Promoter Score of car rental anywhere. UFODrive also grew by 108% during 2020, proving it operates with resilience.
Trove reported, “UFODRIVE is on a mission to provide the world’s fastest and easiest car rental experience while reducing paperwork, queues, fuel, emissions and hassle for its users. Their team will be tapping into both components of our Mobility Insurance Platform, including both insurance coverage and risk operations technology, to drive meaningful efficiencies for their growing business in the United Kingdom.”
Trov added that with its technology the UFODRIVE team will be able to monitor, manage and mitigate their insured and uninsured risks more effectively – ultimately shifting more resources toward the expansion of their business.
“We’re proud to support the team at UFODRIVE as they offer British consumers a unique sustainable mobility option – helping the country as a whole get closer to its ambitious carbon emissions goals for 2030,” an official statement said.
Insurtechs are winning the race with legacy system companies
Nestled in its own place within the world of financial services, insurance is arguably more unpopular than retail banking.
That’s hardly surprising given that, from a customer service perspective, insurance is something of an off-kilter transaction. You pay a sizable premium in exchange for a service you hope you will never have to use. This image problem is exacerbated by ubiquitous tales of insurers not paying out when it is time to make a claim.
The insurance sector has long been due to an overhaul, and this is where the disruptive force of insurtech comes in - one of fintech’s most upwardly mobile subcategories. Accordingly, last year, insurtech in the UK alone attracted £262m in investment, a growth of 60% on 2019, according to Tech Nation. Insurtech’s momentous growth has been captured in a new report by The AI Journal exploring this burgeoning sector.
What exactly is insurtech?
Put simply, insurtech refers to technological innovations that seek to make insurance cheaper to buy and more efficient to use. In a similar vein to fintech, the large, established institutions have been dipping their toes into insurtech, but it’s the disruptors who are genuinely looking to shake up the status quo, diving into and exploiting those areas that traditionalists have little imperative to explore.
Examples are price comparison sites (one of the earliest forms of insurtech that was eventually snapped up by the insurers it initially sought to disrupt), claims software, customisable policies, or even smart-tech-enabled dynamic policies whose premiums can fluctuate depending on changing circumstances.
The latter, for instance, could use someone’s fitness tracker or smartwatch to monitor fitness levels, thus reducing the premium of a life insurance policy; or track a GPS system that records the location of a car and assesses risk levels accordingly.
Most consumers tend to shop around for their insurance needs and perhaps end up buying their contents insurance with one provider, their car insurance with someone else, and their pet insurance with yet another underwriter. Managing all these different policies, with their varying renewal dates and payment terms can be complex. This has led to the increase in apps that pull everything together.
More prosaically, insurtechs are developing AI that uses machine learning to act as an insurance broker, eliminating the need for a human intermediary and therefore offering more cost-effective and impartial advice.
Insurtechs and risk
But there are some obstacles in the way of insurtech’s continued evolution.
Insurance companies are averse to risk. Understandably so, as at the crux of the industry is the role of the actuary, whose job it is to analyse and measure the probability and risk of future events. So it’s little wonder that there’s a reluctance among the traditional players to welcome the disruption that insurtech brings.
Insurance is heavily regulated, a minefield of legality and labyrinthine jurisdiction, which means the idea of shaking it up can be anathema. And why would they, when their old-school business models are working perfectly fine?
There’s an understandable nervousness and unwillingness to work with startups, who themselves need to work with the bigger firms in order to underwrite risk.
While it seems like a catch-22 situation, there is growing, if cautious, interest from insurance companies, who can see the benefits of insurance with a friendlier face, innovative solutions, and a competitive edge through differentiation. As that tentativeness dissipates, the growth of insurtech will gather even more momentum.
Tom Allen's analysis is based on the findings of a new report on the fintech and insurtech industries produced by The AI Journal.