Disrupting the Car Insurance Industry

The London-based start-up Cuvva competes with incumbents by making it easy for drivers to buy pay-as-you-go insurance.

Disruptive ventures arise from mobile device ubiquity, data-powered AI and digital platforms that connect buyers and suppliers in new ways. They are reshaping industries such as transportation (e.g. Uber, Lyft, Didi Chuxing), hospitality (e.g. Airbnb, FlipKey), payment services (e.g. PayPal, TransferWise) and many more.

Conservative by nature, the insurance industry has been slow to embrace new digital business models and take on disrupters. But it won’t be able to dodge the challenge much longer. Consider ZhongAn, the Chinese online insurer created in 2013 by e-commerce giant Alibaba, social network Tencent and insurer PingAn. ZhongAn has already sold more than 7 billion policies – mostly shipping return and flight delay insurance – to half a billion customers, creating massive waves in the industry with fast, innovative and customised products sold only online.

Hourly car insurance cover

Freddy Macnamara, the founder and CEO of London-based, mobile-only insurance broker Cuvva, is addressing several market frictions in the car insurance industry. Most people dread buying car insurance – an expensive product that’s only needed in case something bad happens. After all, it is a product that few people like and even fewer people understand.

Launched in October 2015, Cuvva came about because Macnamara wanted to get insurance on an hourly basis so he could drive other people’s cars. He saw that car insurance is one of those things that people instinctively associate with pain. He decided to use technology to make it as hassle-free as possible.

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