The delivery industry is booming, thanks to the rise of e-commerce, on-demand services, and the pandemic. However, it also faces many challenges, such as high costs, low margins, customer expectations, and risks of accidents, theft, or damage. That’s where insurtech comes in. Insurtech is the use of technology innovations to improve the efficiency, affordability, and customer experience of insurance. In this blog post, we will explore how insurtech is changing the delivery industry, what are some of the new digital solutions and ideas, and who are the big players and the newcomers in this space.

Why delivery insurance matters

Delivery insurance is a type of insurance that covers the goods or services that are being delivered from the point of origin to the point of destination. It protects the sender, the receiver, and the delivery provider from financial losses in case of unforeseen events, such as delays, loss, theft, or damage. Delivery insurance can also cover the liability of the drivers or shippers in case they cause injury or property damage to third parties.

Delivery insurance is important for several reasons. First, it provides peace of mind and trust for both the customers and the delivery providers. Customers can rest assured that their orders will arrive safely and on time, or they will be compensated if something goes wrong. Delivery providers can reduce their exposure to risks and avoid costly lawsuits or claims. Second, it can increase customer satisfaction and loyalty. Customers are more likely to order again from a delivery provider that offers reliable and transparent insurance options. They are also more likely to recommend the service to their friends and family. Third, it can create a competitive advantage and a new revenue stream for the delivery providers. Delivery providers can differentiate themselves from their rivals by offering better and cheaper insurance options. They can also generate additional income by charging a fee or a commission for the insurance service.

How insurtech is disrupting the delivery insurance market

Insurtech is disrupting the delivery insurance market by using advanced technologies, such as artificial intelligence, blockchain, data analytics, and Internet of Things, to offer more customized, flexible, and convenient insurance solutions. Some of the ways that insurtech is innovating the delivery insurance market are:

On-demand insurance: This is a type of insurance that allows customers to buy coverage for a specific delivery or a specific period of time, instead of paying a fixed annual or monthly premium. For example, Secursus is an online platform that allows customers to insure their valuable parcels up to £90,000 with a few clicks. Customers can choose the level of coverage, the duration, and the carrier, and pay only for what they need. Secursus claims to save customers up to 70% compared to traditional insurance providers.

Embedded insurance: This is a type of insurance that is integrated into the delivery platform or app, making it easier and faster for customers to access and purchase insurance. For example, Uber maintains auto insurance on behalf of its rideshare and delivery drivers, covering them from the moment they tap GO to wait for a trip request, to while they’re driving to pick up a rider or goods, and until the trip ends. Uber partners with top national auto insurance companies to provide this service, which meets or exceeds the required coverage in most states.

Peer-to-peer insurance: This is a type of insurance that relies on the collective power and trust of a group of customers, who pool their money together to cover each other’s claims. For example, Lemonade is a peer-to-peer insurance platform that offers renters and homeowners insurance, as well as pet health insurance. Lemonade uses AI to handle the claims process and pays out claims in seconds. It also donates the unused premiums to the charities of the customers’ choice, creating a social impact.

Data-driven insurance: This is a type of insurance that uses data from various sources, such as sensors, GPS, cameras, or smartphones, to assess the risk profile, the behavior, and the preferences of the customers, and to offer personalized and dynamic pricing and coverage. For example, INZMO is a digital insurance platform that allows customers to insure their bicycles, scooters, electronics, and smartphones in seconds, whether they are new or used. INZMO uses data from the devices to verify their condition, to prevent fraud, and to adjust the premiums according to the usage and the location.

And a few words to conclude

Insurtech is a game-changer for the delivery industry, as it offers more affordable, convenient, and customer-centric insurance solutions. Insurtech also creates new opportunities and challenges for the delivery providers, who need to adapt to the changing customer expectations and the evolving regulatory environment. The insurtech and delivery industry is a dynamic and exciting market, with many players competing and collaborating to shape the future of insurance and delivery.