Grabbing an Uber? Now You Can Buy Your Own Insurance for the Ride
14 June 2018 - 9:19PM
Dow Jones News
By Leslie Scism
Chubb Ltd. has teamed with a technology startup to sell
insurance to passengers of ride-hailing services like Uber
Technologies Inc. to cover medical and other costs in the event of
an accident.
The startup, Sure Inc., has developed a product for passengers
to purchase accident and death coverage on an on-demand, per-day
basis via a smartphone application. It covers costs of injuries
sustained when traveling in a ride-sharing vehicle.
One of the world's biggest property-casualty insurers, Chubb is
part of an industrywide race to develop new products as the car
industry goes through a monumental shift. Ride-hailing services
continue to rise in popularity, while growth in autonomous vehicles
will shift driving from humans to computers.
Both trends threaten to cut into one of the industry's biggest
product lines in the U.S.: car insurance bought by individuals.
These polices are estimated to deliver $220 billion in premiums in
2018, according to trade group Insurance Information Institute.
Chubb will underwrite Sure's ride-sharing policies, which will
pay up to $10,000 in medical costs per accident and include a
$100,000 death benefit, the firms said. It costs $2.40 for a
24-hour period.
In the U.S., passengers typically are covered by liability
insurance provided by a ride-sharing firm itself. For example, Uber
provides a total of $1 million of coverage per accident, according
to its website. Uber's insurance program typically includes claims
for medical expenses and loss of income, and it kicks in regardless
of whether an Uber driver or an uninsured other motorist caused the
accident, according to the firm.
Sure's new coverage, called RideSafe, is aimed at filling
potential gaps in such insurance payments to riders, said Wayne
Slavin, founder and CEO of Sure, based in Los Angeles and New York
City.
Proceeds from RideSafe policies also could be used by buyers to
cover deductibles on their health-insurance policies, in the event
of a costly accident in which the passenger is drawing on a
health-insurance program, Mr. Slavin said.
The move from Chubb is one of many by insurers to ramp up
innovation as many consultants predict evaporation of a big chunk
of car-insurance premiums in coming decades, assuming breakthroughs
in driverless technology that would lead to sharp reductions in
wrecks.
While that could take decades, the landscape already is changing
as ride-sharing networks grab more business. Taxis and ride-sharing
vehicles could account for about a quarter of miles traveled
globally in a little over a decade, some analysts estimate.
"There are many people, carriers and insurtech startups thinking
of the implications of the ride-hailing world, the potential for
gaps in insurance coverage and the opportunity to offer innovative
new products, " said Michael Halsband, a partner at law firm
Drinker Biddle & Reath LLP, whose focus includes
insurance-industry mergers and acquisitions as well as insurtech
startups.
For carriers, these early products provide opportunities to
collect data about how the personal-transportation world is
evolving, Mr. Halsband said.
The ride-hailing offering with Sure reinforces "our commitment
to supporting efforts around digital transformation and providing
consumers with peace of mind in emerging markets," said James
Walloga, a senior executive at Chubb North America.
The product launch follows an announcement in December that
Waymo LLC, the driverless-car unit of Google parent Alphabet Inc.,
has teamed with California technology startup Trov Inc. to cover
future passengers for lost and damaged property and for injuries.
Waymo and auto makers like General Motors Co. are seeking to put
commercial fleets of autonomous vehicles on public roads.
The coverage would automatically be provided by Waymo, not sold
separately to passengers as Sure is doing. Trov policies would be
underwritten by a unit of reinsurer Munich Re.
Sure, which already provides insurance products such as
smartphone protection, said that future iterations of RideSafe
would include coverage for passengers riding in autonomous
ride-sharing fleets. Sure also is aiming for coverage on a per-ride
basis.
(END) Dow Jones Newswires
June 14, 2018 07:04 ET (11:04 GMT)
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