insureNXT|CGN: How do you actually insure innovations? The example: e-scooters
10.01.2020
How do you actually insure innovations? The example: e-scooters
Expert: Frank Edelmeier, Head of Business Unit Motor Transport, Gothaer
When designing tariffs and offers for products for which little or no information is available at this stage (e.g. expected accident frequency and severity, number of users and road traffic behaviour), insurers can use three approaches to help determine the level of the insurance premium. Frank Edelmeier, Head of the Motor Business Unit at Gothaer, explains what needs to be taken into account for a new means of transport such as the e-scooter.
1. comparison with related products
Here, insurers refer to related products for which the important data required for calculation are already available. In the case of the e-scooter, for example, a comparison with the classic moped is obvious, as this has been available in large numbers for a long time and there is a correspondingly large amount of damage experience. e-scooters are very similar to mopeds in terms of their role in road traffic, although the first are likely to suffer damage slightly more frequently, as users are unlikely to have much experience with the new vehicle. The equipment also differs, as e-scooters, for example, do not have direction indicators. On the other hand, the severity of accidents could be somewhat lower, as e-scooters have less bulk that is effective in the event of a collision. In line with these considerations, we are therefore experiencing overall that many insurers have transferred the existing moped insurance premium in the same amount to e-scooters. But: Just as with mopeds, e-scooter insurance is also considered a “forfeiture policy” and expires at the end of February every year. The rates can therefore be adjusted annually and will thus be able to orientate themselves more and more to the actual damage experience over time.
2. assessment of specific risks
The second step is to weigh up particular risks and identify target customers. In the case of e-scooters, for example, this involves the question of whether an insurer would like to concentrate more on private owners and users or whether it would rather focus on the large rental fleet providers such as Lime, Circ or Tier. We as Gothaer have weighed up the risk for us and are focusing more on the private customers, whom we like to insure with a focus on their entire mobility.
3. comparison with the market
Finally, insurance companies orient themselves on the market and compare their own rates with those of other insurers. Whether one wants to position oneself as “the cheapest”, in a healthy midfield or rather as a “premium partner”, has a lot to do with the overall self-image of the company.