Not all new insurance modes are being built with the goal of replacing big companies. Bought By Many, a U.K.-based insurance start-up in its fourth year, operates as a broker between insurers and customers, helping both in the process.
It looks to leverage the buying power of groups, similar to the way Groupon can get businesses to offer discounts by guaranteeing customers. But instead of using that collective buying power to bring about discounts, Bought By Many uses the leverage to secure lower premiums for individuals seeking similar insurance coverage.
And while the company says that leverage has led to about a 20 percent reduction in premiums for groups, it's also brought coverage to customers who have notoriously had a hard time finding insurance in the first place. Pet owners, for example, were among the first who were able to demand more comprehensive policies that included specialized coverage for problems that are often unique to a specific breed. Now, Bought By Many boasts over 100 different pet groups, and co-founder Steven Mendel says it's exactly that same specialization and group buying power helping elder customers and those with existing conditions find their perfect policy at a fair price.
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That's also helping insurers maintain satisfied customers. "We help them target the risks they want, but at a lower cost and more precisely than they can reach themselves," he said.
After closing its second round of funding with private investors, Mendel says the company is looking to broaden coverage into other areas, such as policies negotiated specifically for employees at start-ups, and will look to expand operations into another country. But due to the U.S. insurance regulations Uvamo knows all too well, don't expect Bought By Many to cross the pond anytime soon.
And while the solutions of Uvamo and Bought By Many may differ in structure, Mendel says the sleepy industry's problem they are attempting to fix is one and the same. "Insurance hasn't changed for decades," he said. "Yet the rest of the world has moved on enormously."