Embedded insurance: What to know
Embedded insurance is a coverage option presented directly to a customer at the point of sale, eliminating the need to shop elsewhere for insurance. The market category is predicted to grow more than six times by 2030, resulting in an estimated $722 billion in gross written premiums. For MGAs, brokers, and wholesalers, embedded insurance is an opportunity to integrate add-on or ancillary coverages with other products and services.
Here’s an example: An MGA adds online premium payments to its website. When a homeowner pays their bill, the system identifies a missing umbrella policy and offers a pre-filled application and quote. This process allows customers to conveniently purchase additional coverage during their existing interactions rather than shopping elsewhere.
The key benefits of embedded insurance
Embedded insurance is relatively new in the market, but it is an exciting opportunity for MGAs. With these products, MGAs can:
- Interact with customers online
- Offer a wide-ranging catalog of coverage options
- Personalize insurance products to meet individual customers’ needs
- Allow customers to purchase coverage instantly so they don’t have to navigate separate portals and applications.
The key challenges of embedded insurance
Although there is tremendous opportunity for MGAs to flourish in the embedded insurance space, there are also challenges to overcome. To maximize these products, insurers have to:
- Update technology to solutions that can collaborate with various embedded service providers
- Guarantee the systems’ ability to securely share information and data
- Ensure that all systems comply with insurance regulations across the different industries involved.
InsurTech solutions can make embedded insurance happen
The good news is that an embedded insurance solution can be easily integrated into any existing operating system through an open application programming interface (API). API InsurTech is helping insurers and wholesalers offer more tailored insurance solutions across various platforms and services, making it more accessible and convenient for customers to purchase all the coverage they need from a company they know and trust.
Integrating insurance products into existing commercial transactions enables customer convenience and fosters trust through familiar channels. Insurers and wholesalers can capitalize on this trend to expand their reach and offer personalized, on-demand coverage – paving the way for a more streamlined, accessible, and customer-centric insurance landscape.
Learn more about Vertafore’s focused InsurTech solutions that deliver the most comprehensive support for MGAs.