(Image source: Uber.)
The on-demand sharing economy, characterized by companies such as Uber and Airbnb, has emerged suddenly, creating new risk exposure scenarios, many of which are yet to be adequately covered by insurance. Slice (New York) an insurance technology startup has announced the launch of an insurance distribution platform designed to address such emerging risks. The company has raised $3.9 million in a seed round led by Horizons Ventures and XL Innovate.
“Insurance is anything but transparent today and it is hard to get the coverage you need when you need it,” comments Tim Attia, CEO and co-founder of Slice. “The on-demand platforms have changed the game; insurance must be truly frictionless and as seamless as transactions on these platforms.”
Significant Personal Risk
The problem Slice seeks to solve is the difficulty participants in the on-demand economy currently face in obtaining insurance coverage. Traditional insurance products are not designed to address the on/off and hybrid personal/commercial nature of the on-demand, sharing economy. The result is that many small business owners are taking on significant personal risk, often without even being aware of the fact. Even when owners understand the risk, they typically struggle to find coverage. A recent survey found that 80 percent of rideshare drivers are looking for appropriate commercial insurance coverage.
Slice, an MGA which works with primary carriers and reinsurers, describes its offering as reimagining insurance for the new economy, using design, technology and data. The Slice on-demand insurance platform allows participant to easily purchase insurance when they need it with the push of a button. The first product launched on the platform will be a proprietary pay-per-use policy for Uber and Lyft drivers that covers the drivers from the time they turn on the rideshare app until they turn it off.
“Our customer is the Uber driver or Airbnb host—the person acting as a business in the on-demand economy,” explains Attia. “We will initially look to also market through the on-demand platforms, such as Uber, Lyft, Airbnb, Homeaway.”
Significant Market Opportunity
“We believe there’s significant market opportunity for a company like Slice to create new products for the on-demand economy,” comments Frances Kang, Horizons Ventures. “Its algorithmic approach and data-driven pricing model are truly innovative in the insurtech world. We are excited to see Slice bringing more peace of mind and continuing improvement of the customer experience for the on-demand economy.”
“We are very impressed by both the insurance and technical knowledge of the Slice founders whom we have tracked since the company’s inception,” comments Tom Hutton, Managing Partner, XL Innovate. “Slice is addressing this need with a unique solution that incorporates both software technology and insurance. This is truly an insurance technology solution.”