Alberto Perez, Co-founder and CPO

The insurance industry is undergoing a paradigm shift. At Democrance, we believe in a simple yet powerful principle: “Stop selling insurance, help your customers buy insurance”. This philosophy is at the heart of embedded insurance, a revolutionary approach that’s transforming how people access and purchase insurance products.

Redefining Insurance: From Selling to Helping

Embedded insurance isn’t just a new distribution channel; it’s a complete reimagining of the insurance experience. But what exactly is it?

At its core, embedded insurance is the seamless integration of insurance products into the customer’s journey when purchasing other goods or services. It’s about presenting insurance not as a separate, often complex product, but as a natural, value-adding component of something the customer already wants or needs.

In more detailed terms, embedded insurance allows customers to buy coverage or protection as an add-on or feature of another product or service. It’s part of a broader trend of embedded finance that brings insurance directly to the customer at the point of sale or within the purchase flow. The result? Affordable, relevant, and customized insurance that customers might not even realize they need – until it’s presented in context.

Why Embedded Insurance Resonates with Customers

Embedded insurance aligns perfectly with our mission to help customers buy insurance rather than selling it to them. Here’s why:

1. Relevance: Insurance is offered in the context of a purchase, making its value immediately apparent.
2. Simplicity: The buying process is streamlined, often requiring just a single click.
3. Trust: Customers are engaging with brands they already know and trust.
4. Affordability: Integration often allows for more competitive pricing.
5. Convenience: There’s no need to seek out insurance separately – it’s right there when needed.

Empowering Customers Through Choice

Embedded insurance can be implemented in several ways, each designed to empower customers:

1. Soft-embedded (opt-in): Customers actively choose to add insurance, putting the power of decision in their hands.
2. Hard-embedded (opt-out): Insurance is included by default, ensuring coverage unless the customer decides otherwise.
3. Invisible insurance: Coverage is seamlessly built into the product or service, providing protection without any additional action required.

These approaches aren’t about pushing products; they’re about presenting options and letting customers make informed decisions.

The Massive Potential of Customer-Centric Insurance

The shift towards helping customers buy insurance through embedded models is not just good for consumers – it’s good for business. Industry experts project that $5-10 trillion of Gross Written Premium (GWP) could be distributed through non-insurance brands over the next decade. This represents a massive opportunity to reach customers in new, more effective ways.

Innovative Models for Customer-Focused Insurance

To truly help customers buy insurance, companies are adopting various innovative models:

1. Creating Ecosystems: Like Ping An, which evolved from an insurer into a platform deeply integrated into customers’ daily lives.
2. Joining Ecosystems: Partnerships such as Uber+Allianz and Airbnb+Zurich Insurance, bringing insurance to customers where they already are.
3. Orchestrating Ecosystems: Companies like Cover Genius that specialize in facilitating embedded insurance across multiple platforms.
4. Covering Your Own: Tesla’s approach to insuring its vehicles, using deep product knowledge to offer tailored, integrated coverage.

Designing Products with Customers in Mind

To effectively help customers buy insurance, we need to rethink product design:

• Start with the customer’s needs and perspective, not the insurance technicalities.
• Simplify and declutter, creating products that are easy to understand and purchase.
• Leverage existing data to minimize questions and friction in the buying process.

Streamlining the Customer Journey

For embedded insurance to truly help customers, the entire process must be frictionless:

• Integrate insurance seamlessly into the primary purchase flow.
• Focus on essential information, avoiding overwhelming customers with unnecessary details.
• Aim for a low-cost, smooth experience that feels natural to the customer.

Technology: The Enabler of Customer-Centric Insurance

At Democrance, we understand that the right technology is crucial to helping customers buy insurance effortlessly. That’s why we’ve developed robust APIs and microservices designed specifically for embedded insurance. Our solutions allow companies to rapidly deploy embedded insurance capabilities, creating seamless, customer-friendly experiences without the need to build complex systems from scratch.

The Future is Customer-Centric

Embedded insurance represents a fundamental shift from selling insurance to helping customers buy it. By making insurance more accessible, relevant, and integrated into daily life, we’re moving towards a future where protection is a natural part of every significant purchase or life event.

As we continue to evolve the insurance landscape, companies that embrace this customer-centric approach – partnering with innovative technology providers like Democrance – will lead the way in this exciting new era of insurance.

Remember: Stop selling insurance. Start helping your customers buy the protection they need, when they need it, in the way that works best for them. That’s the power of embedded insurance, and that’s the future we’re building at Democrance.