Collaborative Consumption: Collaborative Insurance
Over the last few years, the sharing economy has grown rapidly. There are now all different forms of sectors in the sharing economy, there is house sharing, loans, carpooling, and even the rental of tools. But now, there is even a sector for insurance.
What is a Collaborative Insurance? Collaborative insurance is meant to exist alongside your traditional insurance. It exists for when your insurance does not cover the problem you experience. The insurance is then meant to pay for accidental damages that occur, no matter what they are. Take for instance floods. Many home insurance policies do not cover flooding, but with collaborative insurance, you are covered.
The typical way these collaborative models offer policies to those involved is by gathering a hundred people to create a common fund. The way this typically works is that 80% of the collective fund will guarantee to pay claims and 20% will take out conventional insurance for major risks.
What the Collaborative Insurance Can Bring You In the case of home insurance, this collaborative insurance can be very important. Minor claims can be denied, or not covered depending on your deductible. Plus it’s typically a lot of work to get a small payment. By dipping into the collective pot to handle small problems, you will benefit from dealing with a lot less stress and having all the expenses covered, plus you will feel far more comfortable knowing that all your belongings are always protected.
The Work’s Already Done Obviously, this sector to the bright future. There are many different players that are popping up in this sector. One start-up, JFloat.com, offers automobile insurance in this collective pool style. Similarly, another start-up, Inspeer.me, reduces insurance costs by allowing you to increase your normal deductible by adding a secondary form of protection.
This type of insurance is a new form of self-insurance. Through collective insurance, individuals can take control of an area that often seems very foreign and hard to manage.
