The Company Shaping the Future of Motor Insurance

In this interview, Alan Inskip, the CEO at Tempcover, talks about the radical shift that is currently happening in motor insurance. How is consumer behaviour changing, and what does the future hold for insurers willing to embrace these changes?

What key issues within insurance gave Tempcover the idea of offering short term car and van insurance?

The motor insurance industry has developed an unenviable reputation for being cumbersome, inflexible and unwilling to embrace change. In the past, adding additional drivers to an existing policy was time-consuming and confusing – with customers being unclear about what is and isn’t covered – often leading to motorists incurring considerable out-of-pocket costs and losing their No Claims Discounts following an accident. The same could be said for trade professionals who would need to temporarily insure seasonal workers to drive their vans during busy periods.

With the rise of the sharing economy we had a lightbulb moment in 2006 – to provide insurance policies that offer truly flexible cover for the time drivers actually need, with no long-term commitment or auto-renewals. The UK’s first InsurTech company, Tempcover, was born the next day. Today we are a leading provider of short-term motor insurance policies that last anywhere from 1 hour to 28 days.

How has consumer behaviour shifted in relation to buying motor insurance? And how has Tempcover managed to adapt?

Consumers are shifting towards digital services and in the modern age of instant gratification, they are increasingly unwilling to deal with a time-consuming and complicated question set and application process, in addition to unclear terms and conditions relating to their cover. We identified this gap in the market and have entirely overhauled our fully-digital user experience based on direct feedback from customers – with multiple-stage research and testing resulting in a fit-for-purpose user experience based on customer demands and expectations.

We have also worked with our underwriting partners to simplify the question set whilst maintaining full underwriting integrity by moving standard questions into the declaration, which is written in simple straightforward English. The end result is that our customers can access policy documentation and be comprehensively covered to drive their vehicle within 90 seconds, following a few simple and light-touch steps via the Tempcover app or website. 

What role will technology play in the future of buying temporary motor insurance? How will it evolve? 

Technology, more specifically InsurTech, is at the very heart of the future of temporary motor insurance. We will continue to see the utilisation of the latest technological innovations such as data analysis, artificial intelligence and machine learning to enable insurance products to become more agile and flexible in line with modern consumer demand. The evolution of this technology will continue to dramatically simplify the process of how insurance is purchased and consumed.

How can InsurTechs and incumbents work together to accelerate the innovation within vehicle insurance? Should they even?

Temporary vehicle insurance is a solution that can be used as an alternative or to complement annual insurance, so collaboration is key to innovation in the motor insurance sector. There needs to be a relentless desire to improve the customer experience by offering the best value proposition in the market but that cannot always be achieved unilaterally.

Incumbents do not always have the agility and flexibility of InsurTechs, which in turn do not always have the underwriting capabilities and large customer database of the incumbents. The merging of these USPs certainly holds the potential to create the most agile and cost-effective motor insurance solution for customers.

Looking forward, what do you think will be the key enablers for driving more innovation and adaptability within motor insurance?

Insurers no longer enjoy the luxury of brand loyalty as consumers become increasingly willing to switch to a brand that they perceive to be of better value to them. All motor insurers are therefore under constant pressure to adapt to these shifting trends through digital innovation, and this ultimately benefits the consumers, who are getting a far more flexible and personalised offering that provides them with the best value for money. This is also a major benefit to the industry, whose days of slow, inflexible and costly motor insurance are numbered. Industry players that embrace this change will flourish. Those that fail to adapt will be left behind.