Picture an HGV versus an ebike, on the same road trying to get to the mini-golf course (why not, hey?).

They’re both stuck in traffic, as it’s a Sunday and everyone has the same idea. Sure, the HGV can find an alternative route, make a fifteen point turn, try a different road, whereby the driver has to wait as on-street parking means one way traffic.

Meanwhile, the person on the ebike has already parked up and got the golf clubs and a smoothie.

In this little scenario, the HGV represents an insurance company, while the ebike is an insurtech. The lorry has a lot of clout and a big engine, but it can be difficult to manoeuvre, which means that making changes can take time and prove very awkward. An insurtech, on the other hand, is lighter on its wheels. It’s able to change direction pretty quickly to find the best route, thanks to its size and the technology available.

Why are we going on about bikes and lorries? Because it matters to you, and here’s why.


Better use of data means better coverage

No, we’re not talking about 5G but you could be forgiven for thinking we are.

The insurance industry, as a whole, is very aware of the importance of data, and specifically, how information can be used to give customers a better experience and a fair price. Think of it as the sat nav for the HGV plotting out the most efficient route. The trouble is, the larger the vehicle, the longer it can take to implement changes.

Insurtechs, having emerged on the scene a few hundred years after insurance came to be, have adopted systems and business models which can allow them to change direction very quickly. So if they’re getting feedback suggesting another route, they can act on it.

Better data means more bespoke options when it comes to your insurance. Its data which allows insurtechs to adjust pricing and even make for greater allowances when it comes to cover. By building a business based on insight, and growing with new information or opportunities that come up, insurtech’s like Arma Karma can offer the best possible price, donate to charity on your behalf, and still give you cover that’s been created for you especially, based on the items you want to cover.

Compare this to a contents insurance policy which works on a base level cover limit – normally a few thousand pounds, which may not be what you need.


Less admin, less costs

The other big difference is around processes. You’ll probably pay for admin fees when making a change to an annual policy. This is because making changes is, for some but not all traditional insurance companies, is an intensive, manual process. Making a switch to a better system could take months. It could also come at a great cost for a larger, more established organisation, not to mention added risk if it turns out to be something other than expected. It would be like the lorry finding a better route, starting out on their journey, only to hit roadworks along the way. But they’ve committed now so they’ll inch head.

Delays, rigid systems and ingrained processes don’t equal flexibility for the customer as you’d have probably guessed. They might have offered a good price at first, only for these to creep up year on year. Thanks to the FCA’s approaching ban on price-walking, this will be a thing of the past, but it will mean a slight increase from those rock-bottom introductory prices.

If you’ve created a company that can adapt from the outset, that means less manual administration, and, in our case, no fees when you cancel and make amends to your subscription. And while we’re on it, the lack of clunky systems means we can offer a monthly subscription instead of an annual policy.

All of this means that there’s never been a better time to demand, and expect, more from your insurer.

Get a quote to see how Arma Karma can offer you flexibility in covering only the items you want to protect.