Coverly Closes The Book on Its Insurtech Adventure, as SMEs Take Covid Hit

It is getting tough out there, as companies conserve their capital and look closely at every insurtech start-up to look for hard cash value and good long term brand value.

The latest to close its book is Coverly, which launched back in February 2019 and offered various product lines to SMEs. On demand business insurance is a great idea, but as the effects of Covid-19 and the subsequent lockdown filter through the SME sector in the UK, there’s no doubt that margins will be tight and many independent sole traders will shrug and trade with the bare minimum of cover until mid-2021, or whenever a vaccine is available.

Without a mass vaccination programme it is hard to see the nightlife, hospitality, events and travel sectors of the UK economy getting back to normal. This means many small companies will not only give up on business insurance, they may have to give up altogether. Very tough times ahead.

Coverly offered this advice earlier today;Don’t worry, you are still covered. Our closure does not affect your current policy or cover. All active policies will remain so until their expiry date. If you need to change anything on your current policy, we are still here to help you manage your cover requirements.

I am an existing customer and have a policy due for renewal. What does this mean?If you are an existing customer and you have already received a renewal quote, then you can renew your policy if you choose to do so and we will service your policy as normal until it expires or you cancel it. If your policy is due to renew on or after the 14thAugust 2020, then your policy will cease at its expiry date and we will not be able to renew your cover.

What if I need to make a claim?If you need to make a claim, the process will stay the same. You should contact Langley’s Claim Services directly on 0845 207 7453, quoting your policy number. Further details can be found here.

I have been a customer in the past and want to purchase another policySorry, we are no longer issuing new policies and cannot offer any new quotes. As of 17th July 2020, we are no longer offering small business insurance as we are sadly closing.

I already have a quote from Coverly. Can I still buy a policy?

If you have had a quote from Coverly before Friday 17th July 2020, then the quote will be valid for 28 days from the date you received it and you can still purchase with the link in the email. After 28 days, the link will no longer be valid and you will be unable to purchase insurance through Coverly.

According to Keith Stonell, MD, EMEA, Guidewire Software, “Even before the challenges created by the pandemic, a lot of insurtechs that were trying to disrupt the industry were struggling to attract enough customers to keep investments coming in.”

“The figures released by Lemonade ahead of their recent IPO are testament to just how tricky it can be even when you’re regarded as an insurtech market leader,” Stonell continues, “and it will be incredibly interesting to see how their business progresses.”

“There is every chance that the circumstances we now find ourselves in may present opportunities for disruptive insurtechs. The pandemic’s economic effects have shown consumers the importance of having the right insurance protection for their livelihoods. In a consumer study we commissioned, almost one in three respondents said they will be more careful in understanding what they are covered for, as well as revealing a new appetite for under-insured areas like income protection and even digital identity.

Changing attitudes might benefit those nimble insurtechs who speak in plain English, offer flexible products, and keen pricing designed for volatile times;  although you can’t get away from the fact that in times of uncertainty, it is less likely consumers will take risks. This might not only stymie insurtechs but also affect the attempts by other brands and institutions, including Amazon and retail giants, to enter the insurance space aggressively.

As the closure of Coverly and others demonstrates, being successful in the insurance industry is not easy. Scaling an insurtech is difficult and so collaboration with incumbent insurers is a more sustainable route to success than trying to turn the industry on its head. This is aided when insurers can access pools of curated, quality insurtech offerings that are already assessed – especially important in these uncertain times.

This, of course, requires insurers to have the technological systems in place to facilitate such collaboration, but given the maturing of cloud models and the acceleration of digital change over recent months, that problem could soon be a thing of the past.”

About alastair walker 10896 Articles
20 years experience as a journalist and magazine editor. I'm your contact for press releases, events, news and commercial opportunities at Insurance-Edge.Net

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