11 Jun 2020
Posted in Insurance
Cycling boom a rare opportunity for insurers during pandemic, says GlobalData
Demand for bicycle insurance is set to soar as consumers look to avoid public transport during the pandemic, and digitally savvy insurers should capitalize. GlobalData research shows that the demand for bicycle insurance has increased in recent years, although it is still not a particularly common product. However, demand will increase as people return to work, and insurers offering simple and digital products will be best-placed to win new customers.
GlobalData’s UK SME Insurance Surveys, conducted between 2017 and 2019, show that SMEs increased their use of the Cycle to Work scheme between 2017 and 2019. A total of 35% of SMEs offered the scheme to either all employees or management only in 2019, compared to 24% in 2017.
GlobalData insurance analyst, Ben Carey-Evans, commented: “This shows that interest in the scheme, and cycling as a means of transport, was already gathering momentum. However, it also shows that a considerable percentage (64.9%) still didn’t offer the scheme to any employees. People will be very wary about returning to work while the virus is still around, and providing encouragement and funding for employees to cycle to work could be one way to reduce that concern. Employers can look to make offices as safe as possible, but the issue for many employees will be busy commutes to and from work, where social distancing is not feasible.”
Similarly, GlobalData’s 2018 and 2019 UK Insurance Consumer Surveys show that take up of one-off item insurance for bikes in the UK increased from 5.9% in 2018 to 9.8% in 2019. This also shows a rise in demand but that there is still a huge opportunity for growth for insurers. Insurtech Urban Jungle stated that it saw a 60% uptick in bike insurance enquiries in May 2020, which shows demand is already rising.
Carey-Evans continues: “The key for insurers will be to make it as easy as possible for customers, whether it is as an add-on to home contents policies or a standalone insurance product. It looks to be a strong area of opportunity for insurers, and digital startups like Urban Jungle are well placed to capitalize”.