Q&A with Austin Ledgerwood of Cover Genius
Austin Ledgerwood is head of Strategic Partnerships—Mobility, Americas for Cover Genius
E-scooters are an example. They’re really starting to see an uptick in accidents, and people don’t know that they have options to cover themselves. There are not a lot of products out there to give the right coverage. That’s one of the things that we’re really focused on and working with our insurance partners on—creating products that actually fit the demand and the need.
There is a growing call for insurance on demand versus the traditional coverages offered today. The traditional insurance offerings do not allow for flexibility in how one uses mobility services. The impact is not only to the insurance companies for not having flexible coverage but also to the mobility consumers who are putting themselves at great risk with no coverage.
One of the key things is that insurance can be very costly for the fleet management companies. That translates to higher costs for the driver, because they’re going to pay for it in the long term through that subscription fee. If I use Clutch or Flexdrive, which is another subscription company, what if I were to have coverage that translates to me no matter who I’m using through subscription? How about if I had coverage when I used an e-scooter this week, and then, while traveling with my family, I jumped in an AmeriDrive subscription car in South Florida and was covered regardless of what I’m driving? As an individual, why wouldn’t I want to be covered with all the extra or added coverage I want or need? The non-owner [product] is really going to revolutionize the auto insurance world.
When you’re driving someone else’s car in subscription, the insurance is covered by the fleet operator. That might be a dealership. That might be an OEM. You’re set to their limits. If one of them says we’ll cover you to the state minimum, that might be only $100,000 to $300,000 of coverage. If you get into a grave accident, that will go away very quickly. Why wouldn’t I want additional coverage or to manage my coverage and have control of that? The non-owner [policy] would cover that.
If I’m using car sharing and someone breaks into the car and steals my laptop and the Tiffany bracelet I just bought my wife, I’m out of luck because my personal items are not covered in those scenarios.
If you’re getting on an e-scooter or e-bike, unless there is a malfunction of the scooter or bike, you’re liable for anything that happens on it. When you go on it, there’s no way for you to add on any protection. There’s a real inherent risk.
The non-owner [coverage] is that product that is for the next generation—the millennials and individuals that don’t want to own a car. They just want to use one when they want to use it. You pay for the coverage monthly. It’s usually much cheaper than a full auto policy because you’re not covering the car, and it would cover however you’re transporting yourself.
You have several different verticals. You have digital retailing, which is the advent of organizations like Carvana, Vroom or even Tesla, when an individual can completely do a transaction online. I don’t go to a dealership. I select a car online, and they deliver it to me. One of the things we’re working on is enabling the ability for a car insurance quote to be provided at the time of the transaction, instead of having to go through external links or anything of that nature. We’re very much focused on that aspect. We are in talks with a couple of very large digital retailers.
You have the new car ownership alternatives, which would be the subscription models and car-sharing models. We’re looking at integration with two large subscription companies. That would revolve around the non-owner product. If I subscribe to a vehicle from AmeriDrive or Clutch, I could do a non-owner policy, and that would cover my personal items. It would give me added liability coverage, and it would follow me regardless of what platform I’m on and what I’m driving. It’s really geared around me and not around the car.
Then, there’s the rideshare market—the Ubers and Lyfts. If I’m driving with them, do I want the opportunity to have higher coverage? Within rideshare, there are usually different periods for which coverage is available. The different rideshare companies give good protection, but it varies on what you’re doing, and there are limits to what they provide. It’s not just an open checkbook. We believe there is a huge value in offering up additional coverage to the drivers. I could even foresee in the future there are options for coverage for riders.