Embedded Insurance: The future of insurance distribution is now!

Embedded Insurance: The future of insurance distribution is now!

The topic of embedded insurance is increasingly establishing itself as a dynamic field of innovation in insurance sales. A new study by InsurLab Germany, in collaboration with the University of St. Gallen and crossconsulting, examines the maturity and future potential of this concept. The analysis is based on 47 use cases, 35 expert interviews and a comprehensive survey of over 2,000 end customers.

According to the study reported it financial magazine of quantitative results showing that soft or linked embedding accounts for 53.7% of cases. This means that additional policies are often offered during the online purchase process. Another 19.5% are Visible Bundled models, while Invisible Bundled models account for just 9.3%. In addition, the proportion of related embedding that is not fully embedded is also 19.5%.

Market overview and dominance of property insurance

The study shows that property insurance dominates with a share of 42%, followed by travel and mobility products with 19%. Liability insurance accounts for 14% of use cases, while life and health insurance combined only account for 7%. The extensive analysis of these different models provides valuable insights into insurance market trends.

The success factors for embedded insurance are diverse. In particular, depth of integration, brand strength and convenience play a central role. Study results from the analysis show that deeply embedded bundled models have high growth potential, as they are currently implemented in less than a third of cases. Examples of successful implementations include Zurich's camper protection solution and Airbnb's AirCover insurance.

Sales trends and recommendations for insurers

A notable aspect of the study is the strong halo effect. Combining a strong sales brand with an established insurer can increase the likelihood of closing in certain product categories by up to 2.8 times. InsurLab Germany highlights that embedded insurance is not only changing distribution, but also redefining the role of insurance in digital ecosystems.

The study provides recommendations for insurers and partners. It is recommended to view embedded insurance strategies as an integral part of the sales architecture, with a focus on deep process integration, clear target customer segmentation and consistent brand partnerships. The goal remains to expand embedded insurance from a mere checkout add-on into a sustainable growth driver.

The full study is free to download and provides comprehensive information on definitions, market overviews, best practices and recommendations for companies to strategically use embedded insurance. These insights are particularly relevant in the context of advancing digitalization, new data streams and changing customer expectations in the insurance industry.