The startup aiming to help brokers solve the short-term insurance pickle

It all started back in 2015 when the sharing economy was burgeoning, and Louise Birritteri spotted a gap in the market after booking her very first stay in an Airbnb – but realised there was no insurance policy to cover this.

The Norwich-based specialist insurance intermediary now known as Pikl (formerly Inlet) was born off the back of this realisation, founded by Birritteri who is also the chief executive. 

A previous government ruling allowed residents to freely share their home for up to 90 days, but due to the newness of the sharing economy, it wasn’t being addressed properly by insurers, she told Insurance Times.

Since then, the Airbnb market has grown year-on-year, experiencing a 62.5% increase in guest arrivals last year alone – and there are now more than six million listings worldwide.

But still there is no question for brokers selling home insurance on short-term rentals, leaving those dealing with these types of properties underinsured. Therefore, consumers with additional needs cannot be identified easily leaving them at risk.

Pikl is now working with the industry to introduce a question on this.

Last Thursday Birritteri revealed to Insurance Times at its celebratory launch party, that it has increased its staff base from five to 20 people as well as securing several partnerships as it scales up. 

It follows a £2.5m funding round last May, led by Sir Peter Wood – the founder of esure and Direct Line Group, who subsequently took a minority stake in the business.

Pricing not products

Secondly, she said, insurance products haven’t really changed a lot.

When asked why, Birritteri told Insurance Times: “I think insurers have been quite distracted with things like data enrichment strategies. With the rise of price comparison sites in the early noughties which led to natural price pressure on insurance companies, I think a lot of energy has gone into pricing and probably less so into products.”

Now with the growth of the Airbnb sector at two thirds the size of the hotel market, insurers can’t shy away for much longer.

Over the last 18 months Pikl has been working with the insurance industry to raise awareness resulting in many now taking the problem seriously.

Birritterri is no stranger to insurance accumulating over 15 years of experience in the industry, giving her a thorough understanding of the market. She began her career with Aviva straight after university in 2003, thereafter she took on various senior roles including Gallagher’s head of pricing in 2013 and following this – pricing director for Sure Thing!

Tricky business

To add to this the problem of insuring short-term rentals isn’t that easy to solve, this is because it is quite technically challenging.

“It requires changes with question sets that [means] technology changes, [as well as] changes in standards with the Association of British Insurers and Polaris. It’s not something that one insurer cannot solve, it requires industry collaboration,” she said.

Pikl has been working with the likes of these firms to facilitate these changes.

“I don’t think insurers are ignoring this, it is just a very complex consumer problem and we have been trying to be at the forefront of this. But it’s like everything in the insurance industry it takes quite a long time for people to realise there is a problem, decide whether they want to do something, follow it through and then get the traction,” she added.

Brexit woes 

Birriterri explained that traditionally insurance policies were annual, and therefore not suitable for the short-term nature of the Airbnb model – a problem is also reflected in the motor sector with the rise of shift work of Uber and Deliveroo riders.

The startup’s products cater to the insurance market as well as portfolio property managers, property agents.

Pikl will soon launch products in other markets – namely travel and motor, but at present it is focusing on the property market due to higher value claims such as injury on someone else’s property.

“We have been strengthening our underwriting team and developing an MGA. We have also been strengthening our partnerships team, we have more in the pipeline,” she said.

One challenge Pikl is facing is Brexit uncertainty, while Birriterri has hopes of expanding to Europe in the future she said that a no deal could delay many things due to regulatory changes and therefore remaining part of the European Union might be easier.