Delivering mobility as a service will require investment from insurers – QBE

Successfully delivering mobility as a service (MaaS) means insurers have to not only understand “the attitude to risk and managing risk within these new mobility solutions” but they will also have to stump up investment for “IT, platforms [and] data solutions”, said Jon Dye, director of underwriting, motor at QBE European Operations.

Speaking at a panel discussion on the second day of the ABI’s annual motor conference, held remotely on 5 November, Dye noted that he is “seeing insurers feel their way into these changing environments and changing exposures” around the growing MaaS market.

According to MaaS Alliance, MaaS “is the integration of various forms of transport services into a single mobility service accessible on demand”.

This can include, for example, public transport, renting or leasing transport, car, bike or ride sharing, car clubs and even e-bikes or e-scooters.

Fellow panellist Stuart Sandell, assistant vice president for sales in UK and Ireland at Enterprise Rent-A-Car, added: “It’s really safe to say that pre-pandemic and post-pandemic, the way that consumers access mobility is definitely changing and is evolving through time.”

Underwriting for MaaS

Dye told online delegates that underwriting for MaaS is “evolving” amid product innovation, where new propositions are being created and existing products are being amended.

He described the pace of change in this market as “unprecedented”, adding that insurers need to learn alongside the MaaS industry’s key stakeholders as risk selection and pricing will differ compared to the traditional motor market.

“At a lot of it is around, firstly, understanding the attitude to risk and managing risk within these new mobility solutions and the approach that these companies will have, having clear and shared goals and working in partnership, working with stakeholders to create a sustainable customer product, customer proposition,” he said.

Practically, however, there is also infrastructure work to be done – Dye added that this needs insurer investment.

He explained: “It’s not without challenges, creating new products, so it does require investment from us as insurers.

”It’s not just about a new wording, it also includes things like investment in IT, platforms, data solutions, how do we price risk, how do we get the data, data being a critical element of what the future holds for us. It’s also about the downstream processes, including claims servicing.”

Market infancy

The benefits of embracing MaaS are multifaceted, however.

Dye said many insurers are looking to learn about and support this sector in order to influence road safety, as well as to stay relevant in changing times.

Plus, micro mobility options such as e-scooters are set to change the road safety dynamic, he added.

Panellist Peter Allchorne, partner at law firm and event sponsor DAC Beachcroft, agreed with this view.

He said: “Insurers are already supporting the development of these new mobility types and that’s really important in order that they can help make them turn from theory into reality.

”But this has to be only when it’s safe to do so. It’s really pleasing to see insurers united in what is really a safety-first approach here.”

However, Allchorne added that although MaaS is “a well-established concept” for the movement of freight, in terms of people “it’s really very much more in its infancy and early stages of development”.

He continued: “Ultimately, what we need to establish here is effectively an ecosystem which spans public and private transport.”

Legal challenges

Despite the market appetite for MaaS, there are still legal hurdles to overcome, added Allchorne. For example, e-scooters have yet to be legalised, so the potential insurance requirements are still guesswork.

Allchorne explained: “We know that e-scooters are going to be a key part of a multi-modal transport system and the government-sponsored trials that are going on at the moment are very much welcome.

“The idea of gathering an evidence-based approach must be the right one, but it still remains to be seen ultimately how far they will be legalised and indeed how they will be regulated.

”For instance, will they ultimately be regulated akin to mopeds or will [it] be more like e-bikes and that’s likely to impact where we see it going in relation to things like licensing and also, of course, insurance.”

However, Allchorne added that “regardless of where the government goes with e-scooters, there’s likely to be a market here for insurers to move into, regardless of whether insurance is made compulsory.

”This of course talks to the whole provision of flexible products that we see as part of the MaaS concept”.

This could include, for example, the introduction of personal mobility insurance, which provides cover across different modes of transport.

Accessibility

There is also the potential issue of “digital exclusion”, said Allchorne.

He explained: “[MaaS] has to be accessible by all and it’s very much a multi-layered digital platform that we’re looking at here and of course, they risk causing confusion for consumers.

”For instance, it’s important that a consumer can identify the correct defendant to any potential discrimination claim.

“Regulations must address also the risk of digital exclusion, so by ensuring accessibility standards, effective complaints procedures and also an alternative means of access for those who perhaps don’t have access to smartphones or internet access.”