Insurtech to expand underwriting footprint after Aviva and Prestige deal

Norwich-based insurtech Pikl will be expanding its underwriting footprint following its latest capacity partnership with Aviva and managing general agent (MGA) Prestige Underwriting.

The capacity deal aims to help Pikl achieve a greater volume of business and insure a wider selection of non-standard risks in its niche marketplace, which includes insuring Airbnb hosts, for example.

Louise Birritteri, chief executive and founder of Pikl, called the partnership a “dream team”.

She told Insurance Times: “The combination of us together is going to allow us to expand our underwriting footprint.

”In our UK business, we have products which deal with property damage and liability for those who are sharing their properties on Airbnb and similar platforms. It’s a complex market with interesting needs.”

As part of the expansion, Pikl is aiming to cover more special properties in the Airbnb area, with them accounting for 20% of the market.

”Prestige has knowledge of non-standard buildings, which are growing in the Airbnb market,” she said.

”Aviva has that home insurance background and we have specialist knowledge of the Airbnb and vacation rental markets.”

Problem

The partnership came after Pikl explored the attitudes of the UK’s major insurance providers towards the sharing economy.

Its study from March 2019, entitled Insurance in the sharing economy – 2019 property focus, was based on qualitative interviews representative of the UK’s largest insurers that managed 90% of gross written premium (GWP).

It showed that insurers said they would allow cover to remain active for around 30 days, but would impose exclusions on policies for short-term lets.

Over the last five years, Pikl has been working to solve this issue – for example, the insurtech introduced a customer question to help identify a short-term rental.

“We’ve built up a good amount of data and we’ve been able to demonstrate over the last five years that we can underwrite with the right level of caution,” she said.

However, she said capacity markets ”have been contracting over the last couple of years”, with it becoming ”increasingly hard for providers to get capacity”.

“The hard market has been hit by economic conditions,” she said.

”The home insurance market has been hit by [extreme] weather events, but also the increased cost of repairs post-Brexit. It’s a tough time.”