The Sharing Economy Opens New Opportunities for Insurers

Most of you have heard about the “Sharing Economy.” But what is it, really? And more importantly, what does it mean to you, the insurance agent? Simply stated, the Sharing Economy is a set of new solutions to old challenges that allows many companies to provide products and services in a manner that’s more efficient and in line with the way consumers live today.

Case in point – more and more people are using Uber®, Lyft®, Zipcar®, and Airbnb®. A big driver is that more of the economy is being propelled by people who are comfortable with owning less and operationalizing a digital purchasing experience to augment their lifestyle. And since most people have tiny, high-powered computers at their side at all times, a Brookings Institute study, predicts the sharing economy to grow by up to $335 billion by 2025*.

As these types of shared solutions become common place, other industries are taking notice. Especially insurance! With every new convenient app to share a car, property, or skill, new risks for consumers and in turn, their insurance providers, emerge. And that means there stands to be tremendous opportunity, too!

Sometimes that opportunity is already there. For example, a short-term rental endorsement that allows a rental property to accept rental terms as short as 7 days is ideal for Airbnb-type rentals. American Modern already has this in place to meet the changing needs of the

Sharing Economy. Think you don’t need it? Truth is, even if the owner purchases rental insurance coverage from the company making the connection with renters, the owner still needs a policy to cover damage that happens between rentals. This spells opportunity for agents!

Other times, you need to look for opportunities. For example, The Munich Re Group, is currently investing in a new innovation team that looks for new business product opportunities. One of these involves the exploding “shared mobility” field. Household names like Uber and Lyft focus on ridesharing, which brings together riders and drivers with a car. But a less known area is car-sharing, which connects drivers with a car they can rent. You’ll be happy to know that Munich Re is already working on the car-sharing model with start-ups. Another benefit of being an insurer that’s participating in the Sharing Economy is the new data it generates and the insights it will provide.

The biggest thing to keep in mind is that policy holders are not thinking about how adequate (or inadequate) their insurance coverage is for the new types of activities they are involved with. As an industry we need to educate our insureds about coverage gaps and work proactively towards policies or endorsements that bridge these gaps as participation in the Sharing Economy expands.

The more we learn about these trends the better we can react to them and be able to service our customers, creating loyalty and advocacy – something we all strive for.



Coverage is subject to policy terms, conditions, limitations, exclusions, underwriting review and approval, and may not be available for all risks or in all states. Rates and discounts vary, are determined by many factors and are subject to change. Policies are written by one of the licensed insurers of American Modern Insurance Group, Inc., including American Modern Home Insurance Company d/b/a in CA American Modern Insurance Company (Lic. No 2222-8).

Uber®, Lyft®, Zipcar®, and Airbnb® trademarks are property of their respective owners, and American Modern is not affiliated with, sponsored, or endorsed by them.

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Ryan Ward
Passionate about innovation and an avid user of the sharing economy. Love interacting with start-ups and figuring out how new product developments can relate, and benefit the insurance industry.
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