In the realm of digital transactions, challenges often surface, stemming from a variety of sources ranging from user errors to glitches within the payment systems themselves. The State of Online Payments report sheds light on the prevalence of these hurdles, revealing that a staggering 60% of respondents regularly grapple with issues concerning their monthly digital payments. The data also reveals the respondent’s ideal way to resolve payment issues.

Among the myriad obstacles cited, frequent occurrences include the forgetfulness of usernames and/or passwords, the absence of timely payment reminders, and frustrating delays in the processing of payments. These findings underscore the pressing need for streamlined, user-friendly solutions to mitigate these challenges and enhance the overall efficiency of online payment experiences.

In our quest to better understand how customers navigate these inevitable obstacles, we sought insights into their preferred avenues for resolving billing and payment-related problems. Through our survey, respondents were posed with the question: “What’s your preferred way to connect with customer service teams for billing and payment-related issues?” The results unveiled clear trends, with the top responses indicating a preference for direct communication channels.

How Do Customer Prefer to Resolve Payment Issues?

Specifically, survey respondents favored contacting the biller’s office via phone call, engaging in live chat interactions with customer service representatives, or opting to address the matter in-person at the biller’s physical location. These preferences shed light on the significance of accessible and efficient customer service solutions to address the daily concerns of digital payment users.

Customers facing these problems want them fixed quickly, so they can finish their payment and move on with their day. Naturally, they seek assistance from customer support teams to address their concerns, but this can exacerbate call volumes and even lead to heightened lobby traffic for billing organizations. This surge in inquiries is not only time-consuming, but can divert staff’s attention away from critical projects and potentially lead to employee burnout.

In order to avoid this, we’re highlighting several strategies billing organizations can implement to streamline issue resolution.

1. Leveraging Technology for Self-Service Options

The most impactful way to drive results for billers is to increase the volume of customers that are willing to self-serve, which they can do by enrolling in services like automatic payments (AutoPay), paperless billing, and even by signing up for payment reminders. Increased self-service means fewer customer service calls, reduced walk-in and lobby traffic, decreased staff workloads, fewer account shutoffs or cancellations — in short, increased self-service enrollment means fewer headaches for you and your team.

Offering an enhanced interactive voice response solution (IVR) is a simple way to provide that convenient, contactless customer experience your payers expect while also diverting customer service calls, improving operational efficiencies, and increasing your revenue flow. IVRs are ideal for providing 24/7 access to bill payment over the phone.

Online portals for digital payments are another great form of self-service. Allowing customers to pay when and how they want and on the device of their choice can not only decrease call volumes but can significantly increase customer satisfaction. Also, offering omni-channel options is crucial. Providing more options can lead to higher adoption rates — however, regardless of how many options you offer, the user experience should remain the same across all channels. Customers should have the same effortless experience making via phone that they have on the web, too.

Chatbots in EBPP, when used properly and in line with the law, can also help people pay their bills faster and with less hassle. Many common billing problems have simple solutions that chatbots, powered by AI, can explain easily. With the right keywords, chatbots can understand a biller’s problem, even if the biller isn’t sure themselves. In these cases, AI-powered chatbots can solve mundane problems quickly, saving time and resources so staff can focus on higher-value work.

Overall, these technologies can address common customer queries in a way that saves time for customer service teams and simplifies the process enough to eliminate typical issues, such as difficulty finding where to pay.

2. Implementing Effective Communication Strategies

Merely establishing communication channels with customers is insufficient. Understanding their preferences and payment history is crucial. Clear and accurate billing statements are essential to prevent issues and confusion.

Payment notifications play a pivotal role, identified as the second most significant problem by our survey respondents. Intelligent communications capitalize on existing customer information to deliver targeted reminders and notifications. For example, sending a payment reminder to someone who has already settled their bill is redundant. Likewise, a single email about an upcoming bill might not suffice to counter the “I forgot” excuse for late payments, especially if it’s lacking a link to payment, the amount due, or other details.

Employing various communication channels, such as email and SMS, based on customer preferences, is essential. Proactive communication, including FAQs and user guides, is also vital to preempt common inquiries.

3. Training and Empowering Customer Service Staff

Finally, investing in the training and empowerment of customer service staff yields multifaceted benefits. Well-trained teams not only possess the skills to efficiently address customer inquiries but also play a pivotal role in minimizing call volume through their adept problem-solving abilities. Moreover, empowering employees by granting them the autonomy to make decisions fosters a sense of ownership and accountability, directly influencing customer satisfaction levels.

When frontline staff feel empowered to resolve issues promptly and effectively, customers are more likely to receive satisfactory resolutions on the first contact, leading to a significant reduction in unnecessary calls and ultimately enhancing overall service quality.

Ready to learn more? For more insights into customer payment habits and billing preferences, download the most recent State of Online Payments report here.

Sponsored by ITL Partner: InvoiceCloud

Originally Posted By InvoiceCloud

Apple's ability to excite customers about technological change is legendary... but the company erred badly with a recent ad for its new iPad Pro. And if Apple can totally misjudge how people will react to change, then so can you and I. 

I worry, in particular, about how the insurance industry will manage all the changes that are becoming possible with generative AI and that will need to be rolled out throughout companies over the next many years. While executives sing its praises and talk about how much drudgery it can remove from jobs, how much more efficient it can make people and so on, I'm not sure they're fully factoring in the fears that many employees harbor and the organizational changes that will need to occur.

I have thoughts.

So we're all on the same page, here is a link to the Apple ad. And here is a link to an article about Apple's quick apology.

You can see what Apple was trying to do. It wanted to show that a whole array of creative tools — books, musical instruments, a record player, paint and much more — had been combined into a single, sleek iPad. Apple was even being its usual cheeky self by invoking a popular meme, in which people put cans of paint or fruit or just about anything into a metal crusher and then film and share what they look like when they explode.

What Apple somehow missed is that many of the items being crushed are totemic. People love their books, their pianos, their record players. People don't want to see those crushed, even in the name of sleek technological progress. You can't just sell the notion that a technology is cool and assume everyone will climb onboard.

Many people like their jobs, too — even the less efficient parts. They've done the job the same way for a long time, and they're in no hurry to change. Change takes effort and is disruptive mentally. 

A rule of thumb among venture capitalists is that a new product needs to be 10 times better than what a startup is trying to replace, or don't bother. That number doesn't need to be as high with employees because, after all, the employer is paying their salaries. But there still needs to be a clear advantage, or the employee will resist the change, and the employee has to be wooed, not just ordered around.

I've always been a bit of a curmudgeon about change management programs — banners and leaflets and rah-rah meetings aren't my thing — but I thought two senior consultants at Heidrick & Struggles whom I helped with a book eight years ago were quite perceptive on the topic, so I'll share some highlights here. (If you want to investigate further, these points all come from Chapter 11 in "Accelerating Performance.")

Colin Price and Sharon Toye, who have both moved on from Heidrick & Struggles, opened the chapter by emphasizing the need for speed. "When transformations don't work," they write, "the biggest reason is that bold new ideas weren't institutionalized rapidly enough." They then get to the five steps they recommend for an organization trying to make the sorts of changes that generative AI will allow... and demand:

"First, leaders need to connect with their people through a common and compelling purpose. Next, leaders must align the operating model of the organization to reinforce the behavior change. Third, capabilities must be built. There is no point in asking people to do things differently if they don't have the skills to do so. Fourth, the changes must be role-modeled by leaders. We all know that following the parental mantra of do as I say not as I do will ruin any chance of colleagues doing what senior leaders asked of them, although it is surprising how many senior players still try to get away with this manner of leading. Fifth, but by no means last is the need to provide space for people to explore the change being asked of them and to choose whether to adopt it."

While that last point is the one that surprised me the most and has stuck with me — that you need to give people space to come to terms with the desired change and to decide to either go along or to leave the organization — let's go through the five points in order:

—Common and compelling purpose:  Price and Toye write that successful change programs "communicate the why first." And it seems to me that there are lots of powerful whys in insurance for innovation, in general, and generative AI, in particular. Those whys include serving customers faster, more effectively and more humanely in their hour of need; helping them reduce the risks they face with their lives, homes, autos and other assets; and making the insurer more efficient, allowing for lower premiums and a narrowing of the production gap. 

Whatever the why, it needs to be compelling to the employee and needs to be consistent, because the next step is to communicate it relentlessly. Price and Toye write that "change agents typically under communicate their vision by at least a factor of 10." Peter Drucker, the legendary management consultant and author, once told me in an interview that General Electric's longtime CEO Jack Welch would pick one goal for the company and communicate it at every opportunity for five years. Then he'd pick a new goal and pound on that for five years.

Price and Toye said managers also need to allow time for dialogue with employees about what's changing to encourage co-creation rather than just defining and imposing change from on high. "Lasting change occurs through insight, not instruction," they write.

—Operating model: There may be structural changes needed. Changes in processes will certainly have to occur. And there will need to be metrics and rewards. 

That's pretty standard stuff, but care will certainly need to be taken on all three of those points. I can imagine metrics being especially tricky because some of the improvements allowed by generative AI are pretty squishy. 

—Capabilities: What they say here is also pretty standard: Make sure you have all the capabilities you need, match them to the right opportunities and either find or train people to fill gaps as quickly as possible.

I think insurers already do a pretty good job of matching a submission with the right underwriter and a claim with the right representative, but I imagine training will have to be different with generative AI. Training can't be one-and-done because the capabilities of the technology are improving so fast. Training will have to be continual.

—Role modeling: The authors stress the need for clear articulation of what you want your employees to do differently — "You can't expect your people to be mind readers." Then, they say, leaders have to model the new behavior. If you want your people to be gung-ho about generative AI, then you'd better let them see you using it personally. 

—Space: As I said, this is the bit of advice I found most surprising. Every company whose change programs I ever wrote about were clearly thinking of them as top-down, but Price and Toye note, "People have the freedom to choose to not engage, and they exercise that freedom only too often" because of fear of the unknown and the potential for loss. 

Their recommendation: "Change management, like training, has traditionally been seen as a push model and needs to become a pull model, where employees draw what they need rather than having it imposed on them.... If you enable them to experiment with what the change could look like, feel like and be like, then their level of comfort with a new reality is more likely to rise. And if you allow them to choose to change, then they are more likely to adopt change with greater conviction and energy than if you don't." 

What if people choose not to change? Then they've chosen to part ways with you, Price and Toye write, and you need to be disciplined about moving them out as quickly as possible. That may feel odd at a time when the insurance industry is focused on its talent gap, but they argue that you lose more by having lots of people who aren't invested in the changes you need to implement.

Price and Toye certainly weren't writing about generative AI. It didn't exist eight years ago. But I think their ideas are still worth keeping in mind as we implement that technology, in particular, and continue to innovate, in general. 

If even Apple can't count on getting people to jump to a cool new technology, what chance do the rest of us have?

Cheers,

Paul

The differentiator for independent insurance agents has always been the quality of the customer service they provide to their clients. Unfortunately, in today's challenging market, that focus on clients can fall to the wayside.

The standard of customer service varies from agency to agency and, in some cases, from agent to agent. Those making strides to improve their customers’ experiences are more successful than those who simply say: “This is how we’ve done it for 50 years; this is how my father did it,; and this is how we're going to continue do it.”

So what does superior customer service from insurance agents look like today? What trends have forced changes upon agents in terms of customer service, and what best practices can they follow to set up their agencies for success? 

See also: Customer Segmentation Is Key

External Factors Affecting Customer Service Norms 

Digital transformation 

Technology has transformed how agents and clients communicate. Younger insurance buyers have different expectations than prior generations. They expect self-service, for example, paying bills and filing claims online. Older generations, however, might eschew some claims automation tools while believing they understand the products available and do not need assistance.

These generational differences can create huge opportunities for agents to play more of a consultant role when it comes to advising clients on their risks as well as introducing more tailored insurance products. For example, agents can position themselves as educators, introducing and explaining new products and services, such as usage-based insurance. Some clients in a usage-based insurance model will resist having their vehicle report driver data while others will appreciate the ability to lower their premiums. As a result, agents have an opportunity to map out the pros and cons of the usage-based model and position themselves as valued advisers rather than simply selling. 

Agents must also recognize that the differing needs and preferences of insureds extend beyond product offerings and can even include how they want to communicate. Some want to be emailed, while others prefer a phone call and still others are more comfortable with text messaging. Although these forms of communication may feel less personal, they can actually be more engaging and help insureds to understand, in many cases, what they do not know they don’t know.

Artificial intelligence (AI)

AI is one of the latest and most important tools for customer service. AI can also intimidate some agents. We need to understand that AI does not have to replace agents. Rather, it should support and enhance the customer experience process and the agent/insured relationship. Agents should not fight AI; they should embrace it. Take advantage of chatbots, virtual assistants, self-service portals and mobile apps as much as possible. Agents can also work with their carrier partners and investigate what technology they have available. Not only will doing so help their client relationships, adopting these tools will make agents more competitive.

The reputation of the insurance industry

Relationship building remains paramount, so understanding your client base is critical. Insurance is a product clients know they need but do not want to purchase. It is a product used mostly when the client has a loss and needs to make their business or personal financial circumstances whole. In fact, clients do not even know whether the policy will work as intended until they file a claim and speak with their insurer. 

In part, this is why the insurance industry has earned a negative reputation through the years. It may be that agents did not ask enough questions of their clients during the buying process to understand the client’s needs and insure the property and its contents to value. Agents likely did not spend the time necessary getting to know their clients. In a situation like this, a claim can lead to an unfortunate experience for the policyholder. And in today’s litigious environment, unhappy clients are more likely to file a lawsuit.

See also: Customer Success Is Key, but Where to Start?

The Keys to Better Customer Service

Agents can overcome the industry’s reputation as well as challenges introduced by digital transformation and AI to achieve superior customer services by using the digital tools available and by spending more time understanding their client’s situation. Specifically, agents should confirm how the customer wants to interact with the agent, managing customer service from the beginning by asking the following questions: 

• How often does the client want to communicate with the agent?
• What renewal increase with the client accept before the agent decides to market the account to other carriers? 
• When does the client not want to hear from the agent?
•  How comfortable are they with certain technologies? 

If agents are not truly spending the time to understand the coverage issues their clients face as well as how they like to communicate, then agents may not be able to give their clients the best advice and customer service. 

Despite the direct-to-consumer trends prevalent in the marketplace, clients still want an insurance agent they can call who will understand them and provide personalized guidance. Technology must be part of the formula for superior customer service, but it can’t be the only component. Customer service, built on relationships and in-person as well as virtual interactions, will be key to the future of the independent agent.

In a not-so-distant future, where the boundary between humans and technological innovation blurs, imagine that you’re sweating through your daily workout at the local gym. It’s 7:30 a.m., you’ve been running for 30 minutes, weight lifting still ahead, and when you slow down to check the time, you get a notification on your phone: 

“Great workout! That’s four in a row! Your health premium has been marginally reduced to 
{insert number} …” 

Seems like a stretch? Maybe. But I’d argue that it’s not — and that it would be a good thing.

A key driver that has consistently shaped the U.K. market over the past three years is the integration of AI cloud data. Businesses across a variety of industries are exploring how AI can drastically enhance their offerings, and one sector that stands out prominently in this transformation is insurance.

While we navigate the rapid integration of AI into our lives, few of us grasp the degree to which it will interlace seamlessly with the intricacies of insurance. It’s not crazy to think that there will come a day — even soon — when insurance firms leverage AI to adjust the cost of premiums in real time, turning each commitment to a healthier lifestyle into a currency of lowered premiums.

The dawn of pay-as-you-live insurance

The integration of AI, coupled with the abundance of data from internet of things (IoT) devices and wearables, is already creating a dynamic and personalized insurance experience.

Looking forward, your insurance premium could soon easily be determined minute by minute based on data from your health tracker, smart home devices and even your car. This transformative emerging approach to insurance is rooted in the concept of pay-as-you-live, where individuals have incentives to adopt healthier and safer lifestyles.

In this scenario, your health tracker would communicate with your insurance company, verifying that you are engaging in physical activities. Consequently, your premium would decrease. Similarly, wearable tech in cars and smart homes combined with AI could contribute to a comprehensive understanding of your behaviors, creating a live feedback loop that could significantly affect your insurance costs. 

Here are a few more concrete examples that illustrate how AI could soon integrate into insurance:

See also: 5 Ways Generative AI Will Transform Claims

1. Driving behavior and telematics

In auto insurance, AI-driven telematics will soon play more of a pivotal role. Imagine a policyholder with a smart device installed in their car that monitors driving habits, including speed, adherence to traffic rules and even the choice of routes. While there are already apps out there from insurance companies that track how you drive for periods to ultimately adjust your premium or rate, with AI algorithms this would happen in real time. If a driver were to consistently demonstrate safe and responsible behavior, their insurance premium would be lowered. Conversely, poor driving habits could result in a higher premium. This approach would not only encourage safer driving but also establish a direct correlation between individual behavior and insurance costs (though I suspect most people won't be thrilled).

2. Smart homes and theft prevention

The integration of AI with smart home devices will likely also transform insurance into a guardian of property. For instance, if an individual's smart home security system detected unauthorized access or a potential break-in, the AI could instantly notify the insurance provider. In the event of a burglary despite the security measures, the insurance payout process could be expedited through AI-assisted claims processing. This live interaction between smart home devices and insurance systems would not only protect the insured property but also streamline the insurance experience.

What all this really boils down to is that integrating AI into insurance technology would allow for continuous risk assessment. As people go about their daily lives, algorithms would analyze data from wearables, smart devices and other sources to determine the level of risk associated with various activities. If someone is mitigating risks, perhaps by choosing safer routes or maintaining a secure home environment, the AI would adjust their insurance premium accordingly.

See also: Can AI Solve Underlying Data Problems?

Balancing “Big Brother” concerns with positive outcomes

While the idea of constant monitoring will undoubtedly raise concerns for some about privacy and a "Big Brother" presence, others might agree that the net societal benefits cannot be ignored. The data collected through AI tracking would enable insurers to identify accident hotspots, encouraging individuals to take safer routes and drive responsibly. This would not only enhance road safety but would also create a healthier and safer society.

Moreover, this data-driven approach extends to the concept of “vitality insurance,” wherein policyholders who are contributing to their well-being are rewarded with lower premiums. As health becomes a vital building block in determining insurance costs, people will surely be motivated to adopt healthier habits, creating a positive feedback loop that could benefit policyholders and keep them motivated toward a safer lifestyle.

Venue insurance is an essential safeguard in the complex world of event hosting, where uncertainties loom large. Yet many agents shy away from this particular specialization in favor of more straightforward, less specialized products where the risks and liabilities are more predictable and manageable.

Together with my wife, I own Appalachian Rose Farm, an all-inclusive wedding venue in Kentucky's scenic Red River Gorge. Couple that with my several years of experience in the insurance sector, and I understand the unique challenges this industry faces from the perspectives of both venue owner and insurance agent.

Drawing on my personal experiences, I hope this article encourages agents to pursue this specialization and arms them with the knowledge needed to help them confidently embrace the dynamic and potentially rewarding field of venue insurance.

Understanding the Unique Needs of Venue Owners

Venues, ranging from event halls and theaters to sports arenas and conference centers, come with a distinct set of risk factors. Owners of such properties must contend with physical risks like fire and structural damage, liability risks from accidents and injuries during events and business interruption risks that could temporarily halt operations. Recognizing the diverse challenges faced by different types of venues is the first step for insurance agents looking to specialize in this sector.

See also: How Sports Are Insured

Key Insurance Policies

Venue owners face a variety of risks due to the nature of their business, which typically involves hosting public events. These risks can have significant financial implications. To mitigate these risks, specific types of insurance policies are essential.

Venues are substantial investments, and damages from fire, natural disasters, vandalism or other causes can be costly to repair, so venues need property insurance to help ensure that the physical structure and contents are protected.

Given the public nature of events at venues, liability insurance is also crucial. This includes:

• General Liability Insurance: This protects the venue owner from financial loss due to injuries or property damage suffered by third parties within the property.
• Public Liability Insurance: Similar to general liability, this focuses on injuries or damages incurred by members of the public when they use the venue.
• Commercial Umbrella Insurance: This provides additional coverage beyond the limits of other liability policies, offering extra security in cases of particularly large claims.
• Event Cancellation Insurance: Events may need to be canceled or postponed due to unforeseen circumstances like extreme weather or key participants being unable to attend. Event cancellation insurance helps cover the loss of income and other non-refundable expenses, which can be significant, especially if the event was expected to generate substantial revenue.
• Business Interruption Insurance: If a venue must close temporarily due to damage from a covered loss, business interruption insurance compensates for the lost income during the closure. This is vital for maintaining cash flow and meeting continuing financial obligations such as payroll and loans.
• Workers' Compensation: This is a mandatory insurance in many places that covers medical costs and a portion of the wages for employees who get injured on the job. It also limits the liability of the employer in case of workplace injuries or illnesses, which is vitally important in an industry with significant physical labor and interaction.
• Fidelity Bonds (also known as Employee Dishonesty Insurance): Particularly significant for businesses where employees handle cash or valuable goods, this protects the venue from financial losses caused by fraudulent acts committed by employees, such as theft of money or property.
• Employment Practices Liability Insurance (EPLI): Common claims covered by EPLI are allegations of discrimination, wrongful termination, harassment and other employment-related issues. This provides protection from claims by those who believe their legal rights as employees were violated.
• Specialized Coverage/Weather Insurance: For venues hosting outdoor events, weather insurance is critical. It compensates the venue owner for losses due to adverse weather.

These insurance policies collectively address the broad spectrum of risks associated with venue ownership and operation, ensuring that venue owners are protected financially from a range of potential scenarios that could otherwise jeopardize their business.

Challenges in Insuring Venues

Insuring venues is fraught with challenges such as assessing and pricing risks accurately due to the unique nature of each venue. The need for customized policies that reflect the specific characteristics and needs of each venue is paramount. Moreover, the claims process can be complex, requiring careful management and fair resolution practices.

Best Practices for Agents

To effectively serve venue owners, insurance agents must embrace a set of best practices that go beyond the basics of policy selling. These practices not only enhance the agents' professionalism but ensure they provide the highest level of service to their clients.

Conducting a thorough risk assessments is the first step. Understand that each venue has its own set of risks and challenges, shaped by its location, type of events hosted and structural peculiarities. By thoroughly evaluating these factors, agents can identify potential liabilities and craft insurance solutions that are not just generic but meticulously tailored to mitigate specific vulnerabilities. This approach ensures that venue owners are not just buying insurance but are investing in a safety net customized to their particular needs.

Every agent knows the heart of insurance lies in relationship-building. Those who are successful make it a priority to forge genuine connections with venue owners. This is characterized by open communication and an earnest effort to understand the specific requirements and concerns of each venue. By asking the right questions and listening, agents can gain insights into the venue owner's vision and challenges, facilitating a partnership that extends beyond provider and client to allies in business success.

The landscape of venue management and the associated risks are not static; they evolve with changes in regulations, technological advancements and shifting market dynamics. An informed agent is an empowered agent. Staying abreast of industry trends and changes is key. Whether it's new fire safety regulations that affect venue compliance, advancements in event technology that introduce new risks or changes in public liability standards, knowledgeable agents can adjust policies to shield venue owners from emerging risks before they become problematic.

Insurance agents specializing in venue insurance should also look beyond their immediate industry. Networking with professionals like event planners, caterers and other service providers can give agents a broader perspective of the event industry landscape. These relationships are invaluable for understanding the full spectrum of activities and services associated with venues, which in turn enhances an agent's ability to advise on and service a comprehensive insurance plan. And such networking can lead to strategic partnerships that benefit all parties.

By integrating these practices into daily operations, agents not only elevate their service offerings but also position themselves as indispensable advisers in the venue insurance market. These practical steps also emphasize a philosophy of engagement, something I have found defines the most successful agents no matter the specialization.

See also: Risk Management Strategies for Agribusinesses

Enhancing Your Repertoire

Agents looking to specialize in venue insurance should consider pursuing targeted education and certifications that enhance their understanding of this niche market. Additionally, implementing targeted marketing strategies is crucial for attracting venue owners and showcasing the benefits of specialized insurance services. These strategies can help agents communicate the unique value they bring to the table while appealing directly to the needs and concerns of venue owners.

Navigating the complexities of venue insurance requires a specialized approach that addresses the unique risks associated with different types of venues. Through targeted education, comprehensive risk assessments and strategic marketing, insurance agents can not only meet the specific needs of venue owners but also distinguish themselves in a competitive market. By investing in building their own expertise and strong relationships with venue owners, agents can provide the necessary safeguards that ensure these businesses thrive despite the uncertainties they face. 

An agent's dedication to understanding and managing the complexities of venue insurance can result in long-term success for both the agent and their clients. This commitment helps to ensure the highest level of protection for the memorable events that venue owners work so hard to create.

The cannabis sector is poised for powerful growth as more U.S. states line up to green-light the popular plant.

According to Hub International's "What to Expect In 2024” cannabis outlook report, medical marijuana is now legal in 20 states and in the District of Columbia, while recreational cannabis is eligible for sale in 23 states along with D.C. Retail cannabis sales are expected to increase to $54 billion by 2027, Hub International reported.

Yet the buzz wears off somewhat given the business risks associated with growing and marketing cannabis in 2024.

“Losses related to catastrophic events such as fires, particularly those caused by a failure of High Intensity Discharge (HID) lighting systems used to grow crops, or theft of expensive cannabis products like cannabis oil, present further challenges to profitability,” the report noted. “And a rapidly spreading plant pathogen called HLVd could cost cannabis growers billions of dollars in coming years.”

See also: Is 2024 the Year of Digital Health?

Risk, Legislation and Lack of Industry Knowledge Vex Insurers

What do cannabis companies and industry insurers need to do to curb business risks and create insurance policies for all market participants?

“The current state of cannabis business insurance is quite restricted, with limited insurers willing to participate due to the high-risk perception and regulatory complexities,” says John Crist, founder of Prestizia Insurance.

Cannabis businesses, particularly cultivators and retail stores, often struggle with obtaining adequate coverage. That’s partly by design, as insurers weigh the risks of offering coverage in such a nascent marketplace.

“Best practices for these businesses include maintaining stringent compliance with state regulations and demonstrating a thorough risk management strategy,” Crist says. “For instance, a cannabis retail client in New York had to implement extensive security and inventory tracking systems to meet insurance requirements, underscoring the meticulous level of compliance needed.”

Another New York-related issue is that a New York state bill requiring medical cannabis to be covered by insurance plans could significantly affect the market, potentially leading to more widespread insurance adoption and possibly more insurers entering the market.

What other big issues are facing insurers contemplating initiating or expanding cannabis insurance coverage? Here’s a closer look:

Lack of sector knowledge

“One of the biggest challenges for new agents is the ability to learn and understand the business and marketplace,” says C.L. Mike Schmidt, an attorney with Schmidt & Clark, whose specialties include cannabis law. “The cannabis insurance sector is relatively small on the excess and surplus side, with well-known, established agents, brokers and underwriters. Therefore, selling oneself as a professional who understands the nuances is vital to breaking in.”

Need to know the “ins and outs” 

“It’s much more than your standard, typical excess and surplus (E&S) risk,” Schmidt says. “There are a lot of ins and outs that an agent should attempt to learn to be well-equipped to serve their clients. When it comes to underwriting the risk, agents must comprehend that most policies are written on proprietary endorsements, so knowing the ins and outs of each carrier’s form is critical.”

Under-the -radar risks

“The cannabis industry is a unique one to navigate in insurance as carriers must accommodate unique risks,” Schmidt says. “It shares common business risks with the consumer packaged goods market, overlaps with some pharmaceutical risks and has some wholly individual challenges like federal prohibition.”

“High-risk activities such as cultivation facilities housing thousands of dollars’ worth of products, transportation companies facing the open road while loaded with products and dispensaries moving large amounts of cash daily are not limited to a few smaller businesses — they spread across the industry,” he says. 

The “Schedule 1” issue 

“As of now, cannabis remains a Schedule I drug at the federal level in the U.S., which significantly impacts its legal status and the operational dynamics of businesses within the industry,” says Amber Benka, an agent at California Insurance Co. “The classification means it’s considered not accepted for medical use and has a potential for abuse, complicating banking, taxation and interstate commerce.”

The U.S. Food and Drug Administration (FDA) has recommended reclassifying cannabis as a Schedule III substance.

“This reclassification could potentially reshape the industry’s regulatory framework, impacting financial reporting and taxation,” Schmidt says. “However, this is still under consideration, and the final decision is made by the U.S. Drug Enforcement Administration (DEA).”

Local government policies 

The insurance marketplace remains active, but it may be difficult to obtain insurance within the limits required by leases or local governments.

“For example, some cities want dispensaries to have $2 million in general liability coverage, but carriers are only willing to offer $1 million,” says Chantel M. Roberts, a former claims adjuster who handled marijuana claims and fonder at CMR Consulting.

The departments of insurance (regulatory) have mandated insurers provide insurance if cannabis is legal in the state. But “the federal government, which controls banking, sees taking premium dollars as possible laundering of money-- so many insurers are still hesitant to enter into the marketplace,” Roberts says.

See also: New Workers' Comp Laws for 2024

The Takeaway on Cannabis Insurance Risk in 2024

Overall, the cannabis industry, while growing, faces significant operational and regulatory hurdles that directly affect insurance practices and availability.

“The development of more supportive legislation, like the New York medical cannabis bill, may encourage broader coverage and more insurers to enter the market, gradually normalizing business practices for cannabis companies,” Benka says.

Additionally, the introduction of legislation like the New York bill requiring medical cannabis to be covered by insurance plans is a significant step toward normalizing cannabis use in medical treatments and integrating it within the standard insurance frameworks.

“However, this also sets a new precedent that could complicate claims and underwriting processes due to the unique nature of cannabis-related liabilities,” Crist says. “As an insurance provider, we've had to recalibrate our offerings and reevaluate risk assessments to adapt to these emerging legislative changes, ensuring that both businesses and consumers are adequately protected under these new frameworks.” 

Samuel Green, CEO at Blue Insurance, says, “Things are slowly improving. More carriers are getting involved. But there's a long way to go.”

Hosting a podcast has been a fantastic way to meet people from around the world and help share their stories and advice. I’ve learned a lot. Running a successful podcast series requires commitment, but we are not the only show in town.

So as we hit the release of 300 episodes for the InsTech Talks podcast series, I’ve pushed the microphone to one side for a moment to reflect on nine other insurance-flavored podcasts you may want to sample, along with mine.

Be warned, this is rather a self-serving list – every one of these podcasts’ hosts has been generous enough to invite myself or one of my InsTech colleagues Robin Merttens or Henry Gale onto at least one episode. I’ve linked to that episode as your starting point. But we do have standards. This is not just a puff piece for us.  Each of these podcasts is worthy of following in their own right.

You should be able to find all of these on your preferred podcast channel, such as Apple or Spotify – or follow the links.

#1 InsTech Talk

Episode 287 January news: $73 million funding, ships, war and thunderstorms

Our very own podcast. We’re usually interviewing a founder or insurance leader, but we are now testing out a new format co-hosted with Nigel Walsh, global leader of Google Cloud. Each month, we’re breaking from our usual interview format to review the news items grabbing our attention in a rather more freeform style. For this episode here, we are joined by Martha Notaras (Brewer Lane Ventures) and Charlotte Halkett (Milliman) with a guest appearance by Amrit Santhirasenan (hyperexponential), who brings a glimmer of hope to all those depressed by recent insurtech funding rounds. If you like this, you’ll find the first news episode we did at 277 with Nigel,  James Birch (Brit Insurance) and Bijal Patel (Aurora). Next one coming soon, but in the meantime we’ve a fantastic back catalogue of CII accredited episodes to listen to.

#2 Voice of Insurance

Episode 151 – Parametric: where traditional insurers fear to tread

Mark Geoghegan draws on his experience and network from his days as a broker and journalist as he delves into the serious side of insurance. Many of Mark’s guests are leading figures from major brokers and insurers. Robin and I were honored to be in one of Mark’s earliest podcasts in the series. More recently, Henry Gale and I returned to talk about parametric insurance in 2022. Still a great primer for those wondering what parametric is all about.

#3 Making Risk Flow

Season 3 Episode 4 What everyone is talking about in insurance

Juan de Castro is COO and host for the Cytora podcast. This episode explores what major insurance companies and industry figures are doing to help underwriters spend more time at what they do best – underwriting. Juan previously worked at McKinsey and Hiscox, so he brings a practical and focused approach to his discussions. In this episode from February 2023, Juan and I discuss the current trends in insurtech. I returned again later that year to the Making Risk Flow podcast in October 2023 as host of the panel from our live InsTech event when we explored whether the future of underwriting had arrived.

#4 The Reinsurance Podcast

Episode 27 InsTech, Industry Challenges & Innovation

Robin Merttens was interviewed and filmed by the founders of Supercede and hosts of the Reinsurance Podcast, Jerad Leigh and Ben Rose. Both Jerad and Ben were brokers in prior lives, and the podcast is a successful side-hustle to their daytime job of building an insurtech company. As technology marches slowly forward, face-to-face relationships are essential in broking, and many parts of insurance. Settle down with InsTech’s chairman in the heart of London and find out what was on his mind that day.

#5 FNO: InsureTech

Episode 250: CEO of InsTech – Matthew Grant

Another popular podcast pair, Rob Beller and Lee Boyd bring some California and Texas sunshine to your day. With real jobs at U.S. claims administrator Alacrity, the podcast provides them with a way to talk to a wide reach of insurance folk well beyond claims. Usually operating remotely out of the U.S., for this episode Rob and Lee joined me in our InsTech recording studio in London during a recent trip. We discussed the origins of insurtech and talked about why Lloyd’s exists and why it’s so important to the U.S. market, particularly for the risks that insurers cannot or do not want to write. If you like your predictions for the year ahead, scroll back a few episodes to when Martha Notaras was their guest.

#6 Unstructured Unlocked

Episode 37 Christopher Wells, Indico Data, Michelle Gouveia, Sandbox Insurtech Ventures, and Henry Gale InsTech

Henry Gale stepped aside from his research and newsletter editing to talk to Indico data about generative AI. Henry runs our regular newsletter on that topic so he had plenty to talk about.  The insurance industry still has a big problem with extracting and using data efficiently, and Indico has dedicated an entire podcast series to support businesses looking to solve that problem. We’re delighted to be working with Indico Data, and Robin Merttens speaks to CEO Tom Wilde on our own InsTech podcast episode 292.

#7 The future of insurance Podcast

Season 1 Episode 19 Robin Merttens & Matthew Grant, InsTech London

Bryan Falchuk wrote the book on insurtech, literally. If podcasts are not your thing, then any one of these is worth a read. Bryan has worked as an insurtech founder, claims executive at a U.S. insurer and now is CEO of the Property & Liability Resource Bureau (PLRB). Step back in time three years ago to discover what we thought would happen in insurtech then – did we get it right? – or fast forward to today with a more recent episode as Bryan keeps up the pace with his thoughtful interviews from the U.S.

#8 The first 100

Episode 125 How founders acquired their first 100 customers, with Matthew Grant, a partner at Instech

Hadi Radwan takes time off each week from his day job building businesses to discover how other entrepreneurs found their first 100 clients. Hadi is a citizen of the world travelling between the U.S., Middle East and the U.K., and his guests reflect his global view and come from beyond insurance. We’ve had over 300 companies working with us at InsTech, and if you are wondering how we found them, join Radi and I to learn more.

#9 Corelogic conversations

Episode 84 Some Insurers Banned AI — Will Insurtech Bring It Back?

I was delighted to spend 30 minutes talking to one of my earliest employers, catastrophe modelling company EQECAT, now part of Corelogic, for this episode in February of this year. My former colleague, host of the company’s in-house podcast, Maiclaire Bolton Smith was intrigued about what is really going on in generative AI with insurers.

#10 RPC: Insurance Covered

August 2021 A look at embedded insurance (a podcast with Robin Merttens)

RPC is a law firm with a successful side line in writing articles and recording podcasts. Embedded insurance is one the topics we’ve been talking about for a few years now – and it’s one bright hope of insurtech that has stood the test of time well. This podcast was released alongside our report “To embed or not to embed?” Travel back in time to this episode to find out what Robin had learned and what he thought would come next.

That’s enough for now. Please let me know what you think about these or any of our episodes. We are always on the lookout for new guests for the InsTech podcasts, but due to demand we usually limit that to companies that are also members. You can find out how to become a member here, browse our full catalogue of podcasts or sign up to our newsletter so you don’t miss future episodes, events, reports and more.

Since the dawn of the smartphone brought convenience to our fingertips, delivering exceptional experiences to your customers has been all but required for companies to succeed. Now, to remain competitive in a constantly evolving, digital-first world, companies are investing in even more creative solutions to meet consumer expectations. The insurance industry, known for being complicated and often confusing, is undergoing a digital revolution of its own in the form of embedded insurance. 

Embedded offerings have been instrumental in the growth of the fintech industry over the past few years, offering ease of use to consumers and additional market opportunities to companies and giving organizations the ability to tailor products and services to individual industries. As embedded offerings continue to evolve and reach new customers, here are my top predictions for what to expect in 2024. 

Embedded insurance is poised for significant growth throughout 2024 and beyond

As traditional and digital insurers continue to make the insurance process more accessible and seamless, the importance and value of embedded insurance offerings and partnerships will continue to grow. In fact, the embedded insurance market was valued at $63.1 billion in 2022 and is expected to grow to over $480 billion by 2032. 

Embedded insurance offerings are nothing new. Travel insurance and services like Apple Care have been around for years. Digital insurance companies were born out of the need to simplify the insurance process for consumers and were designed to quickly adjust to the ever-changing insurance landscape, making them prime contenders to lead the charge into the new age of embedded insurance. 

The growth of the embedded insurance landscape will create a swell of new partnerships and VC investment, but only the strongest will provide long-term value and survive. Embedded insurance partnerships that are created “just because” will not last unless both parties and the consumer benefit from the solutions they offer. 

See also: Embedded Insurance Is Made for SMBs

Partnerships that receive buy in from both parties will survive long-term

In addition to satisfying customers' changing needs, the smooth incorporation of insurance into routine business operations creates opportunities for companies of all sizes. Challenges can always exist, but the advantages of improved customer experiences and a continuously growing market share are too great to pass up. Unlocking the full disruptive potential of these solutions will require a purposeful and cooperative strategy from organizations as they set out to embrace embedded insurance. 

For example, NEXT partners with some of the largest small business software providers in the U.S. to meet a range of small business needs, including purchasing insurance. NEXT's partnerships with Gusto, a payroll workflow platform, Intuit Quickbooks, a full-service accounting platform, and LegalZoom, a legal technology and services company, are all examples of how embedded insurance is providing more value to the small business ecosystem. By offering small business insurance directly through the platforms they are already using, insurers can help entrepreneurs address more of their business needs within a single, integrated platform. These embedded partnerships can continually integrate workflows and be easily updated for efficiency.

Although embedded insurance offerings have simplified the purchasing experience for the customer, some challenges need to be solved. Among these is the intricacy of integrating the current systems of both companies in a partnership. 

Digital insurers will have an advantage because they have the experience and expertise to create the infrastructure for embedded solutions that are not only simple to implement but have the ability to be quickly and easily updated. 

Organizations need to evaluate the traditional standards of financial soundness and underwriting and the technological capabilities of their potential partner, as well as any prior experience with successful embedded solutions. 

The partnerships that will ultimately withstand the test of time are those where both companies are committed to working together to maximize the power of digital offerings. This commitment includes continuous improvement to the servicing and purchasing experience, digitally powered underwriting for fast and accurately priced policies and seamless purchasing within existing user experiences and tailored policies. 

Unlocking the full disruptive potential of these solutions will require a purposeful and cooperative strategy from enterprises as they set out to embrace embedded insurance. 

See also: A New Approach to Embedded Insurance

Embedded insurance is here to stay—it’s not a fad. As consumers continue to expect companies to adapt to meet their ever-changing needs, partnerships that mutually benefit companies and consumers will increase in popularity and value. 

From personal lines of insurance like home and auto to commercial policies like business insurance, embedded solutions are a way of simplifying a traditionally frustrating and time-consuming process. As the number of embedded offerings increases, those that can adapt to the needs of the consumer and have high-level buy-in from all parties involved will break through the noise and not just survive, but thrive. 

Companies that are built in digitally native environments are set up well to claim their place in this embedded landscape, particularly in industries that are primed for disruption, such as restaurants and e-commerce. Embedded solutions help tackle pain points for consumers that have been entrenched for decades, and organizations that can solve these problems quickly and efficiently will lead the charge into the future.

The insurance community is well-versed in the industry’s modernization challenges of the past decade. More and more, we hear stories of carriers that have succeeded by acting fast, liberating themselves from the confines of outdated systems, paper and pencil and other manual processes. We’ve seen this across claims, underwriting, distribution and more. Many core insurance functions are well on the way to keeping pace with the modern consumer. 

Payment is next in line. 

Unfortunately, it is far from keeping pace with evolving consumer preference. According to a recent research study, 40% of insurers fail to provide the payment options that customers prefer. In many cases, insurers are ignoring the elephant in the room.

It is time for change.

Customers have a wide-ranging preference for payment choice.

There are a few major factors at play here: how consumers prefer to buy insurance, how they prefer to pay for it and how they prefer to receive disbursement--and those preferences change from household to household, from state to state and from country to country. Insurers must sell, collect and disburse to digitally native teens all the way through to older generations who grew up on cash and check. This means a combination of apps, calls, websites, direct mail, in-person and more. On top of that, varying degrees of speed and security required for each individual collection or disbursement, as well. 

This is fluid and evolving in real time. For example, a Duck Creek Technologies Global Consumer Insurance Insights Survey revealed that 52% of consumers felt that buying insurance through an app represented the most secure method, up from just 13% in 2022. That’s a big change. 

Within North American respondents, more than 50% said they are interested in insurance on-demand for short-term rentals. So, the digital movement is well upon us for a growing segment of insurance’s customer base.

See also: What Makes Insurance Invoicing Different

A diverse customer base demands diversity in payment and disbursement options.

Leveraging and connecting to payment services can be a stumbling block for insurers.

If insurers want to have skin in the game, it’s not enough to offer delightful selling experiences and making insurance easy to buy – it must be just as easy, secure and confidence-inspiring to pay or disburse, or customers face a nightmare. 

According to EY, Gen Z leads the way in adopting digital payment methods, preferring quick and easy payment experiences while being less concerned about data and privacy. Furthermore, insurance claim disbursement studies showed that more than 80% of consumers would like to work with organizations that offer quicker disbursement through push-to-card. And when it comes to customer satisfaction, more than 50% of claimants say missed expectations were the result of settlement payments taking longer than they thought they should have. 

That said, it would be a mistake to assume speed rules over all decision making. Because on the other end of the spectrum lie consumers who want a more reliable (whether perceived or true) way to pay or receive disbursement as opposed to in real time. One study found that consumers’ concerns include the fear of funds being deposited into the wrong account (34%), followed by the security of funds, lack of trust in certain payment service providers and the potential for high fees. The result? A third of customers state a preference to not pay extra for or choose the speed of real-time payments. 

Moral of the story: Customers expect (and rightly so) carriers to do it all.

Consumers want to be able to select their payment or disbursement option and have it delivered with speed while also ensuring the security of funds. As the world around us moves, insurers need to be nimble enough to follow where consumer preferences go. 

In today’s cloud-driven insurance technology ecosystem, they can, and they should.

Carriers DO NOT have to go at this alone.

Good news. This task doesn’t have to be daunting. Payment technology providers are entering the insurance space quickly. 

Connecting to payment services has historically been time-consuming and resource-intensive. This meant choice was often limited in favor of simplicity -- and insurers were not maximizing the potential the payments ecosystem had to offer. By leveraging cloud-based payments platforms, carriers will find a faster, simpler, more secure means to offer payment choice. 

Regardless of current IT infrastructure, carriers can quickly and easily connect to the banks, payment technology and payment service providers that their customer base, finance team or geographic compliance demands. Better yet, integrations can take place in minutes, not months.

If not for consumers, carriers should modernize payments for themselves.  

Insurers should also look internally to uncover the benefits of payments technology. In talking with carriers, we see the gaps in payment capabilities seeping into the operational side of the business, as well. Payment complexity trickles into finance, reporting and reconciliation efforts when data is ununified, when formats are unstandardized and when rules for different geographies are unaccounted for. Not only is this confusing, but it is time-consuming and risky, which often leads to financial leak, and the leak can be costly.  

Organizational drivers within insurance include regulation/compliance, operations, growth and innovation. When things get tight, cuts start. Every financial challenge or mismanaged fund or leaked dollar is opportunity lost to innovate for customers and grow the business. 

On top of the obvious loss of funds, plugging holes in payment workflows is expensive. Time lost for finance and IT teams, dollars lost for having to reissue or redo transactions, delays from not collecting on time... and the list goes on. As imperative as it is to meet consumers where they are, the benefits for carrier workflows are arguably even greater.

See also: Enhancing Claims Via Digital Payouts

Where do we end up? 

Carriers want simplified control, visibility and compliance. Consumers want choice, convenience and comfort. Can both sets of goals be met? Yes, and that’s why you’re seeing payment technology penetrate the insurance technology ecosystem. 

It’s time to address the elephant in the room.

Why do drivers switch to electric cars? For most electric vehicle (EV) buyers, it's about money. More specifically, drivers want to save on gas and take advantage of the four-figure tax credits they can claim. 

But some consumers may be overestimating their potential savings. According to one analysis, while insurance for EVs varies a lot by make, EVs still cost around 20% more to insure in 2024 than internal combustion engine (ICE) vehicles do.

While gas prices and federal policies are expected to push millions more drivers toward EV ownership over the next decade, EV enthusiasm has lagged in recent years. Here's how high insurance rates fit into the picture.

See also: We Need to Rethink the Future of Cars

Why are EVs so expensive to insure?

Insuring and managing claims is a fundamentally different process when it comes to electric vehicles versus ICE vehicles. As the EV market and infrastructure for electric vehicles evolves, EV and ICE premiums are likely to find more parity, but for now, expect these obstacles in 2024:

EV pricing

While EV price tags are dropping, electric vehicles still have higher sales prices in general than ICE vehicles, which makes them more expensive to replace after accidents and more costly to insure. Between September 2022 and September 2023, the average price paid for EVs fell from $65,000 to $50,683, but that was still higher than the average price for all new vehicles ($47,899). 

Repairs

EVs are more expensive to repair than ICE vehicles, for a handful of reasons. For starters, the replacement parts market hasn't kept pace with EV growth. There are also fewer repair shops and technicians qualified to work on EVs than on gas-powered cars. So parts cost around 25% more, and labor is more expensive, too. In 2023, EV repairs cost $1,322 more than ICE repairs on average. 

On top of that, EVs have a major battery problem. While the battery in an EV accounts for the majority of the vehicle's value, it's more vulnerable to damage than the battery in an ICE vehicle and more expensive and dangerous to repair. The job can require a specialist. 

EV battery issues are especially complex when it comes to Teslas, because some models have the battery parts glued together and sealed into the car, rendering them difficult to inspect and sometimes impossible to replace.

In 2023, the cost to replace an EV battery ran anywhere from $4,000 to $20,000, not including a labor bill that could be as high as $2,000. So even for an EV with minimal battery damage, a write-off could be more cost-effective. 

The self-driving myth

In late 2023, a LendingTree study found that Tesla drivers had a higher rate of accidents than drivers of any other vehicle brand. While the study didn't pinpoint an explanation, Tesla issued a recall around that same time for nearly every Tesla on the road. The reason? A problem with their autopilot systems was potentially causing crashes. 

Tesla CEO Elon Musk has arguably contributed to the brand's accident proneness. Since 2016, Musk has repeatedly implied that Teslas can drive themselves, and in 2022 some 42% of Tesla Autopilot users believed their vehicles were fully self-driving. Yet the National Highway Traffic Safety Administration (NHTSA) says there is "no vehicle currently available for sale that is fully automated or 'self-driving,'" and in March 2024, the Insurance Institute for Highway Safety (IIHS) gave Tesla's partial driving automation system a "poor" rating. 

Teslas account for more than half of all EVs sold, and Tesla's best seller, the Model Y, is one of the most expensive cars to insure.

Are EV insurance rates holding consumers back from buying EVs?

While the cost of buying EVs is a major deterrent to adoption, most consumers aren't specifically concerned about what they'll pay for insurance. 

In several consumer surveys, including surveys from AAA, Autolist and S&P Global Mobility, respondents have been asked to state their reasons for not wanting to buy an EV. The reasons given in each survey are nearly identical:

1. High purchase price 
2. Limited access to charging stations
3. Lack of confidence in the technology
4. Concerns about mileage range

Based on these results, it's not a stretch to assume that EV buyers don't get an idea of what their insurance will cost until after they're committed to a purchase. 

How to bring down the cost of insuring EVs

Considering how important price is to consumers, a reduction in EV insurance premiums can still be a good driver for new business. Here's how the insurers with the lowest EV premiums are bringing prices down:

Telematics and safe driving discounts

Unsafe driving is a problem for all vehicle types, but it's more likely to result in costly damage with EVs. 

In addition to, or in place of, traditional safe driving discounts, insurers can offer drivers the option to use telematic apps and plug-in devices that collect information about their driving — from hard braking to cell phone use and other hazards. Based on the data, a driver can qualify for a premium discount. For example:

• State Farm, which ValuePenguin found to have the lowest EV premiums on the market, offers safe driver discounts of 30% or more for customers who use their Drive Safe & Save Bluetooth-paired app.
• Tesla's Safety Score (Beta) gives drivers a score from 0 to 100 based on driving behaviors, and the driver's premium can change monthly based on the score. If your average score increases from between 95 and 99 up to 100, you can save over $1,000 per year.

See also: Challenges Facing Tesla Insurance

Bundling incentives

Another way to help EV-drivers reduce their premiums is through bundling discounts, available for customers who buy multiple products or purchase coverage for more than one car. American Family Insurance, another insurer that offers competitive premiums for EVs, gives customers a discount up to 23% for bundling home and auto coverage.

For a more indirect tack, you can also educate customers about the trade-offs involved with EV ownership. While their insurance premiums may be higher after buying an EV, gas savings and potential tax credits can make electric vehicles cheaper to own than similar gas-powered cars, even with insurance prices included.