Trust, But Verify


When I first met Dan Ariely (now chief behavioral officer at Lemonade, among his many other duties) 15-plus years ago, he told a story about how people will, well, cheat on their insurance applications. He said he got a large car insurer to let him experiment with 12,000 applications. For the control group of 6,000, he changed nothing. They filled out the form, including how many miles they drove each year, and signed at the bottom. With the other 6,000, he had people sign at the top, attesting at the beginning of the process that everything they were about to fill in would be true. Dan drily reported that, "It turns out that those who sign at the top of the form drive 3,000 miles a year more than those who sign at the bottom."

Since getting involved in the insurance industry 3 1/2 years ago, as part of my three-decade focus on digital technology and its prospects for innovation, I've learned that lots of people fudge, and not just on how many miles they drive. People will find a homeowners policy a bit too expensive, so they'll fiddle with the facts and report that the home had the roof replaced recently or forget to report that trampoline, or something. What really surprised me is how much people get away with fudging (I'm trying to be kind here) on whether they even have insurance. They'll get a certificate of insurance, so they can show that a policy was in force at a particular moment in time, but then what? How do you know that policy is in force a day later? A week? A month? Six months?

With the advent of Trov, Slice and a few other innovators, it's now possible to turn coverage on and off (for some things) in an instant, but businesses still don't really know whether those they're working with have the requisite insurance at any particular moment. And if they want to find out, businesses have to wade through a sea of paper (or sometimes PDFs) that must total in the tens of millions each year in the U.S. alone.

Well, I'm happy to report that as part of our work at the Innovator's Edge site, which tracks the roughly 800 insurtech startups, we've come across a company that has a solution. That company is GAPro, and you can learn more about it here. In an era where software-as-a-service has become commonplace, GAPro provides what it calls verification-as-a-service. You get a dashboard that tells you in real time the coverage status of your contractors, brokers or whomever -- green signifying that all is in order, yellow highlighting those whose policies are up for renewal soon and red showing those whose policies have lapsed. 

GAPro is still in its early days -- that's what insurtech is all about, right? -- but the idea is spot on, and those running the company are seasoned pros, so I'm confident they're going to get this right. That's why we've begun working with them to provide some counsel and, of course, to help them get the word out. You can read the announcement about our new relationship here. If you have a problem managing certificates of insurance -- and who doesn't? -- I encourage you to contact them. 


Paul Carroll,

Paul Carroll

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Paul Carroll

Paul Carroll is the editor-in-chief of Insurance Thought Leadership.

He is also co-author of A Brief History of a Perfect Future: Inventing the Future We Can Proudly Leave Our Kids by 2050 and Billion Dollar Lessons: What You Can Learn From the Most Inexcusable Business Failures of the Last 25 Years and the author of a best-seller on IBM, published in 1993.

Carroll spent 17 years at the Wall Street Journal as an editor and reporter; he was nominated twice for the Pulitzer Prize. He later was a finalist for a National Magazine Award.