How Do You Insure A Doohicky? (A Guide To Niche Insurance)
25 Sep 2017
As a broker you will already be familiar with some of the more ‘traditional’ niche products such as cyber, overland flooding and drones. However as technology and risk areas develop, your clients may not appreciate that coverage can be written for some of their more obscure assets. It is your job to introduce these odd policies to consumers who might want to protect something that they think is too outrageous for insurers to cover. You’ve heard of celebrities spending millions to insure certain body parts as a precautionary move to protect their resources. Whether it’s their tongue, legs, rear-end or even a moustache, a bodily injury or a minor scratch could result in a significant loss of earnings. These are the peculiar areas in the market where the insurance industry is expanding: niche.
Brokers, there is good news – it is possible to insure obscure things such as classic cars, food trucks and ride sharing.
Experts have stated that due to the industry’s technological investments there is an increase in the number of opportunities for insurers to specialize. New technology brings new requirements, therefore encouraging brokers to find a market and sell products for unique risks. This phenomenon gave birth to the likes of marine brokerages that are known to be the masters of boat insurance. But what about the other emerging non-traditional risks of the modern world?
• Airbnb: The boom of travelling has seen the rise of short term rentals. It’s as easy as booking an hotel room but with the convenience of having more independence. However, it can be a gamble for property owners and landlords to let strangers use their abode as their own. Traditional homeowners’ and renters’ insurance can be limited to protecting personal belongings. However damage caused by guests or loss of their personal property are not covered by traditional home insurance policies. This is why properties rented out under Airbnb can be more problematic if guests wreak havoc in the property or if they sue the owners if they suffer an injury at the accomodation. Deposits may not adequately cover all of the damage caused, especially if the damages affect neighbouring properties. There are a lot of risk areas to consider. However underwriters have identified a gap in the market and created policies that cater for Airbnb host-clients. They cover all aspects of a guest’s stay such as property damage, loss or damage to personal possessions, third party damage and injuries sustained on the premises.
• Pest Managers: Whenever a client has had to face elusive critters causing wreckage to their property that they were unable to eradicate themselves, they probably had to call in pest control. They are the modern superheroes protecting us from infestations, however they don’t necessarily have the same protection as other contractors that they need when performing their job. The reason being they use certain chemicals to kill bugs that may cause harm to humans and to the surrounding properties as well. Pest controllers may succeed in treating the problem, but it can have an adverse effect to the building, such as damage to paint work, carpets, upholsteries, etc. These can be situations beyond their control as solving one problem can create another. Professional indemnity products targeted specifically for pest managers can be a great backup plan for when problems escalate.
• Tattoos and Body Piercings: There’s no shortage of horror stories about tattoos and body piercings. For example, a couple of years ago a tourist got inked while on vacation in Indonesia. But it turned out his body art came along with a price, an HIV infection. Despite such gruesome cases, many people still have a fondness for body decoration. To enhance her appearance, one woman tattooed her eyeballs with a pale blue colour, had several piercings across her face and spliced her tongue. All of these procedures involve inserting needles deep into the skin, possibly contaminated and resulting in a serious infection such as Hepatitis. Customers could sue the tattoo artists and their business, potentially resulting in the business closing as a result of the claims and potential damages paid out. A customized public and professional liability product made specifically for these kinds of risk provides financial protection if the services rendered are met with complications.
• Aquaculture: Have you ever heard of a coverage catered for the shell-farming industry? Apparently, it’s one of the fastest growing industries in the country as more people crave seafood on their plates. Think of oysters, mussels, prawns and crabs. They may seem delicious at first but not when these freshwater organisms cause illness due to poor storage, handling or preparation. When diners choose to hold the seafood provider liable, a general liability policy may not come in handy. Brokers may turn to the age-old product liability policies that have saturated the market. But your clients will appreciate a more bespoke policy specifically created for their line of business that covers risks such as pollution, sabotage or a loss of earnings.
These are just a few of the examples that illustrate how insurance isn’t just about protecting consumers from traditional risks such as loss or damage under policies that are already widely available. There are many unique and specialist areas emerging all of the time that remain largely uncovered, making the specialty insurance market more interesting and exciting.
Due to the increasing and ever changing demand of consumers, brokers may have a hard time keeping up with what products are available, as well as emerging trends in the market. This is why Insurr is such a valuable tool in keeping brokers up to date with what’s hot in the industry. With an easy to use search engine and emails to subscribers revealing top 10 broker searches and new product highlights, Insurr is an innovative and relevant online tool that is essential to specialty insurance brokers.
If you haven't signed up for your unlimited free access yet you can do so here.
Other pages of interest:
Tech, acquisitions, and other trends in insurance by Insurance Business on March 9, 2017
'Days are numbered' for traditional brokers by Insurance Business on February 28, 2017
Targeting Niche Insurance Products by Stan Ivankovic on July 13, 2017
Brokers, there is good news – it is possible to insure obscure things such as classic cars, food trucks and ride sharing.
Experts have stated that due to the industry’s technological investments there is an increase in the number of opportunities for insurers to specialize. New technology brings new requirements, therefore encouraging brokers to find a market and sell products for unique risks. This phenomenon gave birth to the likes of marine brokerages that are known to be the masters of boat insurance. But what about the other emerging non-traditional risks of the modern world?
• Airbnb: The boom of travelling has seen the rise of short term rentals. It’s as easy as booking an hotel room but with the convenience of having more independence. However, it can be a gamble for property owners and landlords to let strangers use their abode as their own. Traditional homeowners’ and renters’ insurance can be limited to protecting personal belongings. However damage caused by guests or loss of their personal property are not covered by traditional home insurance policies. This is why properties rented out under Airbnb can be more problematic if guests wreak havoc in the property or if they sue the owners if they suffer an injury at the accomodation. Deposits may not adequately cover all of the damage caused, especially if the damages affect neighbouring properties. There are a lot of risk areas to consider. However underwriters have identified a gap in the market and created policies that cater for Airbnb host-clients. They cover all aspects of a guest’s stay such as property damage, loss or damage to personal possessions, third party damage and injuries sustained on the premises.
• Pest Managers: Whenever a client has had to face elusive critters causing wreckage to their property that they were unable to eradicate themselves, they probably had to call in pest control. They are the modern superheroes protecting us from infestations, however they don’t necessarily have the same protection as other contractors that they need when performing their job. The reason being they use certain chemicals to kill bugs that may cause harm to humans and to the surrounding properties as well. Pest controllers may succeed in treating the problem, but it can have an adverse effect to the building, such as damage to paint work, carpets, upholsteries, etc. These can be situations beyond their control as solving one problem can create another. Professional indemnity products targeted specifically for pest managers can be a great backup plan for when problems escalate.
• Tattoos and Body Piercings: There’s no shortage of horror stories about tattoos and body piercings. For example, a couple of years ago a tourist got inked while on vacation in Indonesia. But it turned out his body art came along with a price, an HIV infection. Despite such gruesome cases, many people still have a fondness for body decoration. To enhance her appearance, one woman tattooed her eyeballs with a pale blue colour, had several piercings across her face and spliced her tongue. All of these procedures involve inserting needles deep into the skin, possibly contaminated and resulting in a serious infection such as Hepatitis. Customers could sue the tattoo artists and their business, potentially resulting in the business closing as a result of the claims and potential damages paid out. A customized public and professional liability product made specifically for these kinds of risk provides financial protection if the services rendered are met with complications.
• Aquaculture: Have you ever heard of a coverage catered for the shell-farming industry? Apparently, it’s one of the fastest growing industries in the country as more people crave seafood on their plates. Think of oysters, mussels, prawns and crabs. They may seem delicious at first but not when these freshwater organisms cause illness due to poor storage, handling or preparation. When diners choose to hold the seafood provider liable, a general liability policy may not come in handy. Brokers may turn to the age-old product liability policies that have saturated the market. But your clients will appreciate a more bespoke policy specifically created for their line of business that covers risks such as pollution, sabotage or a loss of earnings.
These are just a few of the examples that illustrate how insurance isn’t just about protecting consumers from traditional risks such as loss or damage under policies that are already widely available. There are many unique and specialist areas emerging all of the time that remain largely uncovered, making the specialty insurance market more interesting and exciting.
Due to the increasing and ever changing demand of consumers, brokers may have a hard time keeping up with what products are available, as well as emerging trends in the market. This is why Insurr is such a valuable tool in keeping brokers up to date with what’s hot in the industry. With an easy to use search engine and emails to subscribers revealing top 10 broker searches and new product highlights, Insurr is an innovative and relevant online tool that is essential to specialty insurance brokers.
If you haven't signed up for your unlimited free access yet you can do so here.
Other pages of interest:
Tech, acquisitions, and other trends in insurance by Insurance Business on March 9, 2017
'Days are numbered' for traditional brokers by Insurance Business on February 28, 2017
Targeting Niche Insurance Products by Stan Ivankovic on July 13, 2017