Which Coverages Should You Offer?

Embedded insurance is expanding quickly and creates a great opportunity for businesses looking to grow their revenue. But if insurance is not your business’s core focus, it’s not always obvious what kind of insurance offer is the right fit for your business. In this blog, we’ll explain what to consider when getting started offering embedded insurance, and how to determine what’s right for your business.

Insurance Product vs. Insurance Coverage

There are two layers to consider when it comes to offering insurance: product type and coverage. The insurance product is the type of insurance that you’ll offer to your customers. For example, pet health insurance, renters insurance, management liability insurance, and cyber insurance are all types of insurance products.

Of course, not all products are the same - two different pet health insurance products might provide very different levels of protection. This brings us to the second layer: insurance coverage.

Coverages describe what risks and/or benefits are covered by an insurance policy. Under the umbrella of a product like renters insurance, things like third-party liability, theft, and earthquake protection are coverages. Another common insurance term that you might hear is “endorsement.” This is the official name for optional coverages that add protection to a policy.

What Insurance Product Should Your Business Offer?

Embedded insurance represents a significant opportunity for businesses to build revenue, and increase their customer engagement and LTV. A big reason why is that it reaches customers when they’re already making a related transaction, and are most likely to be interested in adding insurance. To make embedded insurance work for your business, you don’t just need to offer an insurance product - you need to offer one that makes sense for your customers to buy when they’re already making a purchase from you.