Insurtech Cuvva is looking to become a mainstream insurer and challenge the well-established motor insurance players, however, a lack of brand awareness could prove its biggest obstacle.
GlobalData’s 2020 UK Insurance Consumer Survey found that just 5% of respondents had heard of Cuvva. That figure wasn’t particularly low for insurtechs; only Marmalade (12%) registered over 10%, and Cuvva was more known than longer-established insurtechs such as Brolly and Honcho. But this finding does emphasise the scale of the brand challenge ahead if Cuvva is to become a mainstream player. Motor insurance is a key line due to the cost of premiums and value of insurance, which makes it harder for insurers to win consumer trust than in other smaller lines such as gadget or even travel.
One positive for Cuvva is that it is set to launch an innovative, value-driven policy that should both offer consumers a point of difference and fit the post-pandemic world. Cuvva will launch a flexible monthly subscription policy, enabling consumers to cancel at any time. Other insurers in the market provide flexible car insurance by the month (or even by the hour) – including Aviva, By Miles, and LV= – but this is still an emerging product. This type of flexible policy is likely to fit in well with consumers’ lifestyles, with many still working from home and thus less reliant on driving to work every day.
According to the same GlobalData survey, 69.4% of respondents anticipated that their annual mileage would decline as a result of COVID-19, while only 7% expected it to increase. This suggests the market for flexible insurance policies will have increased significantly. This could include pay-per-mile-type policies, which would help customers who drive less save money. But Cuvva’s flexible monthly subscription policy, with smaller payments and flexibility to cancel, will also stand out in the motor market and address changing consumer needs.