How trust can help reduce your insurance costs

Do you think you’re a good driver? Would your family and friends be prepared to stake their money on it? VouchForMe think so, in fact, they’re banking on digitalising the trust between friends and turning it into something valuable. VouchForMe is the 'Insuretech' startup behind a disruptive blockchain-based technology app that lets people leverage their personal connections in order to reduce their car insurance excess. Their concept is set to challenge a market that’s crying out for innovation and a more human approach.

The car insurance industry has gone through plenty of changes in the UK over the past few years. We’ve seen the introduction of driver apps that are designed to monitor whether or not you’re driving safely. We’ve also seen the growth of personal finance websites such as Moneysupermarket and Go Compare, that consolidate driver data and offer insurance packages based on what you tell them. Harnessing social capital in the digital age isn’t exactly a brand-new idea, think of how influencers are monetising Instagram, Twitter or blogs. However, digitalising and creating value from trust is a new concept. Think peer-to-peer lending vs approaching a large bank for a loan. Enter VouchForMe’s new platform app that connects people, encourages a more human approach and seeks to reduce driver excess by using trust to underwrite risk.

Lučka Čokl Preis, CMO of VouchForMe explains “We knew that VouchForMe’s blockchain product and social proof-based concepts were right for the UK market. The idea got a lot of traction with the blockchain and business community as well. But when we started designing and creating our go-to-market strategy we realised we needed to test our assumptions from the stand-point of UK consumers. Is our value proposition clear? Are we really aiming at the right audience? We were seeking a local UK research partner that would support us to find out what we needed to know.  Further were a perfect fit.”

VouchForMe wanted to understand the UK insurance market from a cultural perspective, testing concepts as well as getting to grips with the problems and potential solutions that its product could address. For example, it’s well documented that young people often find themselves in a position where car insurance premiums become unaffordable, even unattainable. Would a friend or relative be prepared to underwrite their driving with trust, in order to reduce premiums? Using our Together platform, we unearthed attitudes towards the proposition that enabled VouchForMe to decide how they’d need to tailor their product and services to the UK market.

Dr Marie-Claude Gervais, Director of Research at Further, explains “We spent a week online, working with people of driving age who were from a range of backgrounds. We wanted to understand the subtle and complex attitudes they have towards trust, money and social relationships. How far do they trust people? With how much money, and under what circumstances? And for what purposes? What do they think about harnessing trust between friends and family to reduce the cost of insurance premiums? We found that the concept of using social connections to reduce the cost of insurance is extremely popular, especially for younger people. But the digitalisation of trust between relatives appeals much more than between friends, because there are deep-rooted attitudes against mixing money with friendship. We identified where demand is highest and advised on how to take the proposition to market in the most effective way. The findings will help VouchForMe refine their proposition, hone their key messages and use the evidence to establish partnerships with key insurance carriers. The challenge for them will be to target two very different audiences, those who vouch, the parents, and those who are vouched for, the children.”

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