Interview with Danuta Żukowska, General Manager CEE: Digital Insurance is Not a Yeti!

Cachet has been in the Polish market for two and a half years now. How would you summarize this period? What has been achieved, and what lies ahead?

We entered the Polish market with our flagship product – insurance for users of digital platforms, such as Uber, Bolt, iTaxi, and FreeNow. We are talking about drivers using various taxi applications. This was our first innovation. The past year has been the most dynamic in our history. The company has expanded, and we have broadened our product offering. For example, we introduced insurance for bicycles and scooters, which quickly gained recognition among two-wheel enthusiasts. We also extended our offerings to business customers operating in this sector, primarily owners of large micro-mobility fleets.

Is a mobile application your only distribution channel?

We strongly believe that insurance can be effectively offered in digital form, through applications and the internet. However, this does not exclude our involvement in various distribution partnerships. We enthusiastically engage in marketing and sales cooperation with companies in the micro-mobility sector. This year alone, we have formed nine such partnerships, with more on the horizon. In the Polish market, we have a multi-agent status, allowing us to collaborate with insurance companies. Two years ago, we started working with PZU, and in the last year, companies such as ERGO Hestia, InterRisk, Allianz, Warta, and Generali joined our partner network.

What challenges have you faced during your operations? What lessons have you learned from them?

Challenges abound! Currently, there is a slowdown in the application market, but it affects insurers more than intermediaries. It greatly helps us that in the last funding round, we were well-capitalized. This gives us the comfort to develop our offerings, team, and invest in the growth activities. We are entering this market sensibly. We have very high ambitions. We consistently expand in the niche we have chosen, namely the market of users of digital platforms. We are also a company offering software, extracting data from digital platforms through APIs, and analyzing them using modern technologies and our analysts. This data is the basis for creating interesting solutions both in the insurance offering itself and in various additional services related to insurance.

In Poland, vehicle insurance is linked to its owner, not the user. However, you insure users.

The shift from ownership towards usage and the broadly understood “sharing” of vehicles – from cars to bicycles and scooters – is a key trend in the field of mobility. Traditional insurance has not adequately responded to these changes yet. Uber drivers are often directly or indirectly excluded from the possibility of using insurance. In theory, they can obtain insurance because mandatory third-party liability insurance is a requirement, but it can be up to five times more expensive compared to the standard offering for the average driver. This is because traditional insurers treat the taxi driver group uniformly. In this context, Cachet emerges with an offer of personalized insurance based on data. These data are more dynamic, relating to the individual habits and routes of a specific driver. This allows us to propose insurance tailored to the specific user. This does not mean that our premium is always lower. It is more favorable for those drivers who drive responsibly and safely.

There seems to be some fear of telematics in the market, but if applied on a large scale, it can help reduce claims, improving not only insurers’ savings but also road safety.

Prevention is one of the long-term goals we set for ourselves. Our application also serves as a communicator, assessing the driver’s driving style. We use various scorings and profiling: for example, we determine whether the user is a weekend driver or maintains a balance between work and private life by analyzing the number of hours spent behind the wheel. In the longer term, we want the application to signal to drivers that certain behaviors on the road may increase risk. We plan to introduce messages suggesting corrections to driving style or a reduction in the number of hours spent daily behind the wheel. The tools we have will allow us to develop innovative preventive programs in the future.

What are your priorities for the coming months? Where do you see areas for growth in these challenging times?

We place a strong emphasis on distribution relationships and plan to expand their scope. Visibility of the offer in the market is a priority for us. We also aspire to deeper integration of insurance, not limiting ourselves to affiliate cooperation directing customers to our application but also by embedding our insurance proposals directly into the purchasing process with partners. We are already implementing several advanced initiatives in this area, and this year we will initiate the first such project with one of the key players. We also have larger strategic alliances on the horizon, which may seem unconventional to the market but are entirely logical for us. We aim to increase our distribution power and the diversity of our offering.  For example, we intend to launch third-party liability and personal accident insurance for micro-mobility users later this year. We are convinced that embedded insurance will find its place. We are in dialogue with various companies because our goal is to be present where customers make daily purchases, offering them the opportunity to insure purchased products and services.

Original article published in Gazeta Ubezpieczeniowa on 13.11.2023.