Embedded Insurance
The Insurance Guide: Everything you need to know about insurance.
Insurance can be quite complicated. But it doesn't have to be. From products of all types to integration options to the need for an insurance license. With this insurance guide, you'll get it all in one place.
Published 27 Jul 2023
Insurance Guide

What insurance products exist?

In theory, you can insure almost anything. But listing all the possible insurance products would clearly go way too far here. For this reason, we have focused on the areas that are most relevant to us:

1. Mobility

A road is a dangerous place. Well, sometimes it is. Shortly parked the bike and grabbed a coffee, but it suddenly disappeared. If you have bicycle insurance that includes theft, it's still annoying, of course, but you're not stuck with the costs. The additional offer of insurance is also worthwhile for leasing and sharing providers.

2. Electronics

We've all been there: just when we're excited about the latest smartphone, it accidentally lands on the floor a short time later, and we're pretty annoyed. This is where smartphone insurance makes perfect sense. Of course, the same also applies to any other type of electronics, such as tablets, laptops or cameras, because electronics are expensive.

3. Sports equipment

Let off steam and give it your all - without worrying that your beloved sports equipment might stop functioning. Or even yourself. Whether it's skis, a surfboard or sports accident insurance, insuring your sports equipment or yourself against accidents makes definitely sense.

4. Travel and activities

Especially since the pandemic, travel insurance has experienced a real boom. How could it not? Travel prices are rising, but people still don't want to miss out on travelling. And what if something happens to me abroad? We all know the answers to these risks: travel cancellation insurance, travel accident insurance, and travel health insurance.

5. Pets

Dog, cat, mouse. Well, maybe we'll stick to dogs and cats. The man's best friends should be taken care of so that high veterinary costs are covered in an emergency.

And what about me as a company?

The primary purpose of insurance products is, of course, to offer your customers the best possible protection. But insurance can also help companies relax and sleep better. The GDPR, for example, is causing some companies a major headache. Because breaches do happen - unknowingly. With a GDPR insurance policy, companies are protected against high costs.

What else? Many companies already use bicycles or e-bikes commercially. Whether it's a rental station, supplier, hotel or company bike user - a high level of use means more risks and damage. Commercial bicycle or e-bike insurance can save a lot of worries.

How do I integrate insurance into my offer?

As a company, there are many ways to offer insurance to its customers. However, all signs currently point to the concept of embedded insurance.

The term embedded insurance simply means that companies can integrate tailor-made insurance policies directly into their products or services - so to speak, "embed" them in their own existing offering.

Here's an example: a customer decides to buy the latest iPhone from a retailer's online store. Even before he completes the purchase, the customer is offered the matching smartphone insurance for his selected product. If the customer decides to purchase the product, the insurance policy is added to the shopping cart along with the iPhone, and the purchase is completed with a single click. In the background, all processes, such as sending the insurance documents, etc., run digitally and in real-time. The customer avoids hours of searching and comparing insurance policies and, above all, annoying paperwork - and, at the same time, the company offering the insurance.

Sounds quite interesting, doesn't it? See also our related blog post: How to take the headache out of Embedded Insurance.

Do I need an insurance license as a company?

In short: No, not necessarily. Or rather, it depends on whether you want to offer insurance in your own name. So you have two options:

1. Offering insurance WITH a license

If you want to offer insurance in your own name, you need an insurance license issued by the German Federal Financial Supervisory Authority (BaFin). The provisions contained in the Insurance Supervision Act (VAG) are crucial here. This specifies that every insurer is subject to supervision and must comply with all relevant regulations. It should come as no surprise that the requirements are high; after all, the insurance business requires a particularly high level of trust.

If you are also considering applying for such a license, you have to meet a large number of regulatory requirements. For example, new insurers must prove that they are fully funded at the time they apply for a license. BaFin primarily represents the interests of policyholders. For this reason, it places a primary focus on ensuring that a company has sufficient equity to be able to pay out in the event of a claim.

In addition to the financial requirements, you must of course also work your way through a huge number of regulations and get through some bureaucratic processes. This is followed by considerable investments in IT and the acquisition of the necessary know-how.

By the way: If you want to sell guarantees or warranty extensions to your customers, you also need an insurance license. The background is that since January 1, 2023, these services are considered insurance sales subject to insurance tax in Germany. If the necessary license is missing, it is therefore no longer possible to sell warranties and warranty extensions.

2. Offering insurance WITHOUT a license

So, we know: For companies, offering insurance with a license is difficult and quite complicated. But they can offer insurance to their customers without a license. What do companies need to know?

Let's jump back to the year 2022. Since a decision of the EuGH from 29.09.2022, any kind of companies or economic persons that offer insurance based on group insurance models and thereby themselves form the top of the group, are classified as insurance brokers. This means that as the so-called top of the group contract, those companies as brokers of insurance relationships must fulfil legal requirements. These include the obligation to provide information and documentation, and the provision of all information relevant to insurance law and documents (incl. GCI, IPID, insurance certificate, general terms and conditions, etc.).

Underwriters or insurance providers help such companies to meet these requirements and to continue to pursue the brokerage of insurance relationships as part of their business models and set them up in a legally secure manner. They make group insurance models available to their partners, fulfil the necessary legal requirements and provide the necessary infrastructure for this, right through to legally compliant document dispatch. Instead of taking insurance into their own hands, companies can offer insurance without a license and without having to meet legal requirements.

This is where the topic of embedded insurance comes into focus again. Companies should choose an embedded insurance provider right away to avoid long processes and annoying paperwork. And last but not least, to avoid falling behind the competition.

What is left to say?

As you can see, insurance doesn't have to be complicated. In fact, the insurance industry is in the process of revolutionizing itself. Embedded insurance is there rocking the insurance market. Why not join in rather than just sit back and watch? One thing is for sure: it will put the icing on the cake for your business.

Staying one step ahead of the competition.

Find out how it works with us and let us find out which solution suits you.

How can you increase your revenue?

Fill in the form to get your personal rate with hepster.

Field is mandatory
Field is mandatory
Field is mandatory
Field is mandatory
Field is mandatory
Field is mandatory
Field is mandatory
Thank you for submitting!
Form submission failed!