Pan-European e-bike insurance made easy

8 minutes to read
In a nutshell

Bike retailers have seen an uptick in sales thanks to the rise of the e-bike, which is altering the transportation landscape around the world. The current crisis will only accelerate this trend.

While bikes have traditionally been sold in stores, we're now seeing a rise in online bikes sales. Within three years, retailers expect that more than one-third of all bike sales will be made online, compared to roughly one-fifth today. This shows that having a blended sales strategy will become increasingly important.

Currently, most shoppers start their journey on one channel and complete it on another. Since these lines will start to blur over time, retailers must adapt and allow shoppers to complete their purchase – including adding insurance – however is most convenient for them. Creating and owning a powerful omni-channel approach will become the key to a bike retailer’s success.

At Qover, this is one of our unique advantages. As a digital insurance specialist that provides Pan-European coverage, we facilitate a seamless offline or omni-channel approach.

a man riding a Cowboy e-bike in a European city
E-bike buyers expect insurance, just like for a car.

Mobility shift fuels e-bike sales

Historically, bikes were almost exclusively purchased for leisure, sport or weekend activities. In recent years however, with rising traffic jams, packed public transportation and increased health awareness, there's been a huge rise in demand – especially for e-bikes. Many people now use their bike as a mode of transportation, and more specifically, on their daily commute.

Not only is it a healthier and more eco-friendly way to get around, but it provides a sense of freedom. This trend, along with increasing e-bike sales, means that the profile of bike customers has shifted. As buyers become part of a new mobility solution, they see e-bike insurance as a crucial component.

A quest for value-added services

Davy Louwers, CEO of Online Bike Group – based in the Netherlands, one of the world's most mature cycling markets – announced in spring 2019 that it would change the strategy of its primary brand to adapt to this new market reality and go all-in on e-bikes.

'It’s not enough to be the cheapest anymore – client-centricity is our main priority. 44% of our e-bike sales are commuters who are way more demanding. They want a good, fast bike with a great service offering. They choose an e-bike over a company car, so they expect replacement bikes, roadside assistance and flexible financing.'

Internetstores CEO Hans Dohrmann made a similar acknowledgement, 'The customer who is looking for a high quality e-bike to commute or the family who wants to buy an expensive cargo bike must be offered the service level that they expect according to the price.'

With the tremendous rise in e-bikes comes a rise in demand for insurance. Now that cycling has moved from recreational use to a functional mode of transport, the entire purpose of cycling has changed. And this is where insurance kicks in.

When regularly commuting by e-bike, many people are likely to leave it unattended in a city – which means they prefer to have it insured. Having theft and damage insurance, as well as emergency assistance, puts their minds at ease and means bike owners don't need to worry about leaving their costly e-bike parked on the street.

In the quest for value-added services, insurance is definitely one of the lowest-hanging fruits available to retailers. E-bikes require a significant investment from customers, and tend to be used on a daily basis. This makes theft a real nightmare scenario that buyers want to avoid.

Insurance as a new source of revenue

A Roland Berger survey in the Netherlands found that new bike sales account for 70% of a bike retailer's gross margin, whereas workshop fees account for 25%. Unfortunately, bike shops have limited diversification in terms of revenue sources. On top of that, the survey found that an average shop makes a profit of about 9% on capital, whereas 40% of shops were not profitable enough to pay shop owners an annual salary of €40,000. This means bike retailers need to be extremely creative and generate new sources of revenue that do not eat away at their margin.

Guarantees and free maintenance are popular incentives to sweeten the deal, but they have a real impact on cost structure and margin. Offering one year of free assistance, on the other hand, doesn't have this side effect and is a valuable offer to someone who's cycling to work every day. While there are thousands of cycling brands to choose from, few offer comprehensive bike insurance.

Qover is unique in that it that sells insurance both online and offline, helping retailers seamlessly transition between sales channels. Moreover, it enables retailers to initiate a sale offline and let a customer finish it online, or vice versa. Today, offering bike insurance is competitive advantage, but it will soon become a necessity. By offering insurance where the customer is, you create buyer delight, which leads to customer satisfaction and long-term customer retention.

You get the best of both worlds – but how? In the event of a stolen bike, for example, Qover’s bike insurance provides a voucher for a new bike from you. This means customers are more likely to return. What's more, we can help you sell insurance across different European countries, thanks to our simple API integration and technology which handles all of insurance's associated complexities.

InsurTech Qover's insurance value chain
Qover’s value chain shows how we handle complexities through a single provider across different geographical areas.

Foster customer loyalty

Loyalty goes hand-in-hand with customer retention. Yet according to Roland Berger's survey, bike retailers don't invest in loyalty, which has a huge impact on customer lifetime value. Generally, you have three options to grow your business' bottom line: increase the number of prospects, increase the number of transactions and/or increase the value of each transaction.

The latter is by far the easiest option. Not only do bike retailers earn a commission on every insurance contract sold, but because our bike theft insurance gives policyholders a voucher for a new bike, this doubles a bike shop's revenue and ensures they have repeat customers.

It's also important to ensure that the whole buying process is frictionless – otherwise customers could abandon their purchase and go elsewhere. In the online world, 34% of shoppers say that the possibility of a one-click checkout increases their loyalty to a retailer. That's why we've created an easy, one-step checkout experience when adding insurance for an e-bike. Once a customer adds a bike to their cart, they can add insurance – theft or theft and damage – in one click. They can see details about the coverage through quick links and info buttons, but adding bike insurance to their cart has never been easier.

In the event of an in-store purchase, customers can purchase insurance directly at the counter. Or they can purchase/activate it later on—at home, for example—via an online coupon or code. The bottom line is, whichever channel a customer chooses, they can finalise their insurance in the moment or on on their own time.

InsurTech Qover's open API allows for a single-click checkout process
Customers can add insurance to their cart thanks to one simple click.

Retailers need to be transparent

Unfortunately, retailers and shop owners are not insurance experts. The result is that some offer bike insurance that excludes theft at night or includes extreme depreciation of the bike of up to 15%, while some premiums only cover damages while including a high franchise.

This is clearly not the way to build sustainable customer relationships. Details about our coverage are clearly defined in layman's terms, which means there are less surprises for retailers and customers. But while the goal of offering insurance is to provide peace of mind, you also don't want to add friction to the sales process.

At Qover, we can integrate with third-party CRMs, provide mobile onboarding flows or integrate seamlessly with a simple, tick-the-box solution at checkout. All of this leads to a 60% conversion rate when purchasing insurance with a new bike.

E-bike brand Cowboy's digital insurance process shown on an iPhone
Cowboy proposes seamless insurance to its customers during checkout, with a conversion rate of more than 50%.

Flexible, one-click bike insurance is the solution

If executed well, insurance can be one of the most valuable tools for any bike retailer. On top of generating additional revenue, it increases customer loyalty and lifetime value while boosting the customer experience.

To maintain low costs and limit time to market, it's important to have a plug-and-play solution that can be integrated into any shop. An insurance provider that can navigate Pan-European coverage and roll-out will also give you the benefit of scale while decreasing the acquisition cost.

A good example is the insurance program we built for Cowboy, which is 100% integrated into the purchase flow of the bike as well as in their app. It includes no depreciation of the bike and no excess for damages above a certain amount.

At Qover, we're here to help make e-bike insurance easy and seamless. If your organisation focuses on customer experience and wants to provide real customer value, let’s connect. Check out more client case studies to see why we have a 95% customer satisfaction rate!


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