Gig economy: intimately connected with insurance

5 minutes to read
In a nutshell

Increasingly, workers flock towards the gig economy, from the food delivery rider to the freelancer consultant. This has had a profound impact on our concept of work and what it means for the labor force. Employers in the gig economy space need to think about how they can meet those needs. By the very nature of the gig economy, this means getting intimate with insurance.

Popularity of platform economy

The rise of the gig economy is one of the most dramatic shifts in the labor market in recent years. People participate in it not just to earn a living but to organize their lives. Three in four American gig workers say being an independent worker provides them with the flexibility they need to manage both work and life, a finding that is also supported by the largest ever rider survey in the UK by our partner Deliveroo.

Self-employed workers worldwide are substantially more satisfied than traditional employees. The most important drivers of this difference are the increased autonomy independent workers enjoy and the fact that they tend to find the work they do more interesting. They see work as a means to fulfill a deeper need and will pick and choose the platform or client that best meets their needs, for example, by comparing insurance coverage.

Of course, they have doubts and stressors. Gig workers feel a host of personal, social and economic anxieties without the cover and support of a traditional employer. But studies demonstrate that their independence is a choice and that they would not give up the benefits that come with it. Another survey by Deliveroo found that three-quarters of riders were unwilling to trade greater security if it meant less flexibility.

Insurance is inevitable

In today’s tight labor market, any platform that is serious about scaling its talent management needs to build compelling benefits. The impact goes much further than reputation and talent management.

Uber has faced countless headline-generating battles in its quest to make ridesharing available. Insurance is an obvious part of the transportation industry. It’s required to drive a vehicle on the road in almost every market in the world. In its IPO filing, Uber noted: “Our business depends heavily on insurance coverage for drivers and on other types of insurance for additional risks related to our business.”

Insurance is the largest variable cost for LYFT. Tackling and dealing with the insurance cost has a massive impact on the company’s business model. It’s safe to say that sooner or later every platform is confronted with the issue of insurance.

Uber spent countless hours in meetings with insurers explaining the risk of ridesharing to underwriters. Luckily, the insurance world has seen the light and has started to understand the opportunity presented by gig economy platforms. Unfortunately, their products and company structures are still very difficult to match with a global platform. Hence the reason for the existence of specialized insurtechs, such as Qover. So, what are some things to watch out for or questions you should ask an insurer?

Aligning Insurance Cost With Your Business Risk


Gig economy players tend to underestimate the complexity of launching a global or even pan-European insurance solution. There might be one global account manager, but the day-to-day operations will be managed locally in each individual country. How will the insurer handle these geographical challenges? How are they represented in each market? It can add unnecessary layers of complexity that penalize the platforms as it often leads to an increased cost of operations.

The only way to enable a standard process, uniform coverage and quality of service is to work with a partner that has centralized operational services.


Insurers rely on their statistics to measure the risk they cover. Try to gain an insight into how their premiums are calculated, as it gives you room for negotiation. Are they able to connect to your logs? Maybe you have implemented measures to improve safety?

Insurance is all about statistics and prevention. The more data you connect, the more you will be able to optimize insurance costs in the mid-term. Build your case and make sure the insurer has all the information and fully understands the risk you would like to cover.


Your users are more than likely digital natives or feel very comfortable online. If you communicate through digital channels, is the insurer able to handle chat, e-mail or even WhatsApp communication?

Would you prefer a digitized claims process? It’s probably the biggest moment of truth in insurance, so take your time to dive into the specifics. Are they able to accommodate this and interface with your platform?

Customer Satisfaction

Is the insurer tracking customer satisfaction? Are they comfortable sharing those results and doing regular reporting? After all, if you offer insurance and the experience is lousy, it will rub off on you. For reference, Qover’s CSAT post claim is over 95%.

This is where a standardized and centralized operations structure shows its strength. The ability to help users in their own language is critical.

Coverage for the gig economy—where to start?

Personal Accident

Some gig workers are vulnerable and exposed to dangerous situations. Someone who delivers parcels on a bike might be involved in an accident, for example. For this type of work, it is critical to cover medical expenses, dental benefits or, in the worst cases, even a fixed indemnity.

Also bear in mind that the family of a platform worker might be highly impacted by this. In case of hospitalization, they might be faced with extra costs for childcare or transportation. Special family benefits in the coverage can help them tackle these expenses.

Temporary Incapacity

If, after an accident, a gig worker is unable to go to work for a couple of weeks or even months, he or she will soon find themselves in a difficult financial situation. Temporary incapacity benefits protect their income if they can’t work anymore. This usually takes the form of a daily allowance for a specific period of time.

Insurers are not keen on covering the extra risk but ask them to cover temporary incapacity in case of sickness as well. After all, if a gig worker is sick and can’t go to work, they will face the same financial issues as after an accident.

General Liability

Highly skilled freelancers face other issues. They are not covered by the public or product liability of the ordering customer. They would need to purchase insurance themselves to cover any damages they could cause to a third-party during their work.

Many freelancers who only work a couple of hours per month will never get such coverage because it would be too expensive. Yet they are exposed to a real risk.

If a platform could provide general insurance cover, it would remove a major hurdle for aspiring gig workers and even create a competitive edge over other platforms.

Insurance is a very complex issue, and a typical management team prefers to focus on building the business. They don’t have the insurance expertise in-house to steer discussions directly with insurers.

Unfortunately, insurance is an integral part of the gig economy. As we have tried to lay-out, there is no way to avoid it, but we hope this article has been helpful. If you have any other questions about insurance for the gig economy, feel free to reach out to us!

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