5 tricky questions about insurance in the digital age

While the world is going through a digital transformation in every industry, the way we deal with life and business must also evolve. The wave of Digital Transformation has enabled us to do so much so easily. Technology converts our talents, possessions, and even feelings into monetizable assets for our choosing and convenience.

Technology is powering the digital age. But what about insurance? For long, insurance has been the silent backbone behind much of everyday life and business. Does insurance have a role in powering this transformation?

Well, all progress comes with risk. And the digital age has a few risks of its own. Whether it’s letting out your home on Airbnb or investing in a product idea on Kickstarter, these new avenues and ventures all have different kinds of risks involved that you may need insurance for.

In this blog, let’s explore 5 such 21st-century situations that demand closer scrutiny.

If you own a car and drive for Uber occasionally then what kind of insurance cover should you take?

In our on-demand economy, Rideshare insurance is becoming a very popular product. Since a lot of people depend on companies such as Uber and Lyft for ridesharing, drivers are becoming aware of the insurance they need to protect themselves. It’s important to consider this policy because your average personal auto policy will not cover things such as waiting for your rider, going to pick them up, and transporting them to their destination of choice. Whereas a commercial insurance policy may be too expensive and far too detailed for your average rideshare driver. Think of this coverage as a something-from-both-worlds of personal auto insurance and commercial auto insurance.

Does my home need different insurance if I put it on Airbnb occasionally?

Airbnb accounts for 17% of immediately available short-term room occupancy across many US cities, making it a favored home-sharing service. What’s amazing about Air BnB is that they offer you insurance if you wish to list your home on their site. This is called Host Protection Insurance and is offered free of charge. While this is a lovely little perk for the service you provide, it may not cover all the essentials. Hosts should understand what they are still vulnerable to. Air BnB’s host insurance will not cover any damages which were caused to your personal belongings. They will also not cover intentional acts of damage, nor will they cover accusations of slander, or property issues. For example, if your guest drew on a wall, the paint job would not be covered. Natural calamities such as earthquake, flooding or sinkholes are not covered, irrespective of whether or not a guest is staying at your home at the time. So, if you have a vacation home that you plan to put on the Air BnB market, remember that their Host Protection Policy may not be enough.

Is it a good idea to buy insurance online?

Buying insurance online is like ordering your wedding trousers online – an important decision which you may be trivializing in the interest of convenience. Unless you have some snazzy, expensive VR or AR tech at your disposal, the possibility of you getting your perfect fit without a trial is super slim (we’re still talking about the wedding trousers here). If you take the efforts to go to the tailor and have your trousers made to measure, the results will be personalized, snug, and the best fit. The same goes for insurance. While there are a lot of convenience factors, and a significant amount of policies to choose from online, there’s a price that one pays for this kind of convenience. Off-the-shelf products are designed to address a wide range of possibilities but in a very generic sense. The problem is that there’s no cookie-cutter template for when things go wrong in your specific context. Your needs may be more specific, and an algorithm may not be the best product designer. If your needs are specific, a traditional insurance agency would be best for you since you can rely on the agent to understand exactly what risks you face and address them specifically.

Does my passion project or side hustle need insurance?

In a survey conducted last year, it was found that over 55 million Americans had some sort of side hustle going on, that’s almost 25% of the population! Whether it’s passion that’s fueling your side project or financial gain, you must consider the possibilities of something going wrong and the implications of that from a financial perspective. You would have made some investment in the form of tools, materials, partnerships and other purchases. So, what happens if something goes wrong? There are plenty of policies that cater to small businesses. So, consider building that plan B.

Do I need insurance for protecting my small business from gig employees?

Hiring freelancers or specialists as “gig employees” is a great way to support your small business. However, have you considered the worst-case scenarios? What if you get sued by your gig employees? What would happen if your business or property is damaged by them? What if they try to defame you or spill business secrets? Are these “on-demand” employees covered by the standard policies you have for your employees? Discuss these aspects with your insurance advisor. Ensure you cover the important stuff so that your small business insurance can step in as needed.

While the digital age brings with a plethora of opportunity and growth, it also poses a new category of risks which you must navigate with caution. In the age-old battle against risk, insurance has always been a keen ally for people and small businesses alike. It’s no different now. Make sure that you’re properly insured to take on the risks the new digital avenues may carry.