Insurance: How to Best Protect Our Sharers

Finding an appropriate insurance solution for Vrumi hosts has been a challenge, but after many meetings, we’re confident that we now have the best policy available. This blog is a more detailed explanation of why we think our community of hosts will be the best protected sharers around.


The insurance market has been slow to react to the growth of the sharing economy. Some of the reasons for this slow evolution include:

the lack of data available to insurance companies to assess risk;

the varied nature of sharing (meaning that one size does not fit all); and

a conservative industry struggling to comprehend a new way of earning and working.

Umbrella Policies

Given this, many sharing economy companies have developed piecemeal solutions to address the risks as best they can. This has led to most sharing economy platforms adopting a variation of an “umbrella policy” (See figure 1). This policy often focuses on catastrophic damage and is taken out by the platform to insure themselves against something going wrong for their “sharers” or providers of homes, cars, skills etc..

Figure 1:


Undoubtedly the coverage for these policies has improved over the last couple of years and, in some cases, has been supplemented by additional guarantees where the platform takes on some of the risk not covered by the insurance policy.

Whilst these policies do address many of the significant risks identified by the different platforms, we did not feel this arrangement was satisfactory for Vrumi hosts, because:

(1) The insurance doesn’t follow the risk – Most of the risk for sharers resides with them. It is their property which is licenced for guests to use for work purposes and it is their property that is at risk; it makes sense, therefore, for the hosts to be the insured person, not the platform.

(2) Battle of Policies – An umbrella policy often may have a clause saying claims should be made on your own home insurance in the first instance, or there are areas that are covered by both the umbrella policy of the platform and the host’s own home insurance raising the question of which policy should be claimed against. This may create uncertainty and tension between the platform and the host as to who should claim. In certain circumstances there may be a risk that both policies could be voided. In a business usage context, this uncertainty (perceived or otherwise) is not helpful for the host or the guest.

(3) Aggregation – By relying on an umbrella policy, a sharer is relying on all of the other users not making claims that jeopardise their own property. Most policies will have a claim limit. Meaning that the platform is unable to claim for, say, more than £3,000,000. If you have a platform that has many claims in a year, your property may not be insured. Again, in the context of individuals facilitating property usage for business purposes, we did not think this uncertainty and risk was acceptable.

There are some other challenges with umbrella policies, but these are the main areas we have been most concerned about for Vrumi Hosts. Given this, we strived to create a policy that meant Vrumi hosts have the primary relationship with the insurer.

Own Home Insurance

Of course, the best solution is for each Vrumi host to be directly insured under their own home insurance policy. The first recommended step for all hosts, therefore, is to check their own home insurance to see if they are covered for renting out rooms using Vrumi. If a host has sufficient cover, there is nothing further to do; certainty for the Host has been established.

Insurance arranged by Vrumi

For those whose home insurance does not cover Vrumi activity or for those who are unsure, we have negotiated a policy for you to opt into on a transaction-by-transaction basis and payable only out of the proceeds of a booking. Sharing Economy insurance specialists, Safeshare, have put this policy together on our behalf.

Under this policy, Vrumi is the master policyholder and each individual host is a named “insured person” for each transaction made through the website. Every host has confidence that the insurance policy:

provides their own coverage;

is suitable for Vrumi use; and

is unaffected by the actions of other Vrumi users.

The structure of the Vrumi policy is summarised at figure 2.

Figure 2:


Summary of Insurance

At this point in time the Vrumi arranged policy provides the following cover:

Public Liability: £ 2,000,000

Buildings: £ 500,000

Contents: £ 75,000

Accident to Domestic Staff: £ 5,000,000

Next Steps

We are pleased and proud of this insurance policy and believe it is the right structure for our hosts, giving them the most appropriate coverage when using Vrumi.

We have more that we want to do. The additional fee for insurance for each transaction at this point in time is £2; this represents good value for the cover provided, but we want to bring this down further where possible. We also want to increase the threshold limits and offer a “Gold” policy for owners who would like greater cover. As we grow we will be better able to succeed in these negotiations. The insurance market may also move on and, along with our specialist advisors Safeshare, we will continue to monitor developments and create solutions that we believe are best for our hosts.


Solfyre and SafeShare Global partner to disrupt the sharing economy with new identity theft and fraud insurance solution

SafeShare Global teams up with Solfyre to develop offering solving login and fraud issues and revolutionise the cyber security insurance market

London – 11th February 2016 – British cybersecurity pioneer Solfyre and London based SafeShare Global, an insurance and technology startup enabling the sharing economy, have today announced a partnership to develop the world’s first identity theft and identity fraud insurance solution.

Solfyre Company Logo
Solfyre Company Logo

According to a white paper released in 2011 by the Detica and the UK Cabinet Office on the Cost of Cybersecurity it estimated the total cost of cybercrime in the UK to be £27bn annually, of which it cost UK citizens £3.1bn (£1.7bn identity theft and £1.4bn online scams) annually.

The Office of National Statistics (ONS) has now included cybercrime statisticsfor the first time when releasing national crime statistics. Due to cybercrime and other fraud being missed out of official data – the Office for National Statistics has carried out new research showing the total number of crimes is double what was previously thought. There were 5.1 million estimated cybercrimes and frauds last year plus 2.5 million offences under the Computer Misuse Act – hacking, identity theft, malware, and so on.

Solfyre SID iPhone app is available in the App Store soon. Android and Windows Mobile versions will be available in Spring 2016. The new app ensures that unique and complex passwords can be used for all of your online accounts including online banking without the need for each password to be written down. Instead it is encrypted on your phone and not stored on the Internet.

The partnership between Solfyre and SafeShare will provide another layer of protection to those active online by developing new state of the art, pay as you use, identity insurance products.

Craig Vallis, founder and CEO of Solfyre said, “I am very encouraged to see that the authorities are at last taking cybercrime very seriously and feel that we as individuals need to be keeping up to speed with our online identity and safety. This is why we are anticipating great success in partnering with SafeShare to help people satisfy their identity and privacy insurance requirements.”

SafeShare’s ambition is to protect every transaction that occurs in the sharing economy, and to create the necessary security to ensure that it thrives. Through striving to protect the platforms, they hope to simultaneously offer assurance to relevant investors that their interests are also protected. This philosophy forms the basis of the partnership with Solfyre in the cybersecurity space.

Alexander Steinart, CEO of SafeShare explained, “Solfyre is a shining technology business giving back personal data ownership to consumers. We are extremely excited about working together on this project, as SafeShare’s ethos is based around enabling more control and peace of mind for our online activities.”

Solfyre has recently received global recognition by being shortlisted in three categories of the Tech Trailblazers Awards. Voting closes on Friday, 12th February. The IT community can support Solfyre in the Mobile, Security and Firestarters categories here:

About Solfyre
Solfyre is a British startup specialising in identity and password management.

Headquartered in London, the company is committed to igniting the Identity Revolution. The first step is the development of SID, a mobile app that simplifies password management and ensures passwords are always secure and always accessible. The app will available as an IOS version in November and Android and Windows Mobile versions available in early 2016.

For more information, visit the Solfyre website on: or follow them on Twitter on

About SafeShare Global
SafeShare is an insurance technology business, created to capitalise on innovation in the insurance market. The company works alongside emerging technology businesses, developing ‘smart insurance’ products to cover our increasingly dynamic and technology-enabled lifestyles. SafeShare’s aim is to develop the insurance infrastructure to support and build confidence in rapidly evolving worldwide markets.

Partnering with SafeShare to create the Ad-hoc Insurance of the Sharing Economy

The sharing economy presents different challenges to those of the rental sector. Traditional insurance excludes property damages by paying guests and household insurance does not cover damage from third parties, amongst other limitations. enables anything from lockers to villas to be rented in an ad-hoc, peer to peer fashion. For small items, our build-in deposit system will be often sufficient, but for higher value property, such as vehicles, office spaces or apartments, we have partnered with SafeShare to provide Slock users with a leading insurance product.

Because it supports almost any use case in so many countries, SafeShare is an ideal partner for

With Safeshare, smart contracts will be able to offer a revolutionary , universal, on-the-spot insurance where users pay only for the type of insurance they need, when they need it. The insurance provider will read from the Ethereum blockchain when the objects are rented out, and owners will only pay for the time the property was required.

The simplicity and elegance of the implementation of the insurance mechanism prototype we are developing with SafeShare would surprise many — it is worlds away from the horribly expensive, slow to implement SOA frameworks from traditional integrators. In many respect, it’s a perfect example of how blockchain technology creates new business opportunities while reducing the cost of operations for the companies that adopt it.

We encourage you to learn more about SafeShare and their amazing team on their website:

About the Author

Stephan Tual is the Founder and COO of

Previously CCO for the Ethereum project, Stephan has three startups under his belt and brings 20 years of enterprise IT experience to project. Before discovering the Blockchain, Stephan held CTO positions at leading data analytics companies in London with clients including VISA Europe and BP.

His current focus is on the intersection of blockchain technology and embedded hardware, where autonomous agents can transact as part of an optimal Internet of Things economy.

Twitter: @stephantual

Insurance Is The Unlikely Key To the Sharing Economy’s Future

The potential to come home to find your house trashed is every Airbnb host’s nightmare.  It’s not unknown to happen with one London user recently finding their New Year’s Eve ruined by a guest who decided to turn their flat into a nightclub. These kinds of incidents often attract media attention to the accommodation-renting platform and drag up a question that hangs over much of the sharing economy – who’s responsible when things go wrong?

Collaborative consumption, from Uber to crowdfunding, is based around trust and when high-profile cases rattle consumers many companies suffer. This is prompting a new wave of startups to build the background services that the sharing economy needs to grow. These include the likes of background checking platform for sharing economy workforces Ofido, which raised USD4.5m last year, as well as startups looking to rethink insurance for this disruptive new industry.

“The sharing economy has come out of nowhere and insurers are just getting their heads around it,” says Alex Steinart CEO of sharing economy-focused insurance startup SafeShare. “Traditional insurers use a broad brush and either cover personal life or businesses without any cross over.”

Now insurance firm Aviva is getting into the space with its Canadian arm preparing to offer a policy specifically for drivers using their own vehicles to work for ride sharing and carpooling services, such as Uber and Lyft. It comes as Toronto begins to rewrite its transport laws with these new services in mind. The presence of a high-profile insurer in the space offer validation to the industry and European long-distance, ride sharing firm BlaBlaCar also works with Axa to offer its  users policies with insurance in mind. In an industry built on trust providing piece of mind for users is a must and to that end insurance’s role will only grow.

airbnb paris long

Big Expectations

Led by the soaring growth of Uber and Airbnb more consumers are looking to sharing economy and collaborative consumption services, accessed through mobile apps. Investors clearly have a lot of faith in these services, with Airbnb and Uber reportedly sitting of respective valuations of USD25.5bn and as much as USD60bn. Many forecast massive revenues for sharing-based business models over the coming years.

> PWC estimated that the sector could generate USD335bn globally by 2025.
> The UK’s cut of that could be as much as USD15bn.

However, to meet these lofty predictions the industry needs to clarify grey areas such as government regulation, the status of employees and insurance.

Insuring The Sharing

The sharing economy is held back by grey areas such as what taxes users are susceptible to, with Airbnb only recently beginning to collect tourist taxes. The company also now offers a guarantee for damaged goods of up to USD1m that users can apply for. Steinart highlights new approaches to insurance as a force to encourage participation in the sharing economy.

Insurance is a space poised for significant disruption this year as fintech entrepreneurs turn their signs on disrupting its outdated systems. Insurance still generally works on an annual payment model and as data-driven businesses, insurance firms are unprepared for an industry that has emerged so rapidly. The disruption of insurance is expected to massive and lucrative and there’s a real role for sharing economy companies to help shape its future.


Shared Space

Imagine this.

A user of an accommodation rental site decides to rent out her New York apartment for a week to a young couple. During their stay, she receives numerous emails from the couple describing how thrilled they are with the apartment and the wonderful time they are having during their stay.

One week later, the owner comes home to find her apartment completely ransacked and several expensive and sentimental items stolen. Walls have been cut through to access safes containing valuables, passports and social security information.

When attempts are made to contact the couple, it emerges they had created a fake profile that they abandoned soon afterwards, making them impossible to track down.

When the apartment owner contacts her home insurance company she finds she is not covered for the loss, due to the fact her property was being used for commercial, profit-making purposes, and not for personal use as stated in the policy.

When she contacts the accommodation rental site, the company also tells her they are unable to help – leaving the owner to foot the bill.

This experience sounds like a horror story, but it is in fact the real life experience of one Airbnb user in 2011.

The tale highlights one of the biggest challenges of the sharing economy. When things go wrong, who pays out?

The long and short of the situation is, in a world where people are increasingly using technology to share their personal assets for financial gain, fit-for-purpose insurance solutions are few and far between.

In the 2011 Airbnb case, the company worked with the Lloyd’s market to offer a host guarantee providing £600,000 of cover for damage caused by guests.

This was later extended to the Host Protection Insurance programme, which provides primary liability coverage for up to $1mn per occurrence in the event of third-party claims of bodily injury or property damage.

The coverage, written through Apollo’s Lloyd’s syndicate, is also subject to a $1mn cap per listing location and certain conditions, limitations and exclusions.

Sharing boom

So is the insurance industry missing out on a lucrative opportunity to provide an insurance solution for the sharing economy?

By definition, the sharing or collaborative economy is a socioeconomic ecosystem built around the sharing of human and physical resources, often enhanced by the use of technology.

Economists believe the sharing economy is set to boom in the next 10 years. The concept of sharing resources has already created 17 billion dollar companies worldwide – although sharing economy purists would argue that the largest company, the $50bn Uber, is a technology-enabled on-demand minicab service, rather than a textbook sharing economy company.

Nevertheless, users are already becoming more receptive to the use of sharing economy companies.

According to a survey from sharing economy forum Crowd Companies and cloud computing provider Vision Critical, 51 percent of more than 50,000 US respondents said they had used technology to access sharing services in the past 12 months. This is a significant step up from 39 percent the previous year.

The research suggests more than 110 million North Americans are now part of the sharing economy. Participation has grown by 25 percent in the past year: for every four people who were sharing a year ago, the sharing economy has attracted one new recruit.

PricewaterhouseCoopers (PwC) estimates that the five main sharing economy sectors – peer-to-peer lending, online staffing, peer-to-peer accommodation, car sharing and music and video streaming – currently generate $15bn in global revenues.

By 2025, these same five sharing economy sectors could generate a potential revenue opportunity worth $335bn. PwC estimates the UK’s slice of the pie could be worth around $15bn alone in 2025.

Insurance lag

But the insurance industry is yet to rise to the challenge of this rapid growth. Experts tell Insider Quarterly only a handful of carriers have developed insurance covers for sharing economy companies, and this is a very much on a case-by-case basis rather than in a concerted effort to address this gap.

Hiscox, Catlin, Apollo and managing general agent CFC are examples of companies that have sought to tackle the risk. The British Insurance Brokers’ Association has also pledged to help tackle the insurance gap head on – although the list does not extend much further.

Alex Steinart is CEO of SafeShare Insurance, a broker launched this year specifically for the needs of the sharing economy. “We set the company up because there is no obvious route for the business to come into – there aren’t a lot of underwriting products out there,” he says.

“We saw an opportunity to develop bespoke solutions for various types of sharing economy businesses with certain Lloyd’s syndicates.”

Two forms of insurance coverage have emerged for sharing economy companies. The first is a type of umbrella policy for the sharing economy firm; a variety of backstop facility that will pay out in the event the user’s insurance company does not.

This is the type of arrangement understood to be used for Airbnb’s Host Protection Insurance programme.

The second provides insurance on a per-transaction basis – for example, having opt-in cover solely for the 24 hours someone is staying in your flat, or the three hours they are borrowing your garden tools.

“These are products which are very much in the pipeline,” says Henry Sanderson, technology and media underwriter at CFC. “The transactional cover is the most exciting part and, to me, signals the biggest opportunity – the high-volume, low-premium business.”

These coverages are still in the development stage as they require a huge amount of investment in technology and expertise, he adds.

However, the investment is not the only thing holding insurers back in addressing these risks.

There is little historical data on these companies, and while many start-ups are recognising the importance of collecting data on their client base and business, underwriters have little concrete evidence to accurately price their product with.

“It’s hard to know the true claims picture [at the moment] because almost all sharing economy companies will want to keep this out of the news,” explains Sanderson. “But I believe that the claims are limited, due to the important aspect of trust that underpins the sharing economy.”

Similarly, the apparent under-regulation of the sector is making some underwriters jittery.

The Insurance Council of Australia (ICA) has previously called on governments to clarify the regulatory environment governing sharing economy businesses.

ICA CEO Rob Whelan said in an October statement that insurers will respond quickly to market demand once regulations have been set down.

Sanderson adds it is extremely important for these companies to take it upon themselves to have a clear on-boarding process – making sure every user is verified and has had all the necessary checks. “That makes my job as an underwriter far easier.”

However, many insurers are also not seeing the reward in return for the risk – or the investment – involved in insuring these companies. Often, the premium involved with insuring these risks is not enough for an insurer to commit.

While some sharing economy start-ups have substantial financial backing, many are “two guys working out of their bedroom”, notes Steinart. “The products need to be an appropriate price for both the insurer and the insured.”

Perhaps most strikingly, “in speaking to some markets about this, they had not heard of the sharing economy at all”, says Steinart. “There is a lack of awareness which exists in the industry.”

Look sharp

But it may be that insurers will be forced to fix up and look sharp on sharing economy risks.

As sharing services grow, insurers could see an increase in notifications on their general property or liability policies for events related to sharing services, warns Rhiannon Webster, a partner at law firm DAC Beachcroft.

“In many products we have looked at, it is quite obvious there is room for dispute,” she says. “For example, a standard car insurance policy would cover certain areas of car sharing, but there were areas which would have been excluded.”

There has not been a deluge of sharing-related claims disputes to date, Webster adds, but the challenge is clear – many products are not designed for sharing services. “Insurers need to ask more questions around sharing of assets to properly assess the situation.”

Naturally, bespoke insurance solutions for sharing services reduce the chance of disputes, and demand for such products is increasing steadily.

“We have definitely seen an increased demand from peer-to-peer marketplace businesses, but it has come from a wide spectrum of brokers,” Sanderson says. “I would say on average I will receive at least two enquiries a week and the conversion rate is certainly picking up.

“Brokers are still lacking a real understanding of this new business model, but interest is improving.”

In fact, the sharing economy is dependent on insurance to grow. The promise of financial indemnification in the worst-case scenario helps build on the trust factor that is the foundation of the sharing business model.

“The insurance and reinsurance market has a responsibility to offer policies to enable this growth,” says Steinart.

Once the insurance industry clears the initial hurdle, there is room for even more innovation with sharing economy risks.

“For me the next big opportunity for insurers to jump on is the business-to-business sharing economy – for example, businesses sharing manufacturing plants or services,” says Sanderson, adding there is a big employers’ liability question to be addressed in this case.

Following on from the per-transaction insurance coverages, areas for improvement include factoring in pricing fluctuations according to the quality rating of assets or services. This would work particularly well for handyman, ride-sharing or babysitting services, for example, explains Sanderson.

“This then moves onto the Internet of Things, or wearable technology,” he adds. “Then things get really interesting.”

This article was published as part of issue Winter 2015


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