Insurance takes the wave of cryptocurrencies

Is Mulhouse becoming the French-style bitcoin city? Two insurance brokers headquartered in the capital of Haut-Rhin, East Assur and Assurance du Lion, recently announced that they accept payment of premiums in cryptocurrencies for all of their products. Customers will be able to pay in bitcoin, ethereum, and tether at East Assur, as will Lion’s Insurance, where the option of paying in polkadot and cardano will also be given…

Mainly focused on car insurance, the two brokers, who respectively achieve 500,000 euros and one million euros in annual turnover, see it as a commercial argument in the face of the explosion of cryptocurrency users. “If last year the demand was already felt, we are seeing an acceleration this year. Between four and five interlocutors per month mentioned the idea of ​​paying their premiums in cryptocurrencies“, explains to Agefi an East Assur ruler. Like Assurance du Lion, East Assur has trained its teams to answer the questions of its customers.

Opportunities

Not enough to disrupt the sector, but enough to attract the curiosity and interest of competitors while cryptocurrencies are a source of opportunity. “Cryptocurrency allows you to do things you can’t do with traditional money. In parametric insurance, for example, the available databases can make it possible to have automated and programmed compensation providing a better technical guarantee for the insured. », Describes Claire Balva, director of blockchain and cryptos at KPMG France, who goes on missions with insurers on the subject.

This type of payment should remain focused on low-value and high-volume products for the time being, in order to ensure human validation on large amounts. The major players also take longer to offer such possibilities, the number of managers to be convinced being more numerous and they sometimes remain more conservative. But these announcements help to legitimize cryptocurrencies and therefore to feed a virtuous circle for their adoption despite the risks inherent in these assets. However, insurers are not insensitive to new risks: “This is a new market to cover“, reports Claire Balva.

Challenges

To limit the risks, the two Alsatian brokers have also chosen cryptocurrencies deemed to be less volatile than others. But in a country where the means of payment are operational and diverse with the arrival of new players, the usefulness of cryptocurrencies is not as real as in other countries. The two brokers thus recognize that the interested customers are mainly young people who see here an opportunity to sell their cryptocurrencies and not to weigh the insurance on their purchasing power through an alternative payment. Another challenge is the transfer of the digital wallet into euros. “For this task, we rely on Coinhouse. Beyond the technical capabilities, a great name reassures the customer but also reassures ourselves.“says a spokesperson for East Assure.

“The challenge will be mainly in the management of these cryptocurrencies. For large groups, for example, this management involves many technological, accounting and tax challenges.“Judge Claire Balva. Insurance will also not escape the anti-money laundering issues facing cryptocurrencies. Contacted, the Prudential Control and Resolution Authority did not wish to communicate on the subject.

Cultural facility

If France does not escape the wave, it has already affected other countries. At the end of April, Axa opened up the possibility for its Swiss individual customers to pay their insurance premiums in bitcoin, with the exception of their life insurance contract. “This pilot project aims to help us better understand the evolution of customer needs and to confront us with the new possibilities offered by technology.“, explains the group. He remains cautious: “Axa Switzerland does not invest in bitcoin itself, neither bitcoin nor other cryptocurrencies are listed on its balance sheet“. Switzerland has taken the lead in the field: the health insurer Atupri also accepts bitcoin and ethereum. “It is a more decentralized country than France, which leads to greater cultural ease in the adoption of cryptocurrencies“says Claire Balva.

On the other side of the Atlantic, insurtechs launched the movement this year. Property and casualty insurer for small business owners Universal Fire & Casualty Insurance Company (UFCIC) accepts bitcoin, ethereum, bitcoin cash and litecoin for some products, while auto insurer Metromile has made premium settlement possible but also compensation in bitcoin. The “Pay as you drive” cover specialist has also just been taken over by Lemonade, the start-up which intends “embody the insurance company of the 21st century” .

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