Chinese consumers most likely to use sharing economy, least likely to buy insurance, survey finds
Chinese consumers are more willing to use the sharing economy platform to hire holiday homes or rental cars than their counterparts in the US and UK, but they are the least willing to get insurance cover when using these services, according to a Lloyd’s of London survey released on Wednesday.
The survey was based on 5,000 consumers, including 2,000 in China, 2,000 in the US and 1,000 in Britain. The survey also polled 30 sharing economy companies with a focus on how they manage risks.
The sharing economy companies, including Didi Chuxing, Uber Technologies and Airbnb, use the internet as a platform to connect providers and customers.
The survey showed that Chinese customers are the most willing to use these platforms, even as they believe there are risks involved. Some 68 per cent of Chinese customers believe the benefits of using the sharing economy are greater than the risks, compared with 58 per cent of US customers.
Chinese customers ranked as the least likely to buy insurance coverage when using sharing platforms to hire cars or holiday homes, whereas Britons ranked as the most likely.
About 71 per cent of Chinese consumers believe platform providers such as Uber and Airbnb should provide insurance cover to safeguard their interests, while 21 per cent said it should be the home or car owners responsibility to arrange it.
Opinion was more evenly split in the US, with 43 per cent of respondents saying it should be the platform providers who provide insurance, while 40 per cent saw it as the duty of homeowners or car owners. Consumers in Britain were split down the middle on the issue, with 39 per seeing it as the duty of platform operators, and 39 per cent viewing it as the duty of asset owners.
“The sharing economy itself created a completely new risk landscape with many untested assumptions around who should be managing risks and liabilities, but still, the significance of insurance cannot be understated,” said Trevor Maynard, head of innovation at Lloyd’s.
“As these risks are addressed and written in our market, we see the power insurance has to give consumers peace of mind and providers and platforms a sense of clarity,” Maynard said.
The survey showed 70 per cent of customers of these three markets would be more willing to use the sharing economy platforms if they are under insurance cover. Likewise, 71 per cent of asset owners would be more willing to let their car or home to be hired via the platform if they were insured by the platform.
Some sharing economy providers have bought insurance coverage from Lloyd’s to safeguard their customers and their own liability.
“In our work with sharing economy platforms, we’ve found that insurance not only enables growth, but can be tailored itself to grow along with sharing economy companies,” said Vincent Vandendael, chief commercial officer at Lloyd’s.
Among the biggest risks of using these sharing economy platforms, 52 per cent of respondents said they worry about personal safety, 42 per cent about the quality of service, 42 per cent on damage to assets, 40 per cent about theft and 38 per cent worry over the risks of a lack of sufficient safeguards in
the event that something goes wrong.
The economic value of the global sharing economy is expected to reach US$335 billion by 2025, up from US$15 billion in 2014, the Lloyd’s report said.
Lloyd’s is the oldest insurance company worldwide, utilising a collection of underwriters to provide various types of special insurance coverage. The company’s history could be traced back to 1686.