The new deal with Omio is part of an ongoing strategy by Setoo to partner with travel companies to distribute its insurance policies that target millennials
Insurtech start-up Setoo has partnered with travel aggregator Omio to provide insurance products that skip the claims process and pay out automatically.
Customers of Omio – formerly GoEuro – booking air travel will have the option of purchasing insurance from Setoo for their trip, which will trigger payouts automatically should their transport be delayed or cancelled.
The partnership follows another deal struck in May this year with lm group, the firm behind cost-savvy online travel site lastminute.com.
Noam Shapira, co-founder and co-CEO at Setoo, said: “We’re thrilled that Omio’s customers will enjoy a new insurance experience as a result of Setoo’s platform.
“Omio is revolutionising the travel experience and has recognised the strength of our offering to support its unique approach.”
The deal with Omio is part of Setoo’s strategy of distributing its cover through third-party companies looking to enhance their own proposition to customers, especially those from generations Y and Z.
Chris Hall, commercial director at Omio, said: “We are delighted to partner with Setoo as we look for new and innovative ways to help our customers travel.
“I’m excited by Setoo’s innovative approach and I look forward to what the future holds for our customers.”
How Setoo automates the travel insurance claims process
No-touch claims are a trend in the insurance industry being driven by customer demand for less friction before a settlement, and parametric (also called index-based) cover is one of the more trustworthy ways to achieve them.
The term refers to cover that is agreed and paid for based on the understanding that the trigger for a claim will be objectively verifiable, leaving no room for disagreement from either side.
In Setoo’s case, this means the delay or cancellation of a transport arrangement, something it calculates the risk for using AI.
The insurtech’s lead actuary Udi Makov said: “Parametric insurance enables protecting against a wide range of risks, exposures and threats.
“It’s not merely an indemnification product; it’s coverage where a benefit payable is determined prior to policy purchase, by estimating the loss at superior accuracy and speed.
“This is possible through the integration of machine learning algorithms and advanced actuarial predictive models, which allow the development of powerful tools ideally suited to swiftly predict and hedge risks in a digital era of challenging data, thus providing optimal insurance solutions in fast-changing environments.”
Millennial and Generation Z market opportunity
A main ambition of Setoo is to use its insurance products to increase the take-up of travel insurance for transport delays, cancellations, bad weather and lost luggage among millennials and Generation Z.
Taking advantage of the propensity for customers from both generations to buy online, the start-up’s proposition to travel businesses with an online focus is that adding the option of insurance that appeals to a younger crowd will provide them with a supplementary income.
Setoo’s marketing director Elana Marom said: “E-businesses are uniquely positioned to deliver their consumers a new insurance experience.
“This means no more one-size-fits-all products offered in the customer journey by third parties; no more ambiguous policies or claims processes.
“Instead, e-businesses should adopt insurance platforms that leverage technologies like parametric insurance, AI and machine learning, enabling them to create simple protections that are tailored to consumer’s individual needs and generate automatic compensation.”