➤ Mobilitas, a new commercial insurance company covering businesses and individuals involved in the ridesharing industry, has partnered with Lyft to provide coverage for its drivers in 11 states.
➤ The CSAA Insurance Exchange subsidiary has developed mileage-based policies that cover Lyft Inc. drivers in Colorado, Idaho, Montana, Minnesota, Nebraska, North Dakota, Oregon, South Dakota, Wisconsin, Washington and Wyoming.
Eric Ummel came to CSAA Insurance Exchange in February 2019 with more than 25 years of experience in commercial insurance with Liberty Mutual, Safeco and Allianz Firemans Fund to help build what would become Mobilitas Insurance Co. of Arizona The company, which officially launched on Oct. 6, was initially conceived to focus on vehicle subscription, but that has since widened to target what Ummel referred to as "the connected on-demand economy, which goes beyond just vehicles and subscription."
Eric Ummel, General Manager, Mobilitas Insurance
Ummel talked with S&P Global Market Intelligence about the new company's focus on ridesharing, its partnership with Lyft and what lies ahead as the economy remains in flux during the COVID-19 pandemic. The following is an edited transcript of that conversation.
S&P Global Market Intelligence: What changes in the insurance market have inspired Mobilitas' focus on the ridesharing economy?
Eric Ummel: We've certainly seen any number of business types emerge in the sector over the last five to seven years, and ridesharing is the largest and most stable of all of them. However, as fleet owners are looking to deploy their units into the marketplace, ownership models change, business needs change and insurance needs change. So we want to be a carrier that can come in and rapidly respond to emerging exposures in this marketplace and develop products that add value for business owners and individual drivers alike.
What advantages do you see in concentrating on the ridesharing market?
We've picked a sector where we can provide a really singular focus that allows us to develop deep expertise, digital capabilities, and leverage things like telematics and digitally delivered loss-control risk management. We think our ability to go deep to understand the needs of our clients and develop capabilities where we have differentiating expertise will provide real opportunities for us.
Your commercial coverage is based on data gathered from your mobile app, as well as Lyft's. How else is that data being used and are there plans to use devices such as dongles?
We think that there are real opportunities ... to provide business owners and individuals with data about the way they drive. That creates safer roads and also helps our insureds have some stake in the premiums that they pay. In future products we'll use those devices. We'll leverage both dongle and app-based embedded software development kits, as well as direct access to OEM technology. We haven't built all those capabilities yet, but that is our vision.
The COVID-19 pandemic hit just as you were preparing to launch. That had to cause you some concerns.
In March and April, we saw a significant downturn in rideshare usage and ridership. As we looked at that, we understood that we'd already committed a lot of resources toward this space. We also have confidence in the broader U.S. economy, that things are going to return. We're all keeping our fingers crossed, but we wanted to continue to lean into this space with confidence that ridership would increase and that the economic headwinds would slow.
Have there been any other challenges or obstacles you've had to overcome prior to starting up?
We have been developing our own institutional knowledge and capabilities around rideshare. I came to CSAA to start Mobilitas because of my commercial insurance background. I've been able to build a team around me, but I also have leveraged our own capacity at CSAA. In terms of every functional area, we've built out claims capabilities. So I wouldn't say that there have been obstacles, as much as opportunities to build out capacity and prepare ourselves for this launch and to continue to grow the business.
The company really started to take shape last year after Tom Troy came on board as CSAA's CEO. How did he influence the process that culminated with your launch?
When Tom was at Allstate, he was instrumental in their entrance into ridesharing and writing commercial rideshare coverage for Uber. When Tom came to CSAA last year, he brought institutional knowledge and industry connections that allowed us to focus in this area. And so we got busy building out internal capability and building relationships with Lyft starting last year that have culminated with our entrance in the market this year.