Global pressure to regulate the gig economy has created an opportunity for insurance and insurtech products that can address the needs of workers and the platform businesses who employ them. One of the hallmarks of the digital disruption era has been the emergence and evolution of the gig worker space, or the short-term jobs performed by freelancer and independent contractors all around the globe. These jobs, which may have started as secondary revenue streams or side hustles, have become the primary source of income for many workers even in spite of COVID-19 market changes. While gig economy workers enjoy independence and flexibility when it comes to their schedule, for many there’s a steep cost to that kind of freedom -- no holiday pay, no health benefits, and very little job security. As pressure to introduce new regulations for gig workers grows, an opportunity has emerged within the insurance and insurtech space to create new products and coverages that address the needs of workers and the platform businesses who employ them.  

COVID-19 and the gig explosion  

In the two years since COVID-19 disrupted the global economy, we’ve seen shifting consumption trends impacting competition for gig economy platforms. The increased reliance on food deliveries, as one example, have put more pressure on employers to create sustainable pricing and salary structures for employees. This shift includes a focus on workers’ rights, and specifically what kinds of protections employers should be offering all of their employees, especially for those platforms whose business models rely upon a freelance workforce.  

Insurtech can help in closing the protection gap as most part-time and even full-time gig workers remain excluded from the benefit pool. While the fight for expanding health insurance coverage and benefits is sure to continue, there is a growing understanding that the work of gig employees carries specific risks that require coverage beyond the protections of personal insurance. For these gig workers and their employers, protection gaps are a serious issue. Some specialized insurtech startups have responded by creating flexible, tailored and on-demand insurance policies customized for the gig economy. Collective Benefits, a UK based insurtech startup offer products specifically for the gig space, offering innovative insurance solutions including professional liability insurance, accident insurance and income protection for gig workers who need a financial safety net in the event of illness or an accident. These types of short-term, pay-as-you-go, embedded policies are perfectly aligned with the gig economy – often relying on AI and other novel data technologies to bypass more traditional (and slower moving) underwriting processes.  

The success and rapid growth of the gig economy demands a closer look at both the social protections these workers require and what happens if those measures aren’t put into place. While we can’t predict exactly how the gig worker space will continue to evolve, market trends and labor activism both spell opportunity for the insurance industry. Insurers should be looking at partnerships and products that address protection gaps within the space and that allow for the kind of flexibility and scalability the gig economy requires.  

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