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= When two people connect, they agree to support each other with a small amount of money in case of a claim (e.g. max. 30€). The more connections a user has, the higher his support in case of a claim.




'When two people connect, they agree to support each other with a small amount of money in case of a claim (e.g. max. 30€). The more connections a user has, the higher his support in case of a claim. The insurance provider only has to regulate the part of the claim, which lies above the network support, and he rewards the policy holder with a payback. With about 10 connections, a payback of 50% of the insurance fees can be achieved." (

2. Ben Schiller:

"Could socializing insurance lower costs for everybody? A three-year-old insurance startup from Berlin thinks so--and, in fact, it's proving it. Having signed up thousands of customers for its peer-to-peer insurance platform, it says premiums are typically 50% below what other companies charge.

When someone signs up for Friendsurance, they join with a group they already know or people they select from a list the company provides. They pay a premium upfront. But if no one in the group makes a claim within the year, everyone gets reimbursed. The group handles small claims itself, and an insurance company backing the arrangement steps in for bigger claims. If 10 people are each paying 50 euros annually, the maximum in-group claim would be something like 500 euros.

Co-founder Tim Kunde says there are two main reasons people save. First, friends are less likely to cheat on each on other. "All of a sudden, it's not just the big insurance company I'm hurting, it's concrete people I connected to and that I know have a disadvantage now." The optimum group size is 10, he says.

And two, people are good at making assessments of each other, and will probably pick people who they think will make less claims. Kunde says Friendsurance, which is an intermediary for actual insurers, passes on 20% to 40% fewer claims than other companies.

Kunde says it took a long time to convince the insurance industry to co-operate with Friendsurance. The company has had to tweak the model a lot to make it effective. But now he feels confident he has something that can grow further. The site currently offers four insurance products, including third-party liability and household insurance, and is looking at expanding into car insurance and other markets.

Friendsurance currently has a "good five digit number" of customers (it won't say exactly how many), most of whom are in the 20- to 40-year-old age group, Kunde says.

It will be fascinating to see if Friendsurance, or similar ideas, gain traction. Peer-to-peer insurance seems to make sense for all sides. It might also be possible to go further than Friendsurance and set up a wholly-peer-based system (with no outside insurer). That's what Peercover, a U.S. startup that launched in September, is doing (founder Jared Mimms calls Friendsurance "false prophets"). But, as yet, it's too early to say whether something like Peercover will succeed. Friendsurance got where it is today as much because of the persistence of its founders, as the originality of the idea." (


TrustCloud Community Manager Francesca Pick talked to Tim Kunde, the founder and Co-CEO:

"Friendsurance has a very unique and revolutionary approach to insurance. By using the power of social networks, your service is able to offer liability, legal and household insurance at a very low rate. Tim, how would you describe your business model in a few sentences?

Friendsurance brokers insurance coverage from various companies in the insurance market. What is unique about the insurance plans we offer on Friendsurance is that small insurance claims are covered by the social networks of our customers, while big claims are still covered by the insurance companies. This system reduces a number of costs, as for instance fraud, and has the result that we can return cash to our customers each year, without reducing their coverage. The process of covering claims through your social network is automated, so that no additional effort is required by our customers.

How was the idea for Friendsurance born?

Our founding team had been looking at large online trends for a while, social networks obviously being one of them. What struck us was that this trend had not entered the insurance market at all, although, in its origins, insurance used to be a very social product: hundreds of years ago, big families and villages joined forces to help each other out when there were fires or floods. In a way we are trying to recreate this type of system with modern technology.


This idea is very innovative and is probably not so easy for some people to initially understand. What reactions to your service have you received so far?

In the beginning, people didn’t understand the idea–and when they did, they were often skeptical or even scared. Now, after numerous usability tests and steps of product innovation, most people who get in touch with us like our model and also use it, because they realize that Friendsurance offers a risk free way to save money with little effort.

What have been your biggest challenges so far?

As always when new ideas are born, not everybody is easily convinced. So, apart from the “normal” challenges of finding investors and a good team, we had to convince insurance partners as well as customers of our model. This takes a lot of time and effort, and only works if you listen to user feedback and constantly improve your product to meet your customers’ needs. I think, this is something Friendsurance has become very good at." (

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