In a move towards greener forms of transport, the UK government will be holding consultations that could result in the legalisation of e-scooters in the country. The adoption of e-scooters could open an untapped market for insurers and brokers that can quickly adapt their product offerings in a segment that poses liability challenges.
Fleets of e-scooters are appearing overnight in many cities across the globe in the hands of companies like Bird, Lime, and Flash. Findings from GlobalData’s Thematic Research: Sharing Economy in Insurance report highlight that the use of e-scooters for hire heightened over the course of 2018 in the US, having been launched just a year prior. The National Association of City Transportation Officials estimates that e-scooters have become the largest shared micromobility category, ahead of station-based bikes. Normally, riders using e-scooter rental platforms are liable for any damage or harm caused by their use of the e-scooter, although they are not always aware of this. Meanwhile, insurance policies for this type of shared micromobility model are scarce.
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Our report also indicates that challenges stem when accidents are reported. In the US, a rider with private health insurance will likely be covered – at least to some extent – if they injured themselves. But if the accident caused injury to a pedestrian or property, then questions regarding liability arise. Other insurance policies, such as home or car insurance, may provide cover for damage caused by a third party, including shared mobility users.
Some countries require e-scooters to be used solely on roads, while in others they should be used on pavements. In countries like Japan, e-scooters capable of reaching a specified speed are treated as motor vehicles altogether. Thus, the adoption of legislation clarifies how these vehicles should be treated.
The use of shared e-scooters can bring a wealth of benefits to urban mobility models, particularly as they offer riders a green and inexpensive mode of transport, while they can be easily deployed at scale. In the UK, regulatory consultations starting in February will shine light on whether the use of e-scooters will be legalised in the country. In this respect, the British Insurance Brokers’ Association campaigned in favour of their legalisation in its 2020 manifesto.
With the e-scooter market booming in many countries worldwide, insurers that can act fast and innovate will be able to capitalise on the opportunity, particularly as the market has not yet reached its full potential. There will be, however, challenges to overcome.
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By GlobalData
