Bringing a gentle revolution to a previously rigid and detached market, new car insurance platform ‘Guevara’ encourages people to work together. This peer-to-peer (P2P) based service is making the process of taking out insurance more fun, personal and transparent. “Every one of us in the business has had a bad experience with insurance,” says Guevara’s co-founder and marketing manager Rich. “We’ve got a passion to do something that’s slightly different… and make a difference.”
Drivers using this new system can expect the same cover, only without the marketplace. The system is simple. You pay money with other members of a social or community group into a pot. Whatever is left over at the end of the year, after any claims have been made, is returned, minus a small fee.
I’m meeting the pair in an airy Sydney Street café, both of them having spent the morning on the seafront picking litter with The Big Clean Up. They’re young, enthusiastic and confident they’ve created something game changing. At the moment, Guevara has only been rolled out in Brighton & Hove and its surrounding areas, but the city has been quietly utilising other P2P services for decades; everything from car shares to leaving useful items in the street. “It thrives on change, in making things better and believing there’s a future which could be better,” says JP. As a place where people genuinely understand the power of working together, Brighton offered the platform an ideal test bed. “Everyone we’ve talked to gets it very quickly,” agrees Rich. “It’s a model that resonates with people here.”
We, as consumers, are legally compelled to pay people to assume our risk, but there’s no pleasure in the traditional ways of buying insurance. The Guevara platform returns humanity to the process. “We don’t believe that it’s right, how insurance companies have entrenched themselves into a place where they don’t care about the human element,” says product development manager and co-founder JP. The name ‘Guevara’ is a subtle nod to the revolutionary figure, rather than a wholesale endorsement of his political beliefs, but as a platform it recognises the power of a community. It’s assumed people won’t enter needless or fraudulent claims, when this will affect people they know. Amongst all the regulatory compliance are safeguards against unscrupulous exploitation of the system. Ultimately the system’s strength comes from trust.
Providing circumstances don’t change, a premium cap means you never pay more than you did initially. It’s even possible to save up to 80% in successive years. Unless you’ve pooled your money with boy-racers or the pathologically unobservant, this system could significantly reduce your motor insurance outlay. Obviously the system isn’t for everyone. If you’re governed by self-interest or simply a careless driver, there’s little to be gained. If you know, and are willing to trust a small group of like-minded individuals, the benefits could be endless. If the scheme is working smoothly for a group, there’s no reason why it can’t be used to cover other insurance situations.
Although Guevara gives people the ability to understand where their money goes and work together, JP is pragmatic about its immediate obstacles. “The challenge with what we’re doing is being trusted to hold the money and being prudent with it. It’s also hard helping people to trust each other.” Previously advising banks and telecom companies, he left to begin banking and healthcare projects in Kenya. There, 90% of the population have no access to banking or adequate healthcare, many living day-to-day and unable to build up a financial safeguard. In the developing world, many traditional systems encourage everyone to place money into a central fund to benefit those falling behind. Apparently the Western world’s higher standard of living is accompanied by a loss of this community spirit.
Until now, everyone relied on individual relationships with a big insurer, who essentially didn’t care. Surprisingly, similar closed-access insurance systems are standard practice. Large vehicle fleet owners hold money on their own balance sheets to cover claims, only going to outside insurers for extraordinary coverage. Rich, having worked extensively in customer-orientated roles, understands the value of building an emotional connection with their brand and their clients. “People have been buying based on price, and their experience has been terrible.” The economics of big insurers is stacked against the customer experience, instead everything seems to be profit-driven.
Propelled by a loss of faith, our society is reassessing the power of the individual in the marketplace. Many realise whilst their money sits in a bank earning minimal interest it’s not helping anyone, except the big institutions holding it. With careful regulation and technology bringing people together, new financial methodology is aiding those who need to borrow and yielding a larger return for savers.
Che Guevara himself once proclaimed: “The people liberate themselves.” While the enigmatic Marxist now finds himself resigned to countless student posters, the communal ethos behind this platform would have thrilled him. All you need is a desire to work together and dissatisfaction with how big business treats customers. “In terms of outlaws, we genuinely believe the future of how insurance works will be like this,” says JP. “All revolutions have to start with someone who is willing to go outside the system and try to change things.”
Diverting power from big business into the hands of the individuals actually paying the premiums, Guevara is a reflection of society’s shifting economic attitudes. Now there’s a new chapter of change, one where people demand transparency, responsibility and
Words by Stuart Rolt