When it comes to newer brands that consumers have embraced in 2015, companies like Uber, Fitbit and Airbnb dominate the conversation. Consumers crave services that are flashy or new, different from other alternatives and paired with an easy-to-understand value proposition. Insurance companies historically haven’t embodied this nimble, innovative or customer-first expectation that is becoming the norm across categories. As the industry lags behind, so does consumers’ trust. In fact, Mintel’s The Role of Trust in Financial Services US 2015 report shows only 10% of adults surveyed found insurance companies very trusting. Furthermore, Millennials’ level of engagement with financial services brands is a bit discouraging: 41% of US Millennials say they have no interest in receiving financial advice. Evidence that, while insurance products inherently provide security and protection that consumers crave, the gap between what insurance provides and what insurance companies are perceived to be continues to widen. It used to be that a brand name held a significant amount of clout. Today only 3 in 10 consumers prefer to know that insurance policies are backed by a major brand name, swinging the door wide open for new players to break the mold – just as Airbnb and Uber have done for their respective industries. As we look ahead to 2016, the answer may lay in the hands of venture capitalists and technology companies who are developing the antidote to the insurance company of yesterday. Reinventing the industry The rallying call for venture capitalists and technology companies is everything that consumers feel the industry is lacking today. What if the industry could start over? How would insurance look if it was explained in language devoid of industry terms? And what if the giant corporate structure faded away in favor of technology platforms and peer groups that provide accountability? These are not pie-in-the-sky ideas that might be realized 10 or 20 years down the road. They are actual questions being addressed today by industry stakeholders. Recognizing the need for change, MassMutual’s in-house startup Haven Life aims to be “life insurance, if life insurance could start over.” Companies like Oscar Health have simplified the way health insurance is explained, using humor, but without complex industry jargon. The proposition is so intriguing to investors that after only a few years the company is now valued at $1.75 billion, including recent funding from Google totaling $32 million. The list goes on and on as technology executives and entrepreneurs are embracing the industry in hopes of reaching consumers in a new way. These outsiders recognize that change is needed in an industry that has “most Americans view[ing] insurance as a necessary evil than a social good,” according to Daniel Schreiber, co-founder of the new company Lemonade. Lemonade brings the sharing economy to insurance Schreiber’s company received $13 million in seed funding from Sequoia Capital in December 2015. Lemonade hopes to turn the model of what an insurance company looks like upside down. The company has adopted a peer-to-peer structure, where groups of consumers could receive money back or lower premiums if their group does not submit a claim during a policy year. This is not dissimilar to Friendsurance in Germany and Guevara in the UK. Friendsurance, started in 2010, is available on property, private liability and legal expense insurance. Guevara, founded in 2014, is available on auto policies. Both offer customers the ability to pay premiums into a pool of money, which is then used to pay out small claims. If the money is not used, customers either get a portion of the money back or the incentive that subsequent premiums might be lower. While the concept may be groundbreaking to consumers, the notion of pooling people together to balance out and reduce risks is the very origin of insurance. By creating a sense of culpability among fellow policyholders, the concept of peer-to-peer insurance pulls back the curtain on how premiums can change and how claims can be paid out in hopes of creating a more engaged, responsive customer. If consumers embrace the idea, the transparency this new model offers has the ability to make the consumer more trusting and in turn a more likely advocate of the indispensable need for insurance. Stephanie Roy is the Director of Insights, Insurance at Mintel, focusing on all insurance sectors for Mintel Comperemedia. She is responsible for providing internal and external stakeholders with insights and analysis on trends in the Life, Health and P&C insurance industries. You might also be interested in: Insurance Marketing Trends 2016: How’d we do?