’That was the first barrier that was broken down – the idea that software houses only wanted to deal with big blue-chip companies and well-established brokers,’ says co-founder and managing director 

With the growing gig economy and alterations in forms of car ownership, there is an increasing demand for flexible and short-term insurance across various lines.

Short-term insurance covers a policy holder for a short period of time, but has traditionally been thought of as more costly than standard policies. 

For example, Markerstudy revealed that it would be withdrawing from the short-term market last month (7 February 2024), as it was too “expensive to administer”.

However, one broker that has found the short-term insurance market to be profitable is GoShorty.

Since its inception in June 2020 during the height of Covid-19 Pandemic, GoShorty has worked in partnership with insurance software solutions insurtech CDL to build the brand.

Co-founded by Andy Moody and Simon Jackson, GoShorty spent the first couple of years of its life securing insurer capacity and growing policy sales.

Moody, who is also managing director of GoShorty, told Insurance Times: “Scalability and growth is a massive thing for us. We have very ambitious plans and we’re ahead.”

In the 12 months ended September 2023, Go Shorty tripled its policy count – boosting sales to 300,000, up from 100,000 the previous year. 

This success also helped Go Shorty win the coveted Personal Lines Broker of the Year accolade at the Insurance Times Awards last year December.

For the year ahead, Moody said the it would continue to grow its business and customer base, maintain consistent levels of service and roll that out to a wider audience.

Building success

Despite strong growth in its most recent financial results, success did not always come easy to the startup broker.

Moody explained: “I was faced with a challenge as an entrepreneur – setting up a business and looking for funding.”

On top of this challenge, many insurance software houses at the time were not flexible enough to deal with GoShorty’s niche offering of temporary insurance for cars, vans and learner drivers.

However, Moody said he knew he wanted to work with a well-known software house to avoid future capacity woes, which is why entering a partnership was key.

This also came with challenges as many software houses were “hard to get in front of” for a then-unknown startup.

Referencing its CDL partnership, Moody said: “That was the first barrier that was broken down – the idea that software houses only wanted to deal with big blue-chip companies and well-established brokers.”

Raising awareness

When deciding on a strategy, Moody noted that customers often wanted “something outside of the traditional” and had to educate lots of consumers that were only discovering short-term vehicle insurance for the first time.

He explained: “People in the UK don’t know that short-term vehicle insurance exists – it’s not just about our brand, it’s about the entire product sector and raising awareness.”

GoShorty does not do renewals – instead, customers can simply purchase a single policy again. Its repeat purchase rate is 50%, explained Moody, dubbing these customers “repeaters”.

One key demographic for the startup broker are customers under the age of 25, who are “repeat prolific buyers” of short-term insurance.

Nigel Phillips, chief executive of GoShorty partner CDL noted that short-term insurance is a “needs-based” type of cover, as the policyholder only pays for what they use.

For example, a policyholder might wish to insure a van for two hours every day over the course of a week.

Phillips added that, as other insurers see the benefit of short-term insurance, interest will be fuelled and awareness of where to buy it will grow.

Forefront of technology 

For Phillips, “technology and customer expectations are constantly evolving” and one of CDL’s main business pillars has been “digital simplicity”.

The insurtech strives to be at the forefront of technology, which involves keeping the product fresh and making sure the pricing is keen.

Phillips continued: “Data is another big part of what we do to support GoShorty to continue its growth.”

There was “an abundance and great drive towards improving artificial intelligence (AI) tooling,” Phillips added, which tied in with the move towards AWS cloud hosting services.

“AWS, among other cloud providers, have invested and continue to invest a great deal in tooling to help support AI capability,” Phillips said.

On a global level, he also explained that there had been a great deal of focus in using the cloud to deploy services that could be linked to AI.

On the flipside, the Digital Adoption Report 2023, which surveyed 220 brokers and was published by Insurance Times and Applied Systems, revealed that only 45% of surveyed brokers had invested in IT cloud infrastructure – a marginal rise from the 41% finding in 2022.

Now that GoShorty’s business has doubled in scale, Moody said that the new AWS system can accommodate that growth. 

Moody continued: “The question you have to ask yourself as a digital business owner, is why wouldn’t you make the migration to a cloud-based solution?

“The whole landscape changed very quickly because of the reliability. No software house in the world can offer 100% uptime.”

Despite this, customers expect businesses to run 24/7, putting pressure on teams.

“For a digital business, any kind of interruption is lost money. Uptime is something that is very important to us,” Moody added.