Education among consumers is needed, however, due to the widespread belief that this cover is provided by employers
UK inflation will result in an increase in the potential market size of gig economy insurance, GlobalData has highlighted.
According to GlobalData’s 2022 UK insurance consumer survey, published last week (3 February 2023), 14.5% of consumers were intending to take up a second job last year, with 14% already having done so.
A further 26.6% had considered taking up a second job, but decided against doing so.
Around 90% (89.7%) of all respondents said the cost of living crisis had influenced their decision – 62.8% said it was a direct result of the economic climate, while 28.5% said it was a factor but not the sole reason.
The three most popular second jobs consumers were considering were dog walking (35.8%), delivery services (35.5%) and cleaning on demand (33.3%).
GlobalData surveyed over 4,000 respondents for the research in Q3 2022.
Cover gap
Ben Carey-Evans, senior insurance analyst at GlobalData, said that while consumers experience “spiralling monthly bills”, the growth in people taking up second jobs to “top up income” would “increase the size of the potential market for gig economy insurance”.
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The gig economy refers to a labour market characterised by the prevalence of short-term contracts or freelance work – such as food delivery riders – as opposed to permanent jobs.
Considering gig economy cover in the existing market, Carey-Evans said: ”There is often a grey area between who the insurance responsibility falls on – the employee or employer. But insurers have started to offer cheap and flexible policies, often via apps, directly to gig-economy workers to provide coverage for their key liabilities.”
GlobalData’s consumer survey revealed that 14.2% of respondents assumed gig economy insurance would be provided by their employer, which it said was holding back policy growth.
Carey-Evans therefore added that “raising awareness about how important basic policies can be and making policies as cheap and easy to purchase should help increase their penetration.”
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