What is white label insurance?

Some insurers design products as a service for partner companies: “insurance-as-a-service”. When it comes to the distribution and administration of these products, they do not label the products as their own – thus the “white label”. Instead, partner companies market these policies under their own names. The partner companies are the ones largely responsible for communicating with customers – often from the conclusion of the contract and invoicing of premiums to the processing of reported insurance claims.

Consequently, from the customers’ perspective, the question of who exactly is their insurer is sometimes not entirely clear. In fact, it is not the partner company they are insured with, but an insurer working in the background, called the “risk carrier”. The risk carrier assumes the financial risk associated with the coverage of damage or losses under the policy. The actual insurer is stated in the General Insurance Policy Conditions.

What types of policies are involved?

White label policies are usually products for which providers can determine prices based on just a few details provided by the customer. Examples include pet insurance, bicycle insurance, home contents insurance and other voluntary property insurance policies. Types of insurance less common among white label products include compulsory insurance such as motor vehicle liability insurance, voluntary supplementary packages for motor vehicle insurance such as third-party driver cover, or supplementary health insurance.

As for insurable risks and situations or losses that are not covered, white label products often differ little from traditional insurance policies. What sets them apart is primarily the largely digital distribution and the new relationship structure of the parties involved.

There are traditional insurers who use the white label model to make their products available through various partners and thus make them accessible to a broader target group. However, the insurers using white labelling are also often “insurtechs” – young, technology-oriented companies that have obtained authorisation from BaFin to conduct insurance business.

The companies involved in distribution, i.e. the partner companies, also vary greatly – these are often young companies from the start-up scene, for example, that do not require authorisation of their own for conducting insurance business.

These partner companies generally act as insurance intermediaries that pass on products to their customers.

Why it matters whether it is white labelling

In the case of white label products, you are dealing with two different companies. Be careful to obtain detailed information about both partners and what each of them is responsible for. When you do, bear in mind the following:

• It can be difficult to distinguish between the responsibilities of the partner company and those of the insurer. The same applies to complaints. It therefore makes sense to always contact both of the contracting parties, i.e. the insurer as well as the partner company.
• The quality of the service and of the response when you need to claim on the policy will depend on both companies.
• If an insured event occurs, solely the insurer – as the risk carrier – is responsible.

 Where white labelling must be disclosed

There are often indications on websites or apps that there is an insurer behind the offer. However, this information is often only to be found in footnotes, the small print, the legal notice or, for example, the “Frequently asked questions” (FAQ) section.

To be absolutely sure, check one of the following three documents for the name of the insurer carrying the risk:

• the General Insurance Policy Conditions,
• the insurance application and
• the insurance certificate.

 If the risk carrier is not the same entity as the company whose brand is used to market the policy, you are dealing with a white label product.

What else you should bear in mind

Comparing can be worthwhile
Compare insurance benefits, restrictions with regard to risk and the price-performance ratio of different products – both traditional and white label. As you compare, also pay attention to special features (such as the availability of additional services) that are important to you.

Check conditions and exclusions
Regardless of white labelling: when comparing insurance products, pay attention not only to the price, but also to the conditions and exclusions relating to the insurance cover, which can vary greatly depending on the insurance policy. In the case of supplementary health insurance, for example, there may be waiting periods to be observed before you can claim certain benefits. Surgical procedures might not be covered by pet health insurance. If you carefully check the insurance terms and conditions, you will be able to avoid unpleasant surprises in the event of an insurance claim.

Advice also available for online business
The rules that apply to offline distribution generally also apply to digital application processes. If you would like to receive advice, do not hesitate to contact customer service. If you are unsure, you can also ask the customer service representative who the insurer is.

Keep in mind the need to protect your own personal data
Since there are at least two companies involved when it comes to white label products, their systems must be linked to enable them to exchange data. This may increase the risk of security gaps and data breaches (personal and financial data). Make sure you also know the intended purpose for the use of your data. If your data is to be used for purposes going beyond those of the insurance relationship, you should give your consent only if you actually agree to such use.