Kingfisher pair team up to launch motor insurer with net-zero focus

Underwritten by First Underwriting and KGM, today sees the launch of its first product that offers customers free carbon emissions offsetting for short term cover, available to be taken out for any amount of time between 60 minutes and 28 days.

The product is designed to cater for the growing number of drivers who don’t own a vehicle, either due to cost and/or environmental concerns, and need a choice of cover options for shorter periods.

Co-founder and CEO Andy James told Post: “The role of the private car in the UK is changing, driven by financial pressure, environmental concerns, and homeworking. Also, the Financial Conduct Authority is looking from a sustainability agenda at wanting to be able to get financial services providers to help end consumers to become more sustainable.

“We’re going to see what we saw, during Covid. There was a significant uptake in temporal car insurance policies, and I think that as the cost of living crisis will mean we see the same again.”

How it works

Zixty requires customers to download an app which, through data enrichment and technology provided by insurtech Inzura, finds out the emissions credentials of the vehicle, enabling it to provide a quote to the customer.

The app would then monitor the customer’s driving behaviour through the phone, as James explains.

“Data captured from the telephone will allow the customer to be able to have their journeys monitored,” he said. “We will look at their driving behaviour, so speed, acceleration, braking, all the normal sort of telematics things that you get. But that then enables us to be able to calculate how much carbon they use as part of their footprint on their journey.”

The app would then work out an average score for that driver and reward them for economical and safe driving by offering to offset the carbon emissions free of charge for up to 100 miles per day.

James, who was previously UK CEO of First Central said: “When it gets to the end of the policy, the app will then sum all of those trips up, and we will offset on an average performance. So, if you’ve driven really well, we’ve got a really good score, and you will get the full 100 miles per day.”

Carbon neutral

With 15 staff working in a hybrid environment, but with an office based on London, it is a challenge for the team to be able to offset the emissions as they as a business want to be carbon neutral.

James explained that the company is working with various business and tech providers to as a business be more environmentally conscious.

“We have got Green Mark accreditation; we’ve gone through all of that to make sure that we have the right approaches.

“We’re also working with an organisation called the Gilky. And what they do is they allow us as individuals to work out what our carbon footprint is, our own household levels and then effectively we sum those up to the organisation so that we can then have leader boards within the organisation to see who’s doing best. But we are by no means eco warriors.”

For James himself, he realises that he has areas he needs to improve on the carbon neutrality front, but has admitted that this venture has made him think more about changes he could make.

“I’ll freely admit I drive a diesel SUV. I know I need to change to an electric vehicle, but for me there aren’t that many out there that. But I am actually carbon neutral.”

Zixty is also working with Eden Reforestation to plant a tree for every policy it sells, but James explained how it takes that proposition one step further for the customer.

He said: “We then calculate the emissions that have been emitted by the policyholder, we translate that into, how many trees need to be planted. We’re working with Eden Reforestation, they’re the ones that we then pay the money to, and they go and plant trees around the world.”

Business plans

Currently, the brand has one product on offer, the short term cover service, but James explained that in the near future, additional products will be introduced.

“The main one we want to launch for the middle of next year is going to be pay per mile insurance. That lends itself quite well to the business ideas. If you drive less then great, and that’s environmentally responsible, that implies that you will do well, then we will simply look to offset those customers. But that’s a next year product.”

As for the current product, short term, despite strong competition from established market providers, James is confident of being able to acquire some encouraging market share.

“The short term market is about £150m GWP a year. We want within probably three years to get to a position where we have around 10% of that market. That’s the aim that we’re looking at putting in place.”

For the time being, James said the business will focus on reaching customers directly, but says that the future may present opportunities for other routes.

“The main area of focus is going to carry on being direct. We’re looking at potential affinity and affiliate opportunities, and I’m hoping to have some conversations with aggregators about whether there’s potential for us to go on there.”

So how is Zixty going to make it a success in a congested market, that has seen a lot of new player trying to take a slice of the market share?

“Distribution strategy is key,” James said. “We’re working on what that’s going to be how that’s gonna work. And one of the things that we are looking at and we did some research with fewer customers, and actually there was a market that was out there for people saying that if there was something that could provide the ability to offset the miles that have been driven in quotes, they will take that into consideration.”

James concluded by saying that while he feels there is a market for the product, he doesn’t not want

“There is a market for offsetting. But we are not eco-warriors. We want to encourage economical, safe driving, and appeal to anyone who has an environmental conscious.”