Grab and AXA answer one pain point: Insurance!
By Benjamin Cher May 12, 2016
- The two introduce usage-based insurance for private-hire car drivers
- Aimed at converting more part-time drivers to alleviate peak period demand
GRAB and AXA Insurance Singapore have launched a new usage-based commercial insurance package for private-hire car drivers on the Grab platform.
The AXA Pay-As-You-Grab (PAYG) policy will allow drivers to pay 70% of the base premium of commercial auto insurance, while charging six Singaporean cents per kilometre when making a Grab ride. [S$1 = US$0.73]
This insurance is on top of the free group personal accident insurance (PAI) that Grab is providing for its GrabCar and GrabBike drivers.
“I’ll like to take this opportunity to make it clear, this insurance (PAI) covers all drivers and all passengers who ride on Grab – it doesn’t matter if the driver rents the car or owns the car, it’s covered and it’s free,” said Grab Singapore head Lim Kell Jay (pic above).
“Pay-As-You-Grab helps our drivers reduce their costs further without compromising on safety in any way,” he told a media briefing announcing the new policy on May 11.
The new policy is capped at the same premium a driver would have to pay for a full commercial auto insurance policy. The premium however is still calculated on such factors as driver profile and behaviour, and car brand and model.
The new policy does not prohibit drivers from driving for other platforms, but accidents sustained while driving for Grab will see a lower deductible of S$2,000, while driving for other platforms will have a deductible of S$5,000.
Rationale and plans
AXA PAYG is aimed at lowering the cost for part-time private-hire drivers, as Grab currently sees 40% of its drivers driving fewer than 10 hours and averaging 15 trips a week, according to Lim.
“We’re hoping to get more drivers on the platform, because while we have taken many steps in the right direction in solving the transport issue, there are still gaps during peak hours and when it rains,” he said.
“We’re hoping that with PAYG, there will be more drivers coming on board,” he added.
Grab plans to take the new insurance scheme to the other five markets AXA is currently operating in, according to Lim.
“We don’t have a specific timeline, but AXA operates in five out of the six markets we operate in, and we do see value in rolling it out in other countries,” he said.
These five markets are Indonesia, Malaysia, the Philippines, Singapore and Thailand, with the odd one out being Vietnam.
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