January 23, 2026
Insurance has shifted from being a standalone product to becoming an integrated part of everyday transactions. Instead of purchasing separate policies, coverage is now embedded into payment systems, loan platforms, and billing processes. Here’s what you need to know:
Embedded insurance connects payment systems and insurance providers seamlessly through APIs and orchestration layers. When a customer makes a transaction - whether it’s purchasing a car, booking a flight, or subscribing to a service - the system instantly generates an insurance quote using transaction data. No extra forms or manual input are needed.
For example, by 2025, Chubb is using Stripe Connect to offer driver-income protection directly within the Grab app in Southeast Asia. This setup handles complex fund flows automatically, collecting premiums from drivers and routing them to underwriters without any manual intervention [3].
An orchestration layer takes care of quoting, policy issuance, and payment processing [4]. Insurers benefit from flexible product engines, which let them define product types and adjust policy terms on the fly - no new coding required [5]. This means insurance coverage can adapt instantly to the specifics of a transaction, whether it’s a low-cost rental or a high-value car purchase. The result? Smooth integration, dynamic pricing, and compliance baked right into the process.
Real-time data has revolutionized how premiums are calculated. Instead of relying on static demographic profiles, modern systems use advanced software to process transaction data instantly. This allows for a personalized premium to be generated at the point of sale, reflecting the unique risks of each transaction [5].
The automation doesn’t stop at premium collection. In 2024, UK-based insurtech Cuvva adopted Stripe to automate the allocation of incoming premium payments. The system splits each payment, sending commissions to Cuvva and the remaining premium to one of three underwriting partners - completely removing the need for manual reconciliation [6].
Compliance is seamlessly integrated into these platforms. APIs now include essential regulatory features like Anti-Money Laundering (AML) checks, Know Your Customer (KYC) verification, and PCI DSS standards [5]. Automated tools for consent management and audit trails further ensure data privacy and regulatory adherence. This "compliance by design" approach ensures that as digital payments evolve, regulatory requirements are met without slowing down the process.
Modern billing and loan platforms are transforming the way insurance is offered by embedding it directly into their systems. This seamless integration ensures that insurance becomes a natural part of the transaction process, making it more convenient for users and more efficient for businesses.
Billing platforms now incorporate insurance into invoices and subscription payments through APIs and low-code tools. Instead of treating insurance as a separate product, it’s woven into the recurring payment process. For instance, when customers subscribe to a service or receive an invoice, the platform uses existing transaction data to instantly generate a personalized insurance quote.
Take Stripe Billing as an example. It automates premium collection and manages reconciliation and settlement without requiring manual intervention. Insurance premiums are processed alongside regular subscription fees through automated recurring payments. Additionally, businesses can use low-code tools to configure policy terms and benefits, ensuring they can update coverage options when needed [3][5].
This approach has proven to be highly effective. Embedded insurance achieves conversion rates of 40% to 60%, far exceeding the 5% to 15% seen in traditional models. It also significantly lowers customer acquisition costs, which range from just $2–$8 compared to $50–$200+ for agent-led distribution [2]. The key to this success lies in reducing friction - customers are presented with relevant coverage options at checkout, and prefilled information allows them to secure a policy in less than 30 seconds [2].
This streamlined model in billing systems sets the stage for similar innovations in loan servicing platforms.
Loan platforms are also embedding insurance into the borrowing process, offering protection as part of the transaction. When someone applies for an auto loan or finances a purchase, the platform leverages real-time data to assess risk and provide instant insurance quotes during the application process [5][7].
A standout example is Tesla Insurance, which launched in 2019. Using real-time driving behavior data from vehicle sensors, Tesla dynamically adjusts premiums based on individual driving performance [1]. Similarly, Ford’s Ford Insure, developed in partnership with Nationwide Insurance, integrates personalized rates into the vehicle purchase process by analyzing connectivity and usage data [1].
As Alex Timm, CEO of Root Insurance, explains:
"Talking to consumers at the time when they really need insurance - like when they're purchasing a vehicle - is a lot better customer experience than being bombarded with advertisements to try to get somebody to a website [that describes] a product they're not very excited about in the first place."
These integrations not only provide borrowers with tailored coverage but also create new revenue opportunities for lenders, enhancing the overall value of the loan process [7].
Walnut Insurance is making waves in the embedded insurance space with its API-driven platform that seamlessly weaves insurance coverage into everyday business transactions. By using a single API integration, businesses can launch a variety of insurance products in just days instead of years [9]. The platform connects companies to over 14 insurance carriers, offering a wide range of products - personal lines like home, auto, and life insurance; commercial coverage such as errors and omissions and small business protection; and group benefits like life, AD&D, and critical illness coverage. This setup allows businesses to offer tailored insurance options to their customers without needing in-house insurance expertise [9].
Walnut provides three flexible integration solutions to meet the technical capabilities of different businesses:
Take Neo Financial, for example. As one of Canada’s fastest-growing neo-banks with over 1 million customers, Neo partnered with Walnut to integrate insurance products like extended warranty, rental insurance, purchase protection, and premium plan features (e.g., mobile phone protection and life insurance) into its digital banking platform. Andrew Chau, Co-founder & CEO of Neo Financial, shared:
"We're excited to partner with Walnut, bringing insurance into the digital age and creating greater access to protection for all Canadians. We've been impressed with how their infrastructure has been able to support us in growing our product offering."
These integration options are designed to fit seamlessly into Walnut’s platform, ensuring smooth implementation and compliance.
Walnut’s platform doesn’t just stop at integration - it’s packed with features that simplify the insurance process. The platform handles regulatory compliance across multiple jurisdictions, removing the hassle of navigating state-by-state licensing requirements [9]. Its multi-channel broker support ensures customers receive help throughout their insurance journey. Real-time quote and bind functionality provides instant, personalized pricing and coverage, while businesses can tweak coverage options without needing extensive technical resources.
Walnut also takes care of the financial side. Its intuitive dashboards track customer enrollment, protection status, and revenue splits among brokers, enterprise partners, and insurers. These tools make it easy for businesses to monitor performance and ensure smooth operations. Impressively, companies using Walnut's infrastructure have seen customer lifetime value more than double [9][10].
These examples highlight how embedded insurance is reshaping customer experiences across different industries.
Auto lending and purchases have become smoother thanks to embedded insurance solutions. For instance, Tesla introduced an app-based insurance model in 2019 that calculates premiums using real-time driving data collected by vehicle sensors, rather than relying on traditional demographic factors [1]. Similarly, Root Insurance's collaboration with Carvana showcases how policies can be seamlessly integrated and finalized during the car-buying process [1].
Travel booking platforms have turned trip protection into an effortless part of the booking experience. JetBlue, for example, offers Allianz insurance directly within its platform, enabling customers to easily add coverage for trip cancellations, baggage issues, or medical emergencies while booking flights [13]. Skyscanner has also partnered with Cover Genius to provide tailored travel insurance options as part of its booking flow [12]. Sho Sawada, Marketing General Manager at Mysurance, emphasized the convenience of this approach:
"Embedded insurance eliminates the hassle. Travelers select and tailor insurance while booking flights and accommodations"
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This streamlined integration underscores the growing trend toward embedding insurance into the travel industry.
Lending platforms are also leveraging embedded insurance to enhance both customer experience and operational efficiency. Citizens Bank, for example, bundles installment loans with Apple iPhone purchases, expanding consumer lending opportunities through embedded finance [8]. Toast Capital offers merchant cash advances to restaurants, using card receivables data to address short-term liquidity needs [8]. These platforms utilize real-time transaction data through APIs, allowing them to provide tailored coverage exactly when customers need it [11].
The impact of these models is striking: embedded insurance achieves conversion rates of 40–60%, compared to just 5–15% for traditional insurance approaches. Additionally, the time required to finalize a policy has dropped from days or weeks to less than 30 seconds. Customer acquisition costs have also plummeted, falling from $50–$200+ in traditional models to just $2–$8 with embedded insurance [2].
The role of insurance is evolving, transforming into a key part of financial infrastructure through embedded insurance. By weaving coverage directly into transactions, businesses are eliminating the need for customers to deal with separate apps, confusing industry jargon, or disjointed experiences. Instead, insurance is becoming an invisible yet essential feature, seamlessly integrated into financial interactions and fostering trust.
This shift is significant. A striking 81% of financial executives now see embedded insurance as a "must-have" rather than just a bonus feature [16]. When companies incorporate protection into payment systems, billing platforms, or loan servicing tools, they’re not merely offering insurance - they’re building trust and creating a reliable financial ecosystem. In fact, 74% of banking and fintech executives report that embedded insurance strengthens customer trust [16].
But the benefits don’t stop there. Embedding insurance into these systems also improves customer retention. When protection is part of the same platform as payments and services, customers are less likely to leave. At the same time, businesses unlock new revenue streams by offering a more cohesive and convenient experience [16]. As Ty Clark, an expert in embedded insurance, explains:
"Embedded insurance is more than a trend; it's the future of how protection will be distributed. It's moving from a product that is sold to a feature that is simply part of a better customer experience"
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For companies, this approach isn’t just about convenience - it’s a strategic move to stand out in competitive markets, reduce churn, and drive revenue. The numbers back this up: the global embedded insurance market is expected to hit $700 billion by 2030 [15][1] and could grow to represent 15% of the global insurance market by 2033, reaching approximately $1.1 trillion [15]. Businesses that treat insurance as a core part of their infrastructure are setting themselves up to capture this growth while delivering the seamless experiences today’s customers demand.
Embedded insurance makes life easier for customers by weaving protection directly into the payment process. Forget about extra sales steps or complicated sign-ups - everything happens in one smooth transaction. This approach cuts down on hassle and speeds things up, allowing businesses to bring customers on board more efficiently and at a lower cost.
With API-driven checkouts, companies can simplify their workflows, reduce onboarding costs, and launch services more quickly. The result? A better experience for customers and improved operational efficiency for businesses.
APIs are the driving force behind integrating insurance into payment systems. They enable payment platforms to instantly communicate with insurance services, streamlining tasks like real-time quotes, policy issuance, underwriting, claims management, and compliance.
By linking these systems, APIs make it possible to weave insurance coverage directly into the transaction process. This creates a hassle-free experience for businesses and customers alike - removing the need for separate purchases, reducing complexity, and making insurance a seamless part of everyday financial transactions.
Embedded insurance makes getting coverage easy by weaving it directly into the purchase process. No need for separate forms or additional steps - coverage is automatically included at checkout, offering instant protection right when you need it. This approach not only saves time but also provides a more tailored and efficient experience.
By eliminating the hassle of standalone insurance purchases, embedded insurance ensures you're covered effortlessly - whether you're booking a vacation, paying your rent, or securing a loan. It's a straightforward way to integrate protection into everyday financial decisions.