The InsurTech announced the acquisition Wednesday (March 15), saying it aligned with its growth strategy, which also includes its recent purchase of refund protection company Booking Protect.
“Data shows that adding protection within the checkout experience increases purchase conversion rates 8%, but 58% of customers were not offered warranties for their most recent purchase,” Cover Genius CEO Angus McDonald said in a news release.
He added that gap has been caused by traditional insurers whose legacy systems have left them unable to meet the demands of small and midsized retailers.
Recent research by PYMNTS backs up McDonald’s point about the importance of a well-crafted checkout experience.
“Reducing friction in shoppers’ online experiences may be the most important goal for eCommerce retailers and marketplaces,” we wrote last month. “This aim is especially critical when it comes to the all-important checkout phase.”
Past PYMNTS’ research has found that 55% of consumers are willing to give up on a purchase in the middle of checkout if the process is painful enough.
Friction during an eCommerce shopping experience might include things like a lack of payment choice, incorrect or unavailable inventory status and free shipping minimums. Additional findings indicate that friction-free checkout can increase the likelihood of customer loyalty.
PYMNTS has also conducted research — in partnership with Cover Genius — showing that embedded insurance offerings meet consumers’ desire for more direct and seamless ways of get insurance coverage.
For example, 45% of consumers said they would be “very” or “extremely” interested in offers from their banks for specific types of coverage based on their bank transaction data, according to the report “Embedded Insurance Report: Leveraging Transaction Data to Expand Coverage in a Digital-First Market.”
Cover Genius purchased Booking Protect in the summer of 2022 for an undisclosed amount.
As PYMNTS noted at the time, the deal allowed the company to expand its footprint in the ticketing and live entertainment space with embedded protection for ticket sellers, platforms and live event companies.
The company also raised $70 million Series D funding round to expand its insurance distribution platform, XCover.