Friendsurance is a German peer-to-peer insurance company that lets customers connect online to create their own insurance pool. Small claims are then paid out of this pool – if the amount claimed doesn't exceed the amount in the pool, then the spare money is returned to customers.
Customers never pay more than their original premiums, and larger claims are covered by traditional insurance. In January 2014, 94% of customers received cashback on their premium, and the company receives on average 40% less damage claims than conventional insurers.
Earlier this year the company received new investment from Hong Kong-based company Horizons Ventures and Australian venture capital firm VantageFund. The total amount was undisclosed, but according to a report from TechCrunch, the amount could total "millions of dollars".
Peer-to-peer business models are proving popular among cash-strapped millennials. In January, US telecoms company Sprint launched its Framily Plan with the tagline "You don't have to be family to be family". The service allows customers to add up to 10 phone lines to one account, and bill each person separately. For more on this trend, see Next-Gen Kin, part of our latest Macro Trend, Modern Family.