Unlocking New Revenue Streams: Embedded Insurance for Ecommerce Platforms

Nathan DauSchmidt, Assistant Vice President of Strategy & Innovation, Great American Insurance Group

Nathan DauSchmidt, Assistant Vice President of Strategy & Innovation, Great American Insurance Group

As ecommerce continues to evolve, forwardthinking CFOs are exploring innovative ways to diversify revenue. One such opportunity gaining traction is embedded insurance—a model that seamlessly integrates insurance offerings into the digital purchasing experience.

What is Embedded Insurance?

Embedded insurance refers to the integration of insurance products into a non-insurance consumer moment, such as during the checkout or post-purchase flow. Embedded insurance is seeing a renaissance in ecommerce platforms and SaaS. Rather than redirecting customers to third-party insurers, businesses can offer relevant coverage—such as product protection, travel insurance, or shipping guarantees—at the point of sale. This frictionless experience not only enhances customer satisfaction but also opens a new monetization channel for the platform provider using APIs to an insurance partner.

Meeting Customer Needs

Today’s consumers expect convenience and personalization. Embedded insurance meets both demands by offering timely, relevant coverage options tailored to the product or service being purchased. For example, a customer buying a high-end laptop may be offered accidental damage protection during checkout. When I was the CFO of a home inspection SaaS company, we provided Errors & Omissions coverage to software users on a per-inspection basis, greatly aiding new inspectors who did about a tenth of the inspections of a more seasoned inspector. This proactive approach builds trust and loyalty while reducing post-sale friction and support costs.

A Strategic Revenue Lever

For ecommerce platforms and SaaS providers, embedded insurance represents a high-margin, low-overhead revenue stream. By partnering with insurers or leveraging APIs from insurtech providers, platforms can earn fees without taking on risk. This model is particularly attractive for CFOs seeking scalable, recurring revenue that complements core business operations.

Moreover, embedded insurance can drive higher average order values and conversion rates. Customers are more likely to complete purchases when they feel protected, and optional add-ons like insurance can increase basket size. Over time, data from insurance uptake can also inform product development and pricing strategies.

Implementation Considerations

To capitalize on this opportunity, CFOs should familiarize themselves with insurance financial metrics and then collaborate with product and technology teams to assess integration options and identify the most relevant insurance products for their customer base. Compliance, data privacy, and customer experience must be carefully managed, especially in regulated markets.

Conclusion

Embedded insurance is more than a value-added service—it’s a strategic lever for growth. Embedded insurance offers a compelling blend of customercentricity and financial upside. As digital ecosystems mature, CFOs who help their organizations embrace embedded insurance will be well-positioned to unlock new value and strengthen their competitive edge.