Micromobility is an industry focused on evolving transportation — primarily, the first and last mile between your origin or destination and the primary public transportation hub. Whether you are offering bikes or scooters, dockless or docked, the goal is to provide an accessible, on-demand transportation alternative.
Micromobility has driven unprecedented investor interest in recent years, generating a number of market leaders. Automakers are also taking notice; consider the Ford-backed scooter-sharing platform, Spin. A small crew can deploy a fleet of GPS-enabled scooters or bikes in a mere few hours, requiring minimal maintenance and no infrastructure changes.
The industry is rapidly evolving, with many new entrants both at home and abroad. Market share is the name of the game, and often the key barrier to rapid expansion are insurance requirements at the city and state level.
From the early days in Santa Monica, availability has expanded nationwide with many cities onboarding this mode of transportation. Companies like Bird and Lime have seen massive growth in the past two years, and many new entrant are launching in cities this year.
Since the introduction of the first domestic dockless bikeshare system in Seattle in the summer of 2017, cities and universities have quickly adopted and introduced programs. Users left their bike locks at home as 2018 saw 1.6K bikeshare systems worldwide.
Launching a bike sharing or e-scooter fleet in a new city can be confusing, and having the right insurance can make or break your application with a city. We’ve mapped out the three key steps to ensure you have the right coverage and are positioned for rapid growth.
From San Francisco to Ft. Lauderdale, Chicago to Austin, cities require differing levels of coverage to operate within city limits. Founder Shield has amassed knowledge of the insurance requirements of all major U.S. cities and will review your Permit Application to ensure all areas are met. If you’re seeking to rapidly expand in the U.S. — no problem! We know exactly what program structure you need to effectively roll out.
Save the back and forth, countless email chains, we know exactly what information is required to secure effective coverage. Only a few insurance carriers will touch the micromobility space, and we work closely with all of them! Our partners have the capability to provide a true worldwide solution — a critical element as you expand in the U.S. and abroad.
Moving into a new market? Expanding globally? We assist in the reporting to ensure your program always reflects existing operations and offer true global capabilities. We partner with leading mobility and on-demand insurance carriers that craft custom policies designed to scale as you do. You focus on expansion, we’ll make sure insurance doesn’t become a barrier to growth.
What are the minimum insurance requirements?
It will depend on what city you plan to operate in, but typically you will need to meet the below requirements (with the city being named as an additional insured):
$1M per occurrence, $2M aggregate
$1M per occurrence
$5M per occurrence
Cities where these requirements apply
- San Francisco
- Los Angeles
Recommended policies for Micromobility
These coverages form the foundation of any risk management program for Micromobility companies:
The potential of a customer being injured while operating a scooter or bike is the biggest risk facing the micromobility space. In addition to the need to insure yourself against this risk, it’s crucial to know that this coverage will be required in at least $1M per occurrence and $2M in the aggregate in every city you wish to operate. Most cities will actually require higher.
Excess General Liability
Again, the potential of a costumer being injured while operating a device is the largest exposure the micromobility space faces. Due to the potential catastrophic injuries that could be suffered, and the ensuing lawsuit, the standard $1M per occurrence and $2M in the aggregate, may not be enough to cover defense costs and damages. Additionally, most of the bigger markets you will look to move too will require anywhere from $3M to $10M in excess coverage.
When employees sustain work-related injuries, employers are typically responsible for their medical costs and lost wages. This policy covers these expenses, protecting employees while simultaneously keeping e-commerce companies running smoothly.
Transporting scooters or bikes to and from the warehouse for deployment and maintenance typically requires the use of automobiles. This means that there is an exposure of drivers out on the road driving on your company’s behalf. Should there be an accident resulting in third party bodily injury or property damage, you would need to rely on this type of coverage for the damages.
With the need for maintenance and rolling out more scooters or bikes at any given location, there will be a need to store additional units at a location in the cities you operate. The property policy will help you recoup the value of this inventory (as well as your office property) should a damaging event (i.e., a fire) occur at one of these locations.
Types of Micromobility Companies that need insurance
- Fleet Services
- Personal Micromobility
- Micromobility Platforms
- Supply Chain & Manufacturers
Micromobility Frequently Asked Questions
The cost of insurance for micromobility companies will depend on several things, including the company’s size and development stage. Other factors include:
- Exposures: risks being insured
- Company practices: views on safety, compliance, and risk management
- Program structure: the amount of deductible and willingness for a company to assume more risk
- Claims history: the type and amount of past claims against the company