Insurtech company Metromile is gearing up to enter the cryptocurrency arena.
San Francisco-based Metromile, which sells pay-per-mile auto insurance through its digital platform, announced on May 6 that it soon will let policyholders pay their premiums and receive claim payouts in both dollars and bitcoin. Metromile says it’ll be the first insurance company to embrace cryptocurrency in that way.
The company plans to buy $10 million of bitcoin in the second quarter to accommodate acceptance of cryptocurrency, but it hasn’t set a timetable for its bitcoin rollout.
In a news release, the company said it “believes allowing cryptocurrency payments will support its commitment to fairer insurance and promote financial resilience for policyholders as cryptocurrency becomes mainstream and a more significant portion of consumers’ assets.”
Metromile CEO Dan Preston said that adding bitcoin as a payment option will contribute to “fairer insurance for all,” complementing the company’s pay-by-the-mile model and its AI-fueled claims processing. Thus far, the National Association of Insurance Commissioners hasn’t taken a stance on cryptocurrency, and only a handful of insurers have dipped their toes in the crypto-pool.
Metromile’s cryptocurrency move comes as the company embarks on a nationwide expansion to “meet the growing demand for pay-per-mile auto insurance as people reduce their driving, change how they get around and look for new ways to save.”
For now, Metromile operates in eight states: Arizona, California, Illinois, New Jersey, Oregon, Pennsylvania, Virginia and Washington. The company aims to be selling auto insurance nationwide by the end of 2022. At the end of 2020, Metromile had nearly 93,000 policies in force; it posted insurance revenue of $101.3 million last year.
Metromile’s foray into bitcoin comes as the cryptocurrency market heats up. A report from ResearchAndMarkets.com points out that corporate giants like Visa, Mastercard, PayPal, Amazon, Apple and Square are all making cryptocurrency plays.
In a May 4 post, data provider Statista noted that 2021 “is fast turning into the year of the cryptocurrency.”
Citing data from CoinDesk, Statista says the average price for bitcoin rose 113% from Dec. 25-31 last year to April 28-May 4 this year. But among cryptocurrencies, bitcoin actually is a laggard. For the same periods, the price of Litecoin went up 115%; Dash, 198%; Ethereum, 324%; Maker, 760%; and Dogecoin, 7,555%.
Square, a San Francisco-based paytech company, bills itself as the first public company to enable bitcoin transactions. Last year, it racked up $4.57 billion in bitcoin revenue through its Cash App platform, up 785% from 2019. In February, Square bought $170 million in bitcoin as a long-term investment. That followed a $50 million purchase in October.
In a recent filing with the U.S. Securities and Exchange Commission (SEC), Square declared that “cryptocurrency is an instrument of economic empowerment that aligns with our corporate purpose.”
According to The World Financial Review, people’s increasing knowledge of cryptocurrency is making its use more palatable. Last month, the value of the global cryptocurrency market exceeded $2 trillion for the first time.
“As cryptocurrency continues to become more common, it’s going to reach more and more people,” The World Financial Review says. “This leads to an increase in awareness and an overall surge in popularity. More people understand that this is an option now, and many of the questions about what cryptocurrency is are being answered.”