The gig economy is reshaping the nature of work and exposing a major gap in how risk is insured. Traditional insurance products, built for steady payrolls and nine to five predictability, cannot address the volatility and diversity of income, hours, and roles that define freelance and platform-driven work. As millions shift toward informal and flexible employment, the insurance industry must respond with technology-driven solutions that deliver both flexibility and security.

The core challenge: insuring the unpredictable

Gig workers, from rideshare drivers to freelance creatives, often fall outside the reach of employer-provided benefits and risk pools. The gig economy is expected to reach over  1.5 billion workers globally in 2025, with over half lacking adequate insurance because of inconsistent income and irregular employment patterns.

Informal, inconsistent income leads to irregular cash flows that complicate underwriting and payment schedules. Irregular work patterns and frequent job switching make risk difficult to model with legacy approaches. Insurance is typically not transferrable between platforms or jobs, leaving workers exposed during transitions. As a result, more than 50 percent of gig workers are uninsured or underinsured, facing financial vulnerability in case of accident, illness, or liability claims.

The solution set: usage-based, on-demand, and hyperpersonalized insurance

Technology is rapidly closing these gaps. Insurtech startups and forward-looking incumbents are leveraging data, AI, and real-time analytics to deliver coverage that adapts to the new world of work. According to Zion Market Research, the global gig economy insurance products market is expected to reach $1,500 billion by 2032, growing at a CAGR of 18% from 2024 to 2032, driven by the surge in freelancers, the widespread adoption of digital platforms, and increasing business awareness around the need for tailored insurance for gig workers.

Usage-based and on-demand models

Usage-based insurance (UBI) connects insurance pricing to real-world activity such as miles driven, hours worked, or transactions completed, enabling carriers to match premiums to actual risk exposure. For gig workers, UBI reduces costs and offers fair, transparent pricing based on actual work activity. Gig workers increasingly access insurance by the hour, day, or project. Startups like Slice Insurance and Bunker enable users to activate coverage only when needed, lowering barriers and aligning with freelancer cash flows. For example, Slice’s platform enables customers to buy insurance for defined timeframes like a single rideshare shift or food delivery gig, giving them the protection they need without requiring ongoing or long-term policies.

Micro-duration and embedded insurance are further innovations. Platforms integrate insurance directly into gig apps, activating or deactivating coverage as workers log in or out. This ensures continuous and cost-effective protection. For example, Cover Genius provides embedded insurance solutions for gig platforms, integrating coverage directly into apps like Uber and Ola, with policies activating during work sessions. 

Hyperpersonalization powered by AI

The most transformative advances are emerging from AI-driven platforms. By analyzing vast amounts of behavioral, transactional, and even social data, AI enables insurers to predict individual patterns, build granular risk profiles, and deliver tailored recommendations. Machine learning models forecast gig workers’ income variability, work schedules, and risk exposures in real time, synthesizing diverse data streams such as location, job history, and digital behavior.

Eighty-nine percent of US policyholders including a large proportion of gig workers are willing to share personal data for more personalized offerings. Personalization delivers measurable business value, with insurance carriers seeing up to 15 percent revenue lift and 20 percent higher retention when policies are tailored using behavioral analytics.

Case studies: Insurtech startups at the frontier

Top-tier insurance companies are stepping up with their own initiatives and partnerships to address the evolving risks faced by gig workers.

• AXA Philippines has collaborated with Grab and MOVE IT to provide free life insurance coverage of up to ₱1 million (approximately $17,000) for top-performing driver-partners. This initiative aims to enhance social protection for gig workers in the Philippines.

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• Munich Re's Digital Partners collaborated with Buckle to launch a rideshare insurance policy that combines personal and commercial coverages, catering to the unique needs of gig economy drivers.

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Several startups are setting the standard for gig economy insurance through technology-first strategies. GigEasy focuses on portable, hyperpersonalized benefits such as income protection, health, and liability, adapted for platform and freelance workers. Next Insurance offers tailored coverage for small businesses and gig professionals with instant underwriting, monthly payments, and flexible upgrades. Zego pioneers real-time, usage-based insurance for rideshare and delivery drivers, directly integrating with gig platforms to adjust premiums based on actual driving. Thimble, Bunker, and Insify enable freelancers and SMEs to purchase micro-duration, on-demand liability and business insurance, fully digital with instant activation and automated compliance.

These models are more accessible. They are fundamentally changing how risk is assessed, priced, and managed for the gig workforce.

The future: platform integration and new risk intelligence

The insurance stack for the gig economy will be defined by seamless integration with platforms, where coverage becomes an invisible, always-on layer triggered automatically as workers log in to perform tasks. AI and behavioral analytics will enable continuous risk assessment, updating risk profiles in real time to reflect changes in income, activity, and market trends. Beyond core health or auto, gig insurance will expand to include mental health, upskilling, income smoothing, and financial planning tools. As regulators increase scrutiny and workers demand more security, these technology-driven models will become table stakes for both platforms and insurers.

How SOSA helps leaders drive insurance innovation

SOSA helps insurers identify and implement high-impact technologies that align with business goals and the realities of the gig economy. Our team scouts and validates InsurTech solutions for usage-based, on-demand, and AI-powered risk models. We work with partners to pilot and launch tailored insurance offerings that improve access, retention, and long-term value for both workers and platforms. To learn how to build your next insurance product or strategic partnership, connect with SOSA’s innovation experts.

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Ready to lead in gig economy insurance? Connect with our innovation team to explore how AI, behavioral analytics, and usage-based models can help you launch hyperpersonalized, technology-driven products for today’s evolving workforce.