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Pay-as-you-go insurance provider targeting gig workers has raised £1.225m

Pay-as-you-go insurance startup, Zego, has announced it has raised £1.225m in seed funding with backing from LocalGlobe.

The funding, which will support the development of its tech and allow the firm to grow out its technical team, comes a little under a year after the startup launched its flexible pay-as-you-go insurance product aimed at delivery drivers workers in the gig economy.

Providing policies from as little as 65p per hour, Zego looks to take the pain and expense out of insurance for those working in the on-demand economy, including couriers for Deliveroo, UberEATS, Amazon and others, who would normally have to lock themselves into an annual policy.

The system works by allowing drivers to top up their cover through their app with accounts debited after they have completed a shift, with telematics functionality set to be introduced soon.

Zego, which previously went by the name of Tego, has also just launched its first flexible insurance product for car drivers too, a service which is fully underwritten by Aviva.

Harry Franks, co-founder and CEO of Zego hinted that European expansion would inevitably be the next step on the journey as the startup looks to build on growth in London and elsewhere in the UK.

He said: “We want to empower people across Europe to work in the way that suits their life and commitments. We’re targeting part-time drivers with a product that is particularly tailored to help them get the most out of work. Buying insurance should be quick and easy, mobile, flexible and transparent.

“You should only have to pay when you earn and that way our insurance helps you to work and take control of your expenses.”

Robin Klein, partner at LocalGlobe, added: “The world of work is changing fast and services like insurance have a long way to go to catch up. Zego is a simple idea but it has the potential to free millions of people around the world to work in a way that suits them.

“As Zego collects more data about delivery drivers it will also help the insurance industry price premiums more effectively, which ensures that sharing economy jobs really do pay for those who rely on them.”

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