Dan Ariely is joining Lemonade, a peer-to-peer insurance startup, as its chief behavioral office. That’s a new one!
Insurance is a bad-boy place for honesty, Ariely tells the Financial Times. The current system encourages insurance companies to delay payments and policyholders to exaggerate their claims. The madness has got to end.
“We’ve spent years deepening our understanding of honesty and trust, and our conclusion is that insurance is crying out for a makeover,” Mr Ariely said.
He has personal experience of the problems. In Predictably Irrational he recounts a frustrating — and expensive — trip to Boston to renew an insurance policy that had expired. “It was a point in my life when I realised how abusive insurance is,” he said. “We need to create a very different system.”
Photo: Travis Warren