German insurer Allianz is suing neobank Revolut for $13 mn, claiming the neobank was in breach of contract after it moved its customers away from Allianz to a different insurance provider.
The agreement between the insurer and fintech, signed in April 2022, meant Allianz became Revolut’s travel insurance provider in 31 markets.
Now, according to InsurTech Magazine, Allianz claims Revolut is in breach of this contract by moving its customers to a new insurance provider and terminating the agreement.
Revolut website states that Chubb European Group is its travel insurance provider, taking over from Cover Genius on November 13, 2023. Cover Genius had taken over travel insurance for Revolut from Allianz on May 16, 2023, when it provided cover from Cowen Insurance to Revolut customers.
Now replaced by Chubb, Cover Genius’/Cowen Insurance’s partnership tenure lasted just six months.
Whether Cover Genius will take similar action to Allianz remains unknown – this would depend on the nature of its contract with Revolut.
The breach of contract alleged by Allianz claims that Revolut failed to compile a daily report of eligible account holders for collective policy release benefits – data that enabled Allianz to calculate the monthly premium installments payable by Revolut to the insurer.
Even after Revolut terminated its contract with Allianz, the neobank – according to the insurer – was still required to continue supplying a daily report to Allianz, which it did not.
Allianz claims that these reports provided to it from June 2023 onwards did not accurately reflect the number of eligible accounts for collective policy release benefits.
Adding further fuel to its claim against Revolut, Allianz also alleges the neobank breached deal terms by modifying the travel insurance product and its conditions for beneficiaries without written approval from Allianz.
As an open case, the outcome remains undetermined – as does the potential reputational damage to Revolut. by Peter Sonner