TikTok pushes SME insurance into merchant platform

ERGO NEXT offers liability workers compensation and cyber cover through seller onboarding.

TikTok is expanding its role in insurance distribution by partnering with ERGO NEXT Insurance.

The partnership allows TikTok Shop merchants to purchase business insurance products, including general liability, professional liability, workers' compensation and cyber insurance, through TikTok's merchant onboarding and business management platform, according to GlobalData.

GlobalData said embedded insurance is expected to become a major distribution channel in the coming years as more digital platforms integrate insurance products into their services.

According to GlobalData's 2025 SME Survey, 39.1% of small and medium-sized enterprises (SMEs) globally said they had been offered business insurance when purchasing another product or service through a marketplace platform. 

Of those offered embedded insurance, 48.8% purchased the coverage.

Beatriz Benito, lead insurance analyst at GlobalData, said embedded insurance enables insurers to reach customers at the point of sale, including businesses that may not otherwise seek insurance cover. 

She added that the convenience of purchasing insurance alongside another product or service contributes to higher conversion rates.

The new offering streamlines the insurance purchase process for e-commerce businesses by using information already available in merchants' TikTok Shop profiles, reducing the need for lengthy application forms and questionnaires.

GlobalData said embedded insurance could also lower distribution costs by reducing marketing and brokerage expenses, potentially leading to more competitive pricing. 

The model may also help address underinsurance amongst SMEs by increasing awareness and accessibility of business cover.

Benito said the partnership reflects a broader shift towards embedded commercial insurance. 

Whilst embedded insurance has traditionally focused on personal lines, she expects future growth to increasingly come from commercial lines despite the greater complexity of business insurance products.

Some businesses may be reluctant to purchase insurance through marketplace platforms due to concerns about claims handling, whilst others may still prefer personalised advice before buying cover.

Benito said the next phase of embedded insurance innovation is likely to focus on smaller businesses with simpler insurance needs, with adoption amongst larger and more complex organisations expected to take longer.