IAG has received “great” consumer feedback from a trial run of a new motor insurance product created last October.

But the insurer has not yet decided if it will go ahead with a full-scale launch of Poncho Insurance nationally, a spokesman told insuranceNEWS.com.au. The trial is currently restricted to NSW consumers.

The spokesman says the name fits the meaning of the original Chilean native word, which describes a warm fitted cloak.

“Poncho Car Insurance is like a monthly subscription with no lock-ins or cancellation fees, created to offer customers a simple and flexible insurance product for their changing needs.”

“Our research shows that how customers live and move from A to B is changing,” he said.

“There is a segment of customers in Australia who want more flexibility in the products or services they use. With this demand we see an opportunity to create different insurance products.

The product is designed to be flexible, with customers allowed to have more than one car insured under one policy.

According to a blog post by the new brand, the philosophy behind its business model is simple.

“When you buy Poncho Insurance, you do it on your own terms. We don't want to trick you into staying with us long-term, or limit what you can add to your cover.