If anyone has any doubt about InsuranceTech as a highly active and sustainable sector in Fintech, then they should get themselves down to SBC and see it in action for themselves. What you see at SBC are the emerging InsuranceTech startups in the early and emerging stages of their development.
From here, many will fall by the wayside early, some will get further and then stagnate or be consumed by another entity, and a few will go onto achieve great things, even Unicorn status. More often than not, the difference between success and failure in a startup is the team, not the idea.
Of course, the market has to exist too, and at around $5trillion, the global insurance market definitely exists and is very definitely crying out for modernization.
Which is why we have seen over $1.3bn raised by InsuranceTech startups since the beginning of last year.
Yesterday, I met with six InsuranceTech businesses that are all pitching for a place in the inaugural Startupbootcamp Insurance cohort starting in January. Like before, the format of the day was a short 5-minute pitch followed by 15 minute one on one sessions with the dozen or so mentors from the insurance industry.
When I look across the InsuranceTech space at all the new businesses, they pretty much all fall into two camps for me – Data or Distribution. Without naming the businesses, because I don’t want to break any confidences and besides, Nektarios and his team have not yet selected the final cohort, I have summarized the six under these two headings – Data and Distribution.
– an Internet of Things solution for the home. This app brings together all the home solutions deployed to manage security, heating, lighting etc. It allows the user to build rules, such as adjusting light settings to change according to the time of day or turning on the radio as the front door is opened. For insurers, this tech works for home insurance in the same way that telematics works for motor or wearables works for health.
– a SaaS operations platform that integrates the silo’ed and heterogeneous systems for underwriting, claims, policy, sales, finance etc. The platform aims to enable insurers to remove the inherent barriers and inefficiencies that result from their legacy architectures. The key benefit is realized by the COO and goes after the huge inefficiencies that exist within the insurance operations.
– a Solvency II solution that reduces the amount of time, cost and effort an insurance firm spends on compliance. Today, it is estimated that the UK insurance industry has spent $3bn on Solvency II but with very little direct benefit. This platform provides operational benefits by reducing the levels of effort, duplication and re working performed to meet Solvency II obligations.
– a digital insurance platform that makes buying insurance easier and simpler for the consumer. The model is simple…the platform takes your profile information at registration. It then builds a personalized risk profile and assesses the insurance cover you need for everything (home, motor, pet, travel, sports, health etc. etc.). Once it has this profile, the app trawls the web and finds the best products to meet your complete needs. The end game is that a consumer can buy all of their insurances through a single platform. The platform can guide the buyer to understand their risk profile and ways to buy better cover, in other words, to be the Nutmeg for insurance.
– an insurance aggregator with a model based on a cash back offer to the SME and the personal lines markets. Currently the big 4 UK price comparison sites spend around £100m a year on advertising and giveaways to get market share (which shows that there’s money in this model). The premise for this startup is that the primary buying criteria for protection insurance is price… and that a price promise to reward customer loyalty is the way to disrupt the aggregators.
– a distribution startup at a very early stage that aims to provide a single brand for the consumer to buy all their insurance cover. The digital, mobile platform would aggregate all insurance cover and make it easy and simple for consumers to buy insurance. They also have plans for their own insurance products based on a P2P alternative finance model to provide the capital to underwrite the exposure.
Applications for the Insurance cohort are about to close in 3 days time. If you see this article and want to get in to Startupbootcamp, go here and get your application before it closes!