This week, I am writing this post from Des Moines, Iowa as I am attending the Global Insurance Symposium. More on this conference during next week’s post.
As I think about the concept of ‘Global Insurance’, I can’t help but think of the current leader in Global Insurance innovation.
And for that, we need to look out east to China.
My first article on Daily Fintech was entitled ‘Zhong An IPO tells Insurance incumbents that full stack Insurtech has arrived’ and I covered why that specific IPO put Asia at the ‘top of the Insurtech leader’s club’.
This IPO reaffirms that Asia (and more specifically China) still remains the leader in terms of Insurance innovation (i.e. Insurtech).
This week, I take a look at:
- Recap of Good Doctor
- Details of the IPO
- We keep talking about Amazon…what about Google and Apple?
- How regulation will allow China to stay at the top of the ‘Insurtech leader’s club’
Recap of Good Doctor
For those of you that have been following these posts for a while, you will know that I am a big fan of Ping An’s ecosystem, specifically their Good Doctor app.
Zarc, our former China Insurtech author, now China Blockchain author, covered Ping An’s Smart Insurance Cloud late last year.
I also took a deep dive into their healthcare ecosystem last year upon news of the CVS and Aetna merger here in the states.
According to the Ping An Health and Technology Company site, as at end of 2017, Ping An’s Good Doctor had 192.8 million registered users, which have access to ‘3,100 hospitals, 1,100 healthcare check-up centers, 500 dental clinics and 7,500 pharmacy outlets’.
Those are just offline services.
Online, users have access to search for and book doctors, have an online consultation with a doctor, purchase medicine, get access to information about various health topics, either general or specific to them and monitor their own health plan.
Without belaboring the point, hopefully you can see why I consider this as the gold standard of ecosystems.
Details of the IPO
According to South China Morning Post, the IPO is expected to raise about $1.1 billion (up to around HK$8.7 billion), as they plan to sell around 160 million shares for a price between HK$50.8-$54.8.
The image below (taken from the same article above from South China Morning Post) shows that if this IPO is priced towards the top, it could be ‘the largest flotation by an internet business since ZhongAn’.
In the same article, it is said that ‘So far, they have received pre-registrations worth some HK$63 billion, according to information available from the firms, reflecting a possible oversubscription of more than 100 times.’
Further, ‘Seven cornerstone investors will put a combined HK$4.32 billion into the float: BlackRock, Capital Research and Management Company, the Singapore government’s investment fund GIC Private, Canada Pension Plan Investment Board, Pantai Juara Investments, which is wholly owned by the Malaysian government’s investment fund, CT Bright Holdings, an investment unit of Thailand’s conglomerate CP Pokphand, and Swiss Re Direct Investments Company.’
The public is excited. Institutional investors have taken notice. Perhaps others also share the same sentiment with me as it relates to being the gold standard in healthcare ecosystems.
We keep talking about Amazon…what about Google and Apple?
Last week, I wrote about the U.S. healthcare opportunity, focusing on some of the potential mergers taking shape right now, with reference to an article I wrote earlier this year on Amazon’s entrance into the U.S. Insurance industry.
What about some of the other tech giants?
Both seem to be looking to aim to focus in one way or another on detection, prevention and monitoring of diseases. For Apple, they already get plenty of data on a person’s health through their wearables and other technologies embedded in their smartphones and has even Apple Health Records with 39 hospitals in the U.S. This should massively help doctors in monitoring and treating their patients.
While the Google research mentions ‘Insurance’ a few times (the Apple one does not), it still seems to be focused on building tools to help hospitals, doctors and patients with the ongoing management and treatment of healthcare.
Both companies have the ability to build an ecosystem. Whether they jump into Insurance to bring the whole thing together, like Ping An has done with Good Doctor, remains to be seen.
How regulation comes into play
Data regulation and data privacy has been a hot topic as of late.
In an ecosystem, especially one whereby data is used for the ongoing monitoring, detection, prevention and treatment of an individual as personal as healthcare is, there needs to be some sort of laws that help to protect the consumer.
On May 1, 2018, Personal Information Security Specification is set to be in effect in China.
On May 25, 2018, General Data Protection Regulation (GDPR) in Europe is set to go into effect.
In the US, I found this article interesting which states ‘As of yet, the United States does not have any centralized, formal legislation at the federal level regarding this issue, but does insure the privacy and protection of data through the United States Privacy Act, the Safe Harbor Act and the Health Insurance Portability and Accountability Act’.
It is interesting for me that the U.S. does not have these sort of laws in place and that China and Europe are ‘leading the way’ in this respect. If you want to read more on this, have a look at this superb analysis.
Regulation, while important, can sometimes get in the way of innovation. It can also help to make innovation more safe for individuals. It will be interesting to see how these new standards in Europe and China (especially with respect to Ping An’s ongoing running of Good Doctor) play out. In the U.S. it will be interesting to see how data protection is handled as a whole and how that then impacts some of the great work being done by Google, Apple and others in the healthcare space.
It’s exciting to see another Insurance technology innovation go for an IPO. It’s not a surprise that it is happening in China.
As their middle class grows and unconstrained by legacy investments, China can invest in the future. One example is smart cities where it is reported that, ‘Over 1,000 smart city pilots are ready for or under construction worldwide, and China is home to about 500 of them’.
Many Insurance executives from around the world keep flocking to Silicon Valley (or the midwest of the United States as with this week!) to understand the innovation that is happening around them to see how it can impact their existing value chain.
I say, go east to China.
Stephen Goldstein is an experienced Insurance executive and Insurtech dealmaker with a core focus on growing revenue, launching go to market initiatives and advising industry leaders.
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