InsurTech: The future of insurance is in partnerships
2016 was all about InsurTech: cash flowed in, the incumbents sat up and took notice, and a slew of start-ups arrived on the scene to grab the insurance industry by the shoulders and give it a good shake. Now, as the hype subsides, FinTech Futures have launched InsurTech Bytes podcast series, inviting John Egan, strategy practice lead at Anthemis, Dan Smith, Managing Partner at Exponential Ventures, and Jannat Shah, Associate at AXA Strategic Ventures to chew the fat on all things InsurTech: where’s the smart money heading? Why should the big players partner with start-ups? What effect is Brexit having on InsurTech VCs?
Following on from the first serving of InsurTech Bytes, the podcast for the future of insurance, we take a look at the top 10 takeaways:
- Hype is settling into the practical implementation and the focus is on where in the value-chain Insurtech innovators will focus next.
- The customer needs to be queen/king.
- Partnership is the way forward. Enablers are leading disruptors across the Insurance sector, presenting an exciting opportunity for insurers to drive forward their digital transformation. InsurTech has developed (largely) with a view towards partnership rather than disruption; there are only 3 end-to-end insurance propositions globally.
- Legacy issues persist, innovation from within large institutions is tough and Brexit sucks.
- It’s hard to leapfrog in the insurance sector.
- Timing matters. It has been 10 years since the crisis and the insurance industry hasn’t been under the same pressure as banking. The nature and complexity of the sector has kept competitors at bay.
- InsurTech requires patient capital, so it doesn’t fit with the aspirations of all funders.
- The elephant in the room is that disruption may come from unexpected and well capitalized competitors, for example, InsurTechs partnered with Reinsurers looking for a route to go to direct to consumers.
- Incumbents need to “be able to partner with many businesses of any size, at speed, at scale and simultaneously,” according to John Egan, strategy practice lead at Anthemis.