2018 has been an exciting year for the insurance industry – investments, partnerships and collaboration are shaping the future of the industry and new, and more sophisticated startups are emerging to leverage the insurance business models of the future.
InsurTech start-up activity slowed down in the first half of 2018. This trend began last year, with 2017 seeing the launch of half the number recorded in 2015 and 2016. However, the decline in start-up activity doesn't mean that the InsurTech gold rush of the past years is coming to an end - money continues to pour in. InsurTech investment is expected to remain strong as investors shift their attention to more stablished InsurTechs.
Commercial lines are expected to see a significant increase in investment with start-ups such as TrachMyRisks, Finanzchef24, Insureon, and Zensurance getting more established. They are proving the need for new and seamless digital customer experience.
Personal insurance innovations in customer acquisition process, operations, telematic sensors, and analytics are still the focus of many start-ups however; life insurance and annuities are generating far less InsurTech activity compared to their property and casualty counterparts. Will 2019 be the year when life insurers streamline products, simplify underwriting, and advance self-service distribution systems?
AI, big data and automation have become the norm across the insurance industry, from chatbots to a steady focus on customer experience and Machine Learning to improve fraud ratios, underwriting decisions and claims processing. Some of the startups that stand out in this space include: Cystellar, Digital Fineprint, Spixii, Rightindem, Elafris.
In addition, blockchain is another technology that most insurers are aware of by now, exploring how it may impact the industry.
Some insurers are already taking the tentative first steps to apply blockchain or engage in pilot projects.
However, many others are still working out how it fits within their technology development plans. A tangible impact from blockchain is long term compared to technologies mentioned above such as AI or even IoT. Nonetheless, there is a growing number of initiatives and InsurTech start-ups making serious advancement in the field including buzzVault, Insureblocks, Black Insurance, Etherisc, Chain That, Dynamo, InsurETH, Teambrella.
Wearables, location-based sensors, sensors on objects and other forms of IoT technology and connected insurance are quite established at this point. Fitness wearables are helping health insurance companies assess and predict their customers’ health translating in fewer claims; telematics-based car insurance are pricing their rates by customers’ actual driving frequency and habits; smart home monitoring systems are enabling homeowners to optimise security and prevent house damages while also reducing claims. Roost, Betterview, Oscar, Nest and canary are some of the start-ups in the IoT space.
Within on demand insurance, there is another wave of exciting startups that have arrived to stay. Cuvva, Veygo, FRISS, Trov, Slice are turning on demand insurance mainstream. Incumbents are no doubt reacting to these trends, albeit sometimes half-heartedly, due to scepticism about the economics of the models and the expected challenges of transitioning from legacy systems, processes and people.
InsurTech Rising 365 echoed the challenges and transitions that the industry is facing to adjust to this digital era. Cyber security, behavioural science, robotic process automation, the ethical challenges of using AI and how to design the workforce of the future to enhance the technologies mentioned above are and will be part of all discussions in 2019.
We, as industry, have seen plenty of synergies with the rest of the world and although UK remains the main InsurTech hub, Germany, France, Spain and, of course, the US are not too far behind.
International incumbents are investing in international startups; and partners and collaborations are happening across the globe.
InsurTech Rising Europe will be back in 2019, more international than ever with the intention to build the European InsurTech map and to showcase the latest developments in insurance. We are here to stimulate a conversation platform to enable collaboration, partnerships and investments between investors, incumbents and start-ups. Start preparing yourself to be part of the InsurTech Rising ecosystem showcasing new start-up launches, developments and announcements, successful partnerships, corporate investment strategies, incumbents innovation strategies, and futurist analysis of the industry.
-Rocio Sarriegui Zulueta, Brand Editor for InsurTech Rising