When we look at the connected objects of vehicles, or more technically what is called telematics, a major problem appears: the exploitation of data! The startup Otoconnect focuses on this segment and is working on the provision of multiple connectors, around a first target, the portability of contracts under the GDPR regulation. Continue reading “Otoconnect – Vehicle’s data platform”
Here is a little overview of articles that caught my attention and deserve to appear in the press review of January 30th 2018!
Astonishing experimentation of CPAM
The question of personal data and above all health data is really sensitive in France. Market players are also very focused on these issues in the context of the arrival of the GDPR regulation. However, this is the moment chosen by the Social Security to try an initiative really out of the ordinary. In an attempt to fight absenteeism, the Social Security has communicated to companies, whose absentee rate was 4 to 5 times higher than the average, the reasons for work stoppages, and first those related to MSDs ( Musculoskeletal disorders) and those of the PSR (Psycho-Social Risks).
The stated objective, in agreement with the trade unions, is to encourage the company to question the practices, and to consider prevention solutions upstream.
We are here in a very interesting process of exploitation of health data for the purpose of prevention! Crossing sources now allows this type of analysis, and it is interesting to note that neither the French CNIL nor the unions have opposed the approach, which shows the quality of the exercise!
Case to follow in a few months, with the first results of the test and an extension of the companies concerned.
Expanding Google’s artificial intelligence in Paris
Following his visit to Paris on the road to Davos, Sundar Pichai, CEO of Google has announced its desire to strengthen, in Paris, his team dedicated to artificial intelligence. France is positioning itself as a real actor for the future on the subject.
More interesting, it turns out that Google’s offer tends to a SaaS offer, on the shelf, intended to be accessible to everyone, even without knowing how to code. This is the goal of Cloud AutoML vision (ML for machine learning).
Note: There is a free trial, I note in my todo to go try for you! If you have a specific use case (why not the pictures during claim’s FNOL), let’s do it together!
Emotional intelligence, or the complement to artificial intelligence
A reminder of what is emotional intelligence and how it is now essential! In a context where artificial intelligence seems to take more and more space, it is interesting to follow a subject for which the role of the human seems to remain necessary!
The event to be
Novarica and the IOT insurance observatory offer a webinar on their research on February 28:
Matteo Carbone is an opinion leader in the insurtech industry today as one of the most prominent on the market. He created the Connected Insurance Observatory, an international working group, first in Europe, then in North America, dedicated to insurtechs. Matteo participates in numerous conferences around the world throughout the year. He unfolds his theory of 4P’s of insurtechs, and I wanted to make a presentation for a long time.
The 4P’s of insurtechs
First of all, you can listen to Matteo Carbone in his presentation at the 2017 Global Insurance Symposium in Des Moines.
You can also find slides at this link, if you are an aficionado of his prose, without listening to his wonderful English accent!
Key points to remember
According to Matteo Carbone, insurtechs can intervene on 4 axes:
- Productivity : be more efficient
Profitability : get a better technical result
Proximity : to be closer to the customer and his needs
Sustainability of the portfolio (the term it uses is “Persistency” which means persistence over time, and therefore no attrition): Build a profitable portfolio on the long run term, with a small rotation.
In the absence of these objectives, there is no interest in innovating because the solution will not bring anything useful.
The second subject addressed in this presentation is telematics, because it is one of the key topics of Matteo Carbone. The Swiss Re report which I was echoing a few months ago is directly worked with him, when it comes to the Italian example.
3 topics to consider:
- The connected object : often a black box connected to the vehicle
- Insurance coverage : and the notion of incentive reduction associated with it
- Associated services : access to a set of additional services that can be provided for a fixed fee.
Under the arguments that telematics allows of itself and of course a selection of the best risks ( Note: it is questionable ) and a better controls of the compensations ( Note: that on the other hand, I share ), he comes to the conclusion that the financial result of the insurer is improved thanks to this technology.
It is also possible to rework the customer experience on all of its use of the vehicle and the different needs that might be relevant. Note: this aspect is absolutely essential, because it is from the use that one deduces the exploitation that one can make technologies.
Finally, the figures it presents show that attrition will be lower with telematics than without (11% instead of 14%).
In short, that positive points!
I share a lot of Matteo’s conclusions.
By reading, you will understand that the questions of use and business need interest me first. The 4P’s of insurtechs are a key to reading that is interesting to keep in the lead.
I update my landscape insurtechs with 15 new startups on January 19th, 2018. You’ll find the update here. There are now 123 startups documented, coming from 17 countries.
Au menu d’aujourd’hui:
- Hippo: Advanced home insurance and Quote in less than 60 seconds.
- Slice: On-demand insurance.
- Metromile: Insurance Pay-as-you-drive, based on driven miles.
- Bought by many: Grouped insurance buying.
- Understory: Environments captors (humidity, temperatures, wind, rainfalls), similar to mini weather stations which enable to audit afterwards the losses due to weather origins.
- Affectiva: Emotions detection, Sentiment analysis and SDK deployment.
- Jaco: Insured Behaviour data collect on web sites in order to improve the user experience.
- Coverfy: Multi Insurance contracts management from a mobile phone, double coverage identification and Proposal of price improvements.
- MyZuum: Telematics to add to the vehicle, Emergency alerts, prevention, driving behavior improvement, mechanical diagnosis….
- Brokoli: Insurance contracts assessment from mobile phone and Distribution.
- Drivies: Driving data analysis from a mobile app, Driving improvement propositions and Insurance price improvement proposition based upon collected data.
- Predictry: Sentiment, choice or behaviour prediction thank to Machine learning and Predictive analysis and automatic recommendations.
- Twiggle: Buying intention predictions thanks to natural language processing, machine learning and ontological models.
- Conversable: Chatbot with a Saas Platform.
- Leocare: Motor and Home insurance distribution via mobile, Quote in 45s and On-demand insurance for some additionnal options..
The broker Gras Savoye, belonging to the Willis Towers Watson Group, published in september 2017 an interesting economic note on the transformation of the insurance markets 2018. They come back therefore, by business line, on current trends.
Overall, the French insurance market is rather stable:
- The world market is down slightly
- France remains an important market (5th world player), with just over 200 billion euros of premiums
- Personal insurance accounts for 75% of this figure, and sees a rise in pension premiums
- Property insurance is subject to strong competition, and is experiencing a significant increase in claims, which affects the underwriting results. This is due in particular to climatic events.
In the details of the 2018 insurance markets
Given the richness of the report, it is complicated to synthesize it, and I prefer to suggest that you refer to it if necessary. I prefer to present the plan!
Each theme is treated according to 5 axes:
- Capacity / Appetite
Some key things to remember
- 3 alternatives to risk transfer are presented:
- Structured Insurance: covering the multi-year consequences of new or complex risks. (terrorism, pandemics, strikes, etc.)
- parametric insurance : or index-based insurance, which i have already talked a lot here
- Mutli-line / Multi-year approach: which reduces volatility
- D&O (Executive) policies continue to evolve and adapt to changing risks. The tailor-made is put on this profitable and dynamic market (new regulations, cyber risks, etc. which increase the risks for managers).
- There is growing interest in combined fraud / cyber collateral, although these mounts do not always yield the best proposals. Note: It is understandable that customers are always looking to hedge against an unknown risk, but perceived as critical .
- Kidnap & Ransom products are in full swing, because of an international geopolitical context that is sometimes hazardous.
Conclusion: My opinion
This report is a mine of information, very technical, but essential to a good understanding of the complexity of heavy risks. A disadvantage on the bedside table, but imperatively under the elbow!
In hollow, one sees there appear, as often, the insurance products which could be generalized tomorrow. The trends observed, especially on cyber, fraud or regulatory aspects are in this sense good indicators of the future.
Here is a little overview of articles that caught my attention and deserve to appear in the “press review January 15th, 2018”!
O’Reilly offers books on data and artificial intelligence
The famous publisher of computer science books has a library of 80 of its publications on big data, artificial intelligence and data science, published between 2012 and 2016. Essential detail: the download is free, in pdf, epub or mobi.
Remember: when it’s free, you’re the product! O’reilly asks for your name, first name and email to download, but nothing forces you to enter the real …
Not so accidental road accidents
Mathieu Grossetête is a researcher at the university research center on public action and politics. We propose in the Diplomatic World a reading interestingly, accidentology by car.
It appears that the prevention policies of Road Safety may now reach their limits because they are poorly targeted! Or when the art of data analysis becomes essential to better control a phenomenon, and treat it correctly!
Exciting article to read, which makes us rethink the notion of risk analysis, the perception of events. Finally, it simply invites us to change our way of thinking.
Typologies of wearables
Evan Kirstel, one of the leading thought leaders in connected health, offers us a panorama of typologies of connected objects for health, aka wearables. This one goes a little further than the usual dichotomy watch and bracelet vs balance!
Deloitte: human collaboration – machines
A visual of a Deloitte study, found on Twitter, gives an interesting reading of the symbiotic relationship that can develop between humans and machines. All thanks to the service rendered!
Axa and telemedicine
Jacques de Peretti, CeO of Axa in France announced this week the launch of telemedicine in companies and openness from service to experts.
The second service is the extension of the current service (which I had the opportunity to test personally and which is very good). On the other hand, the first one supposes major investments and questions around the model chosen by Axa.
The question of danger, posed by Olivier Harmant, is in my opinion not relevant.
However, what is the return on investment of this model for a complementary insurer? Indeed, a teleconsultation at the expense of the complementary supposes a cost support higher than the usual part. In order to be financially attractive, such a service needs to be either cheaper than normal consultation or to reduce risks. For now, teleconsultation is a vector of brand image and carries a demarcation line with respect to the competition. However, when everyone will do it, it will be necessary to consider the business model that goes with it!
Finally, should not this be the role of an intermediary platform? The latter would make this service available and look for the insurer who answers it. On the contrary here, it is carried directly by a complementary insurance? What does this say about our public health insurance? A lot of questions, few answers for now!
A conjunction of elements led me to reflect lately on the link between insurance, innovation and behavioral evolution! It is an opportunity to give you my point of view on the issue.
Insurance is often considered reactive. Indeed, it reacts to events called claims to compensate for the residual loss.
Campaigns, sometimes famous (I think about road safety), are intended to transform behavior upstream to reduce downstream losses. For the insurer, it is an initial investment that finds its ROI in reducing the indemnification. We are here in a model in which the insurer is a preventer and no longer just a compensator.
However, a lot of debate has taken place in recent years to give the insurer a more proactive societal role upstream to reduce risks and thus change behavior. The embedded telematics (with Pay-How-You-Drive offers for example) has often been seen as an incentive for good practice: if you drive better, I make you pay less. Ditto for connected bracelets of health: if you play sports, you will have a reduction.
However, we note that these approaches do not always work or that they are not effective. However, do not we say “chase the natural will come back at a gallop”? The challenge is therefore twofold:
- Find new ways to influence behavior.
- Adjust offers to better stick to individual behaviors rather than standardizing responses.
Nudges at the service of behavioral change
It will probably not have escaped you that the last Nobel Prize in economics (2017 ) was awarded to research on the so-called behavioral economy. To learn more, read here . This is also called benevolent manipulation.
I will not attempt here to detail fully the possibilities offered for insurance, because it deserves to think seriously about it. Anyway, I invite you to read the very good article from one of my competitors on the issue. Here is the example cited:
For some American motor insurances, the declaration of the mileage achieved in the year (n) conditions the premium for the following year (n + 1). The average rate of under declaration is estimated at 15% compared to the Km actually made. A Nudge has been tested to try to improve the statements. Instead of signing the declaration on honor at the end of the document, the researchers put it on the heading of the document, before the declaration. This simple change results in a 10% increase in the number of Km declared, a gain for the insurer of $ 48 per insured. The simple reorganization of the structure of the document, the architecture of choice, makes it possible to modify the behavior of the insured and thus to increase the income.
Some examples of nudges for insurance
Here are some examples of nudges that are or could be relevant to insurance depending on the objectives:
- Reducing risks: The incentive to drive better.
- The solution implemented by Liberty Mutual and relayed here consists of a mixture of gamification and information to drivers. Thanks to embedded telematics, the solution allows everyone to consult their driving information and to consider how to drive better and therefore how to reduce their premium, the discount rate being updated live every day for 3 months before being fixed.
- By extending the exercise outside the pure scope of intervention of the insurer, we can note that tracing, on the road, shorter white stripes gives the impression of going faster and encourages you to slow down without even realizing it.
- The incentive to subscribe:
- A study relayed in the book above (London Economics and YouGov in 2013 for the FCA) showed the impact of the presentation of the insurance offer in parallel with another product. This is the case for example when buying the insurance when buying a mobile or cancellation insurance.
Beyond the questionable ethical aspect, this shows the influence of the distribution strategy on the choices of insured.
- The choice of priorities: Last-mile problems (read for it this article and that one)
- Segmenting the populations can be done according to a probability of underwriting. By identifying 3 segments (low, medium and high effort) using artificial intelligence, we can then determine who has the strongest probability of traveling the last mile to the subscription. These populations, for which the effort is small, will be treated differently and maybe receive, when the time comes, a little nudge! This can be a text message, a small message on the screen or a welcome email when giving the little extra that will be enough to convince them.
I will come back to these questions later with other detailed use cases to imagine more precisely how to use these methods.
Most of the current offers are very standardized. They take into account a need considered identical for all insureds. At the time of individualization, why could not we consider adapting the coverage more finely according to the real risks of the insured. I can already hear the reactions: “This is the essence of our job”, “We already do it”, the contracts offer options and choices of levels to ensure according to his needs. “Very good, but in truth, can one think otherwise?
The Wilov speech is very interesting on this point. Most auto insured drivers drive less than 50 days a year. Yet they are covered full time. By inventing the “Pay-When-You-Drive”, their starting premise is to charge drivers only when they drive! The price is not necessarily much lower, however, the feeling of the insured is much better (provided that the user experience is the appointment of course!).
The approach of Inspeer goes in a similar direction. Starting from the premise that changing the behavior is complicated, Emmanuelle Mury and her team are working on the notion of affinity groups that go around the use. Clearly, they identify similar behaviors, and create the corresponding supply. I will come back to this in a dedicated article!
In short, the notion of supply is still too much seen today as unique, identical for all. Indeed, IT systems did not allow to easily and quickly deploy variants and customization, or the illusion of personalization was at the marketing level. It’s time to move to a higher level!
And you what do you think? When do we start to revamp your offers?
What you may have missed, like me in 2017!
If like me, you follow between 50 and 70 sources of information (rss feed) on a daily basis, not counting the linkedin and Twitter publications, it sometimes happens to lose your mind and miss some interesting information.
More specifically, it often happens to see an article that we think would be interesting and keep it for later. But this later comes only rarely and we end up with a small stack of articles to read!
For me, this blog has solved the question about the publication of reports, which remained on my desk waiting for something. For the articles, it is not quite that still, and I find myself at the end of 2017, with a good fifty articles under the elbow. Here are some of them, which you may have missed too!
The Tribune – Assurtech: a disrupted industry, for the benefit of the customer?
Daniel Haguet, professor of finance at EDHEC, who was few (hum) years ago my teacher, gives his opinion on the phenomenon:
- 75% of insurers consider that their industry could be disrupted
- Big data, by aggregating data, even out of the insurance, allows a customization of offers
- Distribution is growing online thanks to the rise of the internet
- For many players, the challenge is to take a stake in these structures, to take advantage of both technological advances and the “captive” portfolios of clients.
Note: For a selection of insurers’ strategies with insurtechs, it is here !
Structuring technologies and forces
Seen on Twitter, but unfortunately without noting the source, I share it, because although incomplete without a caption, it seems to me wider in its acceptance of technologies than many current reports and panoramas, including mine !
Here’s another one, which gives a little overview of the issues ahead.
Medium – Insurance as a smart contract
Aigang Network summarizes what insurance contracts will be tomorrow, thanks to smart contracts. Better yet, rather than a long speech, they made a demo, wrote the code around an Ethereum blockchain ( accessible on github ) and an app to test it, as well as a video, here:
Note: For a selection of articles on the blockchain, this is here
Risk management – Investing in the insurtech toolbox
A small inventory of insurtech solutions that address the issues of risk management:
- Understory weather
- Safety culture
- Security Scorecard
- Risk IQ
- Human Condition Safety
- DAQRI Smart Helmet
Note: To find my overview of insurtechs, it’s here !
Intercom Blog – Machine learning is easier than it looks
Once is not customary, a somewhat technical article, but that gives a specific example of what can be done with machine learning in 40 lines of code. Frankly, it’s a gift!
Note: For a selection of articles on artificial intelligences, it’s here !
The digital journal – connected objects of health, french social security does not perceive the added value
The title is deliberately provocative and surely a little removed from reality, when we know the current reflections! However, Laure Beyala, a biomedical engineer in Bichat, who has published a book on connected health objects, offers an interesting vision of the issue. She returns in particular on key concepts: Role of the social security, the insurers, DMP, brakes with the development, etc.
Note: For a selection of articles on connected objects, it’s here !
P & C360 – Telematics in auto claims is inevitable
This article is totally in sync with my opinion on embedded telematics (see my predictions for 2018 or even my note of conjuncture on this subject ). It goes back to what can be done with it, and why the use of this technology for disasters is inevitable!
Note: For a selection of telematics articles, it’s here
Insurance Thought Leadership – Why is Customer Experience Key?
This article is about a concept that I consider essential! Data, processes, technologies must be oriented around the customer and his needs. This is all the more true as connected objects and their billions of data become more and more accessible in the years to come.
Note: For a selection of articles on the user experience, it is here !
A visual that I like about design thinking and ideation strategy that I integrate more and more in my thoughts because totally related to the notion of innovation. The content could not be done without the form …
FrenchKlein Blue Partners has published 2 interesting reports on the market about insurtechs. The first one, France insurtech panorama was published in June 2017. The second, “Benchmark Insurers facing insurtechs and innovative players“, was published in December 2017. They confirm this young consulting firm’s (and its partner Salim Echoukry ) desire to position as a quality partner for insurers who have questions about their innovation strategy in the market. I start the year by not being late and therefore deals here with the last published! Continue reading “REPORT KleinBlue – Benchmark insurers facing insurtechs”
As it is frequent at the beginning of the year, I too will fall into the game of predictions for the coming year. With my 6 topics for 2018, here are the 6 points that I think will be 2018 on innovation in insurance:
I think the moment is good to launch complete offers around telematics embedded in cars, smart homes or wearables. When I think of complete offers, it does not just mean capturing user data. It is also, above all, and before all, providing services to these policyholders or using these tools to implement new prevention policies.
This may be the consequence of the previous point, but a little wider, a redesign of offers. It’s time to think about offering insurance products as the structuring element of the insurance value chain, from prevention, to disaster, to adding service. For example, the improvement of claims management will only pass a complementary course when products are designed to be managed quickly and simply.
I often talk here about decomposing the value chain with the setting up of experts at all levels, namely, risk bearers, distributors and managers, for the purely insurance part, but also service providers. ecosystems that will need to be mobilized intelligently. The advent of the platforms will aim to move towards this type of organization where everyone will find his place!
As a direct consequence of the previous point, if the same contract must concern multiple interlocutors, the notion of interface between them is essential. Maturity on these issues has greatly increased in recent years. Simple EDI flows (like those still used for third-party payment for example), we moved to advanced webservices but sometimes complicated to set up. Then, we now come to expose real complete services, through webservices or APIs to access the data without necessarily changing the technical architectures in a structuring way.
The needs in this segment are exploding, and it will be an intelligent response that avoids the pitfall of systemic risk! For me, here more than elsewhere, it means helping to prevent and reduce risks upstream to avoid the most frequent attacks. On the technological side, the weakest link is always first and foremost the human, it is about takins this into consideration! By the way, how do you manage your passwords?
A user experience at the heart of all steps
The last few years have been mostly devoted (except for the more advanced ones) to work around the efficiency of processes, and how to do it for less! It is now to be interested in doing better for the same price, or better for less expensive. Better means here better from the point of view of the customer, because the essential thing is to simplify his life, to eliminate irritants. It is therefore customer demand that must be at the center of future optimizations.
It goes without saying that Siltéa and I are able to accompany you on these 6 topics for 2018! Feel free to contact me .
And you? What do you think? Do you have others?