Blockchain is for dogs and cats

blockchain c'est pour les chiens

On September 13th, Axa published a press release very noticed about the launch of Fizzy : parametric insurance coupled with a blockchain technology. I remain skeptical about the arguments, especially regarding the blockchain.

Operating Principles

The principle is simple! The insurer provides coverage against aircraft delays that triggers automatically without the need for a claim by the insured. It’s a simple product that lends itself well to parametric insurance. However, a nuance, the data made available by air operators or airports are limited, which now forces AXA to limit the exercise only on flights to / from Paris Roissy Charles de Gaulle airport.

The use case approaches so much (not to say almost identical) to the offer proposed by Bajaj Allianz last spring , which we echoed here. There was already talk of Blockchain, and I was already dubious at the time!

The complementary element that Axa brings is the principle of an open blockchain known to all (at least specialists): Ethereum. This makes it possible to use smart contracts, and according to Axa, to secure exchanges and transactions.

Useless technology use?

2 points disturb me in these proposals (Bajaj and Axa).

Useless technology

First of all, there is no need to use a blockchain technology to manage parametric insurance. This type of product, although still not widespread today, is not new and is already working. For example, Swiss Re proposed earlier this year in Taiwan a dedicated parametric solution aquaculture in Typhoons . If it rains more than 480mm for 2 consecutive days, the insurance is triggered, and the loss is automatically settled on the agreed bases.

The concept of parametric insurance (or index based insurance in English) is based on products built ad-hoc with objective and measurable parameters made available by third parties. Thus, during the subscription, the insured person covers himself for a measured risk and for an agreed amount.

At the occurrence of the risk (and if possible with data that are automatically provided to the system, from the weather services in the case of SwissRe), a simple rule engine integrates and interprets the incoming data flow to trigger a automatic transfer to the insured.

In short, IF (rainfall> 480mm AND days> 2) THEN Reimbursement.

In other words, no need for blockchain for that. Nevertheless, it is feasible with the blockchain, but it is a debauchery of useless energy! In the case of Axa or Bajaj, we bet that the objective is more to realize a proof of concept to validate the principles before considering other implementations.

Specious argument

The argument invoked by Axa to justify the use of the blockchain is security.

  • On the one hand, parametric insurance is not in itself a lack of security to justify an additional layer
  • On the other hand, the blockchain has not proved its lack of risk.

I come back to this last point! The blockchain is, by nature, secure! I will not come back here on the operation, a lot of documentation exists on the internet. However, more precisely, it secures what has entered, but does not prevent in any case, fraudulent maneuvers before entering or leaving the blockchain. Thus, we have seen in recent years theft operations / truanderies around the currency bitcoin, which have put on the straw several large operators of this currency.

The security argument seems so slightly usurped! It’s a marketing attempt to cover what ordinary people do not understand!

The blockchain is for dogs and cats or rare usecases of the blockchain

Make no mistake: I am rather in favor of blockchain technology! On the other hand, I am looking for real cases of use relevant to insurance. To this day, I only see one!

Pros and cons of blockchain

The blockchain has several advantages:

  • Decentralization of nodes within a network.
  • self-correction if a network node is altered or modified (this is what justifies the security argument)
  • Data Encryption

However, several important limitations apply:

  • Reduced” scalability”: performance is bad as volumes grow too much
  • Operational costs: it is a very energy-intensive technology. (eg power consumption of data centers / computer centers that” mine” bitcoins)
  • Difficulty of implementation between multiple actors who must share the same technologies and solutions.

Thus, despite the obvious strengths, the fact remains that the concrete use of the blockchain is complex.

The blockchain is for dogs!

To date, only one use case has caught my attention as a true viable example of the blockchain in insurance. It has been reported in the Market Force report. . This is to use the blockchain in the UK for insurance contracts for dogs and cats (and more generally it could be extended for any animal). All insurers can then share a common risk basis (animals) to ensure that a health expenditure for an animal is subject to only one insurer and thus avoid fraud. This is possible thanks to the blockchain, which simplifies the procedure and makes it faster and more reliable. Volumes are manageable without major performance difficulties, and lower regulation than for individuals makes more in-depth controls necessary.

Beyond this specific example, all the steps mentioned, including that of the B3i consortium that remains to follow, seems to me uses of the blockchain to surf the wave of media buzz, but not always wisely.

Talk about it!

What do you think? Have I missed something essential?

Feel free to send me your comments or remarks. I am curious to improve my understanding on this subject!

If you want an opinion on your projects, contact me , we can meet and talk about!

Landscape insurtechs June 2018

panorama insurtechs

The update of my landscape insurtechs goes on with 14 additions on May 21st, 2018. You’ll find the update here. There are now 179 startups documented, from 27 countries.

Besides, I have the pleasure to inform you that there will soon be another version of this site, in order to support an important project for innovation in insurance. Stay tuned for next updates, it won’t be long!

Additions to the landscape insurtechs June 2018

Newcomers today:

  • Get me ins: * Prediction and reduction of cases of fraud at source * Claims automation * Cost evaluation * Improved customer engagement.
  • Insurance Drip: * Digital marketing solution dedicated to insurance brokers and agents (websites, newsletter, recommendations generator, loyalty campaigns, etc.).
  • Insure App: * Customized and contextualised insurance platform * Pay-how-you-drive * Contextual health insurance * On-demand and just-in-time insurance e* Data analysis, profiling and segmentation, predictive modeling, real-time proposals.
  • Jamii: * Micro health insurance.
  • Nuvalaw: * Accelerates litigation through mass analysis of legal documents.
  • Tapoly: * On-demand insurance dedicated to self-employed workers and only.
  • Vlocity: * Cloud platform that offers tools for distribution and management of insurance contracts * Custom virtual agent.
  • Riskattitude: * Provision of virtual tools for estimating and analyzing risk.
  • Insurnext: * Creation of modern and responsive websites dedicated to the world of insurance.
  • Cogito Corp: * Human intelligence enhanced by artificial intelligence.
  • Cyquant: * Helps underwriting cyber risks by facilitating risk estimation.
  • Jooycar: * Connected Vehicle Platform * Real-time data analysis to provide contextualized insurance products adapted to the situation.
  • Hello Zum: * Centralized insurance data in the same place and made available to all parties * The customer is at the center.
  • So sure: * Collective insurance with retrocession of the unused portion of the premium.
  • Monuma: * Heritage advice and support * Blockchain dedicated to fine arts.

Contact me if you still don’t appear in the landscape insurtechs!

Key takeaways from Vivatech 2018

vivatech 2018

I had the chance to visit the Vivatech 2018 trade show held this week Versailles (Thanks @Anne!). This show is the global meeting of startups and leaders, according to their site. The figures announced by the organization are spinning, and the posters of Thursday’s conferences in particular speak for themselves. Make your opinion:

  • Emmanuel Macron
  • Mark Zuckerberg (Facebook)
  • Satya Nadella (Microsoft)
  • Dara Khosrowshahi (Uber)
  • Ginni Rometty (IBM)

In short, the best of the world’s tech was at the rendezvous, helped by a calendar facilitated by the summit Tech for Good organized at the Elysée the day before.

Beyond the numbers, what does it take for the insurance industry?

Vivatech 2018 or the bubbling of ideas

A half day to walk in the aisles allow you to get a pretty clear idea of ​​the challenges ahead in the years to come. All sectors of activity are undergoing transformation and all technologies are on the table. Like a competition Lépine innovation, it is to whom will propose the solution the craziest, the wackiest or the most breathtaking.

vivatech 2018 Not everything is good of course, but for anyone of us, it is essential to fully measure the transformation at work and gauge the impacts. potential. What about these little robots that welcome you at the entrance, will they replace a physical reception? What about artificial intelligence, will she keep her promises?

In short, in the excitement of the show, we must find inspiration to explore our future. However, this can not be enough, because the challenge is to find the applicability in the short term to trace the path to the transformation of society and trades.

A sector of the insurance and the financial tertiary sector little present

Insurers side

Overall, the insurance sector is poorly represented at Vivatech 2018. Only one large company stand in the sector (Matmut) is located, well placed near the entrance. By extending the thinking more broadly to the financial sector, banks are also poorly represented (only BNP Paribas has its own space).

How to interpret this relative absence?

2 possible answers to this question:

  • The financial service sector has not taken the measure of current or future changes
  • Vivatech 2018 was not perceived as “the place to be” to promote the ongoing transformation: too expensive, poorly targeted public, etc.

In both cases, I wonder! Vivatech is now “The place to be” in terms of innovation, whether for the pros, but also for the general public, come in number Saturday. Insurers are not reputed to be the forerunners in innovation, it does not seem inconceivable to want to highlight its steps in this type of salon. From there to think that we are rather in the first option, I dare not think about it!

Startups side

Startups that intervene around the world of insurance were present, but in relative numbers. They are often invited by incubators or schools that wear them. Beyond the interest of each of these solutions, it is difficult to reconstruct the coherence in all this.

A burst of identical solutions

In terms of innovation, because this is the subject that interests us here, several points are worth noting.

A categorization into 3 families

The majority of start-ups present for the financial service sector can be categorized in 3 families

  • Those that improve data collection
  • Those who work on data analysis (often with the application of a business layer)
  • Startups that specialize in the action and application of solutions from the analysis

These are the axes of analysis that I use in my insurtech observatory and which are here again confirmed. So thank you to BCG for the initial reading that I have taken (and improved!).

In other sectors of activity, startups complete this vision with material technological innovations (aeronautics, robots, 3D printing), but which have few uses in the insurance world (at least in the first reading, but we’ll come back to it maybe later!).

Burst

The principle of startups is to start an activity thinking to solve a problem better than others.

The difficulty is that the first steps to climb are the same for everyone, and that the true value comes next. Thus, the startup landscape is extremely fragmented, in France, but also abroad. Many structures offer equivalent solutions, not to say the same, with exciting promises for the future. However, each one wishing to control its value, one observes a burst of structure whereas the force would come from a union to advance more quickly. For example, in these startup unions, some teams could focus on common application bricks, while others would be focused on application research. They would still be agile, but above all stronger and more able to bring the true value they promise.

In short, Vivatech 2018 is for the diversity and comprehensiveness of the solutions presented. However, I remain on my hunger on my scope of activity

Cap Gemini – World insurance Report 2018

world insurance report 2018

Cap Gemini and Efma published their annual report World Insurance Report 2018 last week. This report is usually the occasion for an interesting overview of what is happening on the market. I wrote an article on the 2017 version of this report . What should we remember from this edition?

Highlights of Cap Gemini’s World Insurance Report 2018

Because of the length, the article is separated into 3 pages, for each of the chapters.

If the results of the study provide welcome figures, the content of the World insurance report 2018 is unfortunately very clutter and does not really give proper reading to explain the situation.

Accelerate digital transformation

A necessary catch-up?

world insurance report 2018 Insurance ranks third in the customer experience score ranking ( Note: no explanation is provided on the measurement of this indicator ). This figure looks very good. On the other hand, as soon as one looks at the positive customer experience score, the result deteriorates. This is particularly the case when comparing the results with the banking sector.

world insurance report

It therefore seems clear that insurance needs to catch up on these issues. For example, the report cites the best ability of banks to leverage technology to benefit from customer touch points. ( Note: Certainly, but it is undeniable and well known that insurance has a natural deficit of points of contact with the bank, the stakes are not the same: for the bank to exploit, for insurance generate them … ).

By pushing the analysis on the satisfaction around the essential services, a significant difference appears on the simplicity of use: 36% of satisfied compared to 47% in the bank! The gap is also important in terms of speed of service.

world insurance report 2018

Regional variations

Regional variations exist, especially if we compare the levels of satisfaction between Europe and North America. If the French are eternally dissatisfied, this is not the case for all Europeans. The gap is also important enough to attract attention!

world insurance report 2018

Digital is a lever to break the traditional boundaries of customer interactions

Communication via digital channels is now well integrated, and it is now the mobile that is gaining importance! 40% of respondents believe that a mobile application is an important channel.

world insurance report 2018

Among the arguments invoked, that, classic ease (because common to many other uses of everyday life) and the other newer on personalization and individualized services.
The adoption of digital is an essential factor and opens new horizons for insurance. First, it generates an increase in the number of touch points. This creates new business opportunities. The new services that are associated with these uses are also an opportunity to improve the acquisition and retention of customers.

Proactive

There is room for improvement on the proactivity of insurance offers! Where there is often question of whether the insurance is too much or not enough for its customers, the answer is clear!

world insurance report 2018

Going even further, the proactivity of the insurer has a positive impact on the satisfaction of policyholders [/ inlinetweet].

world insurance report 2018

New challenges as technology advances

There are many examples of GAFA or other large multinational incursion tech in the perimeter of the financial sector. Insurance is one of the recurring targets of Amazon, Apple, Alibaba or Alphabet (Google). This type of competition requires traditional players to change gear to transform themselves by accelerating the pace. Indeed, more and more insureds say they are ready to take out a contract with giant tech. They are 1/5 to position themselves as such in Europe and 1/3 in North America and up to 40% in Asia and 50% in Latin America!

world insurance report 2018

Finally, if security issues are still in everyone’s mind, policyholders are increasingly willing to share their data in exchange for personalized services and additional values.

world insurance report 2018 world insurance report 2018

To conclude, the propensity to switch from a traditional insurer to a tech company can be analyzed from a demographic point of view. Indeed, some groups are more favorable than others (technophiles and generation Y), due to a customer experience deemed insufficient. ( Note: This is the beginning of adoption by early-adopters ) world insurance report 2018

The technical challenges of personal telecare

téléassistance

I had last January opened my blog to anyone who wanted to shed light on one aspect of insurance innovation. Catherine Marquèze from InfleXsys and Boris Dumontet from Vitalbase were kind enough to take on the game of writing! They offer us here some elements of understanding around telecare, which completes the article published few months ago on VA²CS . I publish their text almost unchanged, hoping that you find here as much value as me! Thanks to them! Continue reading “The technical challenges of personal telecare”

Press review of April 17th 2018

revue de presse du 17 avril 2018

Here is a little overview of articles that caught my attention and deserve to appear in the press review of April 17, 2018!

Subaru offers 3 years of insurance

Links: DecisionAtelier.com – Subaru offers 3 years insurance.

Those who read me regularly know that I often talk about a decomposition of the value chain to come. Indeed, I believe that it will be necessary tomorrow for insurers to go further in their response to the needs of their policyholders at the risk of being supplanted in the commercial relationship. The example above is symbolic for me of this situation! Subaru, automaker, intermediates the insurer in the proposal of a motor insurance. This is obviously not new, but it raises again the question of the role that can play the trademark of the insurer in this if it no longer assumes the distribution to the client.

The blockchain is dead, live Hashgraph

Links: Article from Journal the net – Hashgraph .
When it comes to blockchain, it happens quite quickly that we fall back on the technical difficulties of scalability and performance. A new technological solution would make it possible to overcome a number of these constraints. The proposal seems interesting and the subject promising, but we are obviously still far from a concrete applicability. All you have to do now is read white paper to get an idea ( Note: I have not read it yet! )

When call centers predict customer emotions

Link: ZDNet – When call centers predict customer emotions

There is a lot of talk about affective computing or how artificial intelligence could move us on the path of emotional intelligence. However, so far, few reliable sources allow to see more clearly what happens. We knew the solution of Affectiva , we can now add Cogito. This solution is based on sociometers, developed by an MIT team. It’s about detecting subtle signals in speech, tone and body language, regardless of the words used.

Solar panels, a puzzle for firefighters

Link: XLCatlin- Solar Panels

Innovation in insurance is not only new technologies that come to transform the business, they are also new risks . We talk about cyber risk very often, but here’s another, quite unexpected, but still difficult to manage.

Make car insurance “cool”?

Link: Karl Heinz Passler – My 10 innovative ideas on making motor insurance cool

Karl Heinz Passler is one of the leading influencers in the insurance innovation market. He is very active on the social networks , and a little less frequently on his blog, but the article above presents some often simple ideas for boosting car insurance!

Landscape insurtechs – February 23rd, 2018

landscape insurtechs

The update of my landscape insurtechs goes on with 14 additions on February 23rd, 2018. You’ll find the update here. There are now 150 startups documented, from 21 countries.

Additions to the landscape insurtechs on February 23rd, 2018

Newcomers today:

  • RiskGenius: Using artificial intelligence to better categorize the content of insurance policies, ensure a better reading and facilitate underwriting operations.
  • Go Bear: Price and quality insurance product comparison engine, enriched with a scoring system.
  • Codeoscopic: Provider of digital solutions dedicated to the insurance business, Multi-pricing motor, Risk manager dedicated to Solvency 2.
  • Gistek Insurance solutions: Set of software solutions to facilitate the management of insurance contracts or claims, Automation of processes.
  • Numen: Provider of digital solutions dedicated to the improvement of the insurance process and the management of the triangles of claims.
  • Satisfi: Exploit customer data to automatically make recommendations through automation, artificial intelligence and robots..
  • Captricity: Exploitation of the data to increase sales, reduce processing cycles or offer quick subscriptions without losses on the quality of risk analysis.
  • Ideeo: Brokerage of insurance contracts, Compensation defined with the applicant.
  • Addon-ACS: Behavioral analysis in real time of the consumers, during the course of care, Prevention, Improvement of the course of care via a scoring of the practices.
  • Aukazou: Damage management Water damage on behalf of the insured.
  • Assurup: Insurance dedicated to the specific needs of startups.
  • Wizzas: Co-design of customized insurance products to cover the needs of communities, Community building, Search for insurers to bear the risks.
  • Guard Time: Blockchain solutions to limit fraud and improve trust and automation of decisions.
  • Boundlss: Using chatbot and artificial intelligence to encourage improvement of lifestyle behaviors, Increased engagement with policyholders.

Contact me if you still don’t appear in the landscape insurtechs!

Matteo Carbone – 4P’s of insurtechs

4P's of insurtechs

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.

Telematics

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.

4P's of insurtechs

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.

4P's of insurtechs

Finally, the figures it presents show that attrition will be lower with telematics than without (11% instead of 14%).

In short, that positive points!

My conclusion

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.

On the Telematics side, I am also convinced of the short / medium term prospects for the subject. I invite you to read again my note on it . Let’s discuss if you want to consider a deployment!