Insurance Nexus organizes an event around connected insurance on June 11th in London and publishes a white paper to support it named “IOT is just a technology“. Continue reading “Insurance Nexus – IOT is just a technology”
Key points to remember about UBS insurtech Shifting Asia
- Asia is one of the least insurance-covered markets and there are huge catch-up prospects
- Insurtechs have the opportunity to transform this market more than any other. They could generate, for example, up to $ 300 billion in savings by 2025.
- Competition is tough on the continent and forces to improve the quality of service as well as to find differentiation criteria
- Customers are going to be the big winners of the arrival of insurtechs.
- Incentive prevention actions could lead to significant effects on risky portfolios and thus significant improvements for the benefit of society.
Oxbow Partners is a UK-based consulting firm dedicated to the world of insurance. More specifically, they are specialized in topics that are changing the world of insurance, through 3 entry points: strategy, digital, and M&A. They just released a report called “ The 25 insurtechs Oxbow 2018 ” .
I share the point of departure of Oxbow Partners, according to which there is no reliable criterion of comparison of insurtechs currently.
Some are interested in raised funds. However, I think financially speaking, raising money is not necessarily a positive criterion for a startup. Indeed, if it is necessary to pass caps, it can mean that it can not finance its growth alone.
I decided to classify them according to their contribution to the business value chain, but it is just as debatable because I do not take into account their economic sustainability.
In short, Oxbow Partners made its selection according to the following criteria:
In addition, they take up a concept now commonly accepted: insurtechs today are not only distributors (B2C), but are facilitators or accelerators in B2B.
Last interesting element, represented under the diagram below, they consider that after the abandonment of a phase of competition, in favor of the collaboration between big groups and insurtechs, one should see reappearing soon a competition of another kind . This could be explained, according to Oxbow Partners, in the event of insufficient commitment by insurers.
Selection of 25 insurtechs Oxbow 2018
The selected startups belong to 4 categories:
- Distribution: These players are looking for end customers and need insurers or reinsurers to provide them with products
- Data & analytics
- Claims and fraud
These last 3 categories are actors who need insurers as clients.
Here is the selection presented differently.
The last pages of the report present a summary in 1 or 2 pages for each of the selected solutions.
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
- 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!
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”
Insurance Innovators (an offshoot of Market Force, which I had already talked about here for their report under the same title ) has just published the future of insurance 2017 (Future of General Insurance Report 2017).
7 themes are discussed (for a better readability I separated into several pages):
- Innovation and Disruption
- A changing regulatory environment
- The future of underwriting and pricing
- Value-added services
- Touch Millenial Generation
- Insurance in the Age of Machine Intelligence
- Fraud in a connected world.
Written in partnership with the Chartered Insurance Institute , and sponsored by IBM, Sas and Smart Communications , this report is generic, but of quality. Market Force believes that insurers are poised to innovate and transform to keep pace with insurance companies, but the pace of transformation is still too slow. A tip: Act now! Continue reading “Insurance innovators – Future of insurance 2017”
Deloitte published in November 2016 a European study on car insurance entitled The growth of connected cars insurance. This study is carried out for the second year in a row on approximately 15,000 consumers and in 11 European countries (Austria, Belgium, France, Germany, Ireland, Italy, Poland, the Netherlands, Spain, Switzerland and the United Kingdom) .
Briefly, Deloitte believes that these products are promising, that customers are ready, and that it remains to work the business model by moving towards services. One of the main elements to remember is the notion of service platform, presented at the end of the study .
Current situation of the European market
Deloitte presents the figure of 97 billion euros for the size of the European market (premiums issued) of motor insurance in 2015. They also present a potential of connected cars insurance by 2020.
Three lessons are to be remembered:
- Overall, the potential is 17% (or € 15bn) of connected cars insurance, with two countries far ahead: Italy (see Swiss Re case study on this topic ) and to a lesser extent the UK. These two countries have a potential of respectively 27 and 23% of their market. Note, in Italy, there are already 4.5m insurance policies concerned.
- The study shows a significant change between 2015 and 2016: the intention to change insurer increases more than 15% in Europe. For the authors, this indicates a transition towards a more volatile market, and therefore a necessary transformation. (Note: In France, we observe it through the consequences of the law “Hamon”)
- 28% of respondents are willing to share their data with their insurer. At the extremes, France and Germany were the most cautious (27% and 25%), and Belgium, the most interested (40%).
Short summary sheets are presented by country and make it possible to explain specific local situations.
While insurers do not always have good press, customers are nevertheless rather ready to share their data with them. Insurers have a relatively better image than many other types of actors.
In an increasingly standardized, competitive and fluid market, this shows the appearance of a momentum for insurers. It could be interesting for them to exploit these good conditions to position themselves in this market and thus set up criteria differentiating from their competitors.
Nevertheless, it’s impossible to talk about connected cars insurance without talking about analyzing and processing the data collected. It is therefore a question of organizing the transition to more big data in order to benefit from real targeting skills.
Which potential customers?
6 categories of customers are identified by the study, with a very different interest towards connected insurance contracts:
- Segment of curious elderly policyholders
- Faithful elderly
- Refractory aged insured categories
- Versatile young people insured
- Young faithful insured
- High-Premium Insureds
If these categories deserve a little refinement, they already allow the authors of the study to make an international comparison.
What motivations for underwriting connected cars insurance?
Several scenarios were proposed to the respondents.
Consumers appear much more likely to share their driving data than data from social networks. In addition, as expected, price reduction is the main motivation that can encourage sharing of information. On the other hand, the provision of complementary services is well reflected in the expectations of customers.
The study then presents two interesting visions showing the correlation in the valuation of services and the confidentiality of data, first by country, then by population segment.
We will note here different profiles for the two most advanced countries (Italy and United Kingdom).
Is connected automobile insurance, in addition to an opportunity for differentiation in the market, the opportunity to renew or develop the service offer. This is what the authors of the study think.
Categories of Services
3 categories of services were studied:
- Automotive related services : troubleshooting assistance, theft notification, etc.
- Non-automotive services : geolocated promotional offer, etc.
- Data analysis and driving behavior services : Travel and expense information, comparing driving with friends, etc.
Respondents then had to indicate whether they would agree to share their data in order to benefit from one of the 17 services offered.
4 services are therefore clearly of significant interest (more than half of the respondents would be willing to share their data):
- free troubleshooting assistance
- automatic assistance in case of emergency
- theft notification / tracking of stolen vehicles
- free oil change or vehicle maintenance services
These services (in relation to the automobile) could then serve as levers for insurers in order to gain maturity on the other 2 categories of services.
Case / smartphone application
Finally, the study shows a preference in almost all countries for a box installed in the vehicle rather than a smartphone application. A nuance is to be brought: the versatile young insureds show a rather opposite behavior (54% of preference for the application). As it is in this segment that there is a strong potential for development, this nuance is important!
As the choice of equipment is fairly structuring, insurers will have to choose the segments of the population they want to target as a prerequisite for any approach.
The usual worries of the insured are not excluded from this study.
The issue of transparency in the use of data is therefore essential. In addition, three approaches are to be taken into account by insurers to integrate social responsibility issues:
- ethical dimension of data usage
- possibility to feed a new type of relationship with the insured
- taking into account real risk prevention / loss reduction.
In the end, it should be clear to insurers that the data collected should be used for risk reduction and not just for risk selection. We find clearly in our study that the assessment of services is related to security issues.
The service platform
One of the main elements of this study is the notion of service platform. Insurers have the opportunity to move from a value proposition focused on claims management to a wider range of services around the mobility experience.
Connected cars insurance could be the product that will allow the insurer to renew its relationship with the insured, adding more frequent touch points.
This implies for the insurer to be interested, beyond tariff benefits, in the entire ecosystem of car insurance. More specifically, the insurer will probably have to participate more deeply and invest these new segments to reinvent the user experience.
The choice that presents itself is simple for the insurer:
- Either do nothing and take the risk of being overwhelmed by new players that will spill over into its business segment
- Either position itself as a service platform, which will allow the insured to access an ecosystem of partners.
The experience of a few players in other markets (eBay, Uber, TripAdvisor, etc.) shows the potential of such an economic model. These entities are indeed able to operate light and flexible structures that adapt quickly to the needs of consumers.
Auto insurance is already mature enough, and offers a clear environment. This will surely be one of the first branches for which we will have to reinvent the operational model. The first to launch will have a certain competitive advantage.
Deloitte is presenting a proposal for a range of services that could be addressed.
An example given by Alexandre Lebrun of Facebook at the Insurection event brought up a subject that I wanted to discuss here. This is the need for insurers to start thinking about insurance products redefinition.
The example quoted is the following:
- Alexandre Lebrun consulted the patent plans for the first washing machines.
- It was then a question of proposing a technical tooling which made possible to reproduce by the machine the manual action carried out in the antique laundry
- It was only afterwards that the industry modified the plans to adapt the washing process to what the technology could do more efficiently (the inside rotation that we know nowadays).
Technological change or innovation brings new solutions.
As a first step, it is a question of using the new technology to make more efficient the actions carried out previously. In other words, it is about consuming fewer resources (time, money, people) to achieve the expected objectives. For example, technologies such as RPA open up horizons for automating recurring tasks. So it’s about doing the same thing as before, but doing it better.
Another level of analysis is open with the surge of new solutions coming to the market. Like the washing machine, it becomes necessary to reinvent the insurance business and the way to realize it to adapt to the technical possibilities.
Attention, it is often said in IT projects that we must be careful not to be too influenced by the tools to not constrain the framework of expression of business needs. But the current business teams are themselves often constrained by a historical framework of thought that is not always relevant. Business need is therefore as this watermelon, constrained in its mold.
The arrival of new tools, or new technologies must therefore be a pretext for an opening of borders, the extension of the horizon of possibilities.
Focus on the impact on supply: towards an insurance products redefinition
The assumption expressed above may have impacts in many aspects across the entire insurance value chain or business processes. However, I want to treat it under the axis that seems to me the most striking: the products!
A Standardized Offer Policy
Insurance has always been very product-oriented: a car product, a home product, a health product, an additional health supplement, a borrower insurance, etc.
In each of these products, the offer has become standardized, sometimes subject to regulations, sometimes under the influence of the market which is stabilizing and becoming standardized.
So we see products appear, all very close in terms of covers and exclusions, the comparison is not easy. Although initiatives here and there exist to simplify the terms and conditions, we still see exclusions against the fission of the atomic nucleus or this kind of thing (in French sorry, but the same examples may exist in english):
It is not useful to say who are the insurers concerned, everyone, in his own terms & conditions, can find this kind of fomulation.
First impact of innovation
As we have seen above, innovation aims first and foremost to improve the current way of doing things.
The companies then call on insurtechs considered as “enablers”. These are intended to enable better management by reducing irritants, streamlining processes or improving operations.
Take the example of auto products, and claims management. All insurers have long sought to improve their process.
In that objective, they were able to deploy:
- Process Improvement
- Implementation of dedicated management tools with complete workflows
- Deployment of solutions for teleexpertise
- Opening of selfcare services
At this stage, it is not a question of modifying the products, but of adapting the context that goes around!
2 nd impact of innovation
Where the exercise goes further is that innovation imposes a new way of thinking.
On the claims management, to go further, it was necessary to automate the settlement of claims.
The first option was to speed up all operations, but that was not enough. For some time now, automatic payment solutions have appeared because of modified products. I am thinking here of parametric insurance, for example:
- Weather insurance: if it rains more than a certain number of mm of water over a certain period of time ( as in this SwissRe contract in HongKong ), the conditions are met for an automatic claims settlement.
- Cancellation Insurance / Flight Delay: Several solutions have recently been deployed. If a cancellation is announced, it is possible to adjust the loss automatically.
This involves two new elements:
- A data feed, which is not structured today: Meteo France does not yet allow a systematic provision of forecast information or weather observations, companies or airports do not publish all the time via interfaces / API flight data.
- The structuring conditions of the products must be adapted to these new rules.
Products as they exist today leave too much room for interpretation and therefore require human intermediation to be treated. Who says human, says subjectivity. When we add terms & conditions and very numerous exclusions, we get a lassitude of the customers and the famous phrase: “the insurers are all thieves! “. At this level, there is no question of a lack of security, just an offer that does not voluntarily cover the complexity of the needs of insured, to achieve controlled price levels, on the one hand and profitability, on the other hand.
Policies to cover needs
Thus, three progressive consequences are to be expected from the innovation on the offers of the insurers.
- A simplification of the products,
- An objectification of the products,
- A coverage of needs, rather than standardized products.
Gradually, the general conditions of 30 to 60 pages should tend to disappear. The goal is not only to express the same thing more clearly ( as we saw in Cardif ), but above all to remove the rules that pollute the customer experience. So it’s not so much the writing that has to be simple, but the product. Thus, there should be no question of looking for dressings in technology , but rather make confidence in the insured by a better understanding of what he is obliged to make sure!
Once the simplification is in place, it is a question of objectifying! It must then make the contract dependent on objective rules, supported by recognized third parties or formal findings! At this stage, it will be necessary to consider that a home insurance is activable as soon as a water damage has taken place, and this, whatever the reasons which triggered it (check therefore in your contracts if the overflows are covered ). A borrower insurance will be acquired, as soon as the incapacity is noted, without playing on the terms (check if your contract covers you in case of incapacity to realize “any profession” or “your profession”, just a term which changes a lot things).
In short, it will obviously cost more to cover, but the price will be offset by customer satisfaction and the reduction of churn on the one hand, and the reduction of management costs on the other hand. Moreover, technology now allows the application of anti-fraud controls a posteriori and thus remove doubts on that side.
A last level of maturity appears, via the two previous points, as well as by the new uses that appear on the market. Thus, when you are insured by car, you are insured for you as the driver of your vehicle. What about collaborative uses (you rent your vehicle on Drivy or rent another vehicle).
These needs are now covered by other insurance products. The insurance of tomorrow will surely have to cover “mobility”, and will include all your travel operations. This can be by driving your vehicle or rental vehicle, driving a bike or scooter self-service or by taking the train or plane, etc.
Home insurance will cover tomorrow the need for housing. Thus, there will be both a minimum insurance when you do not occupy places, and full insurance for where you are at the time you are there. With this in mind, Wilov’s proposal for auto insurance is interesting: you are insured all the time and only pay when you drive.
And you, what do you think of this necessary insurance products redefinition ?
PS: For atypical vegetable gardeners, molds for fruits can be found on the CoolGadget website !
On Monday, November 6th, 2017, April Group organized the event Insurection, wanted as the biggest French event dedicated to insurtechs. 300 people attended, and as part of our insurance innovation activities, I was there to represent Siltea .
Back to this day, with the key elements to remember: roundtables and startups present. Continue reading “Insurection by Group April: debrief”
Creative Specific Software has developed an innovative solution for the detection and prediction of falls for the elderly. This solution is called VA²CS.
Halfway between connected object and artificial intelligence, it allows to offer a real service of prevention of a significant risk! <! – more ->
For the record, there are in France 1250 falls per day, for 30 deaths. The need to detect the fall is therefore not new, and several solutions already exist. However, most existing solutions rely on bracelets, pendants or watches, and this, without major innovation for 25 years. The latest solutions are based on ground-based sensors and teleassistance boxes ( see the Harmonie Mutuelle solution – Orange ), but the cost remains generally important.
There are several major limitations to these solutions:
- The first reaction of a falling person is not to press a button, whatever it is, but to try to get up
- Once standing, the 2nd reaction is not to try to call for help because they do not want to disturb. The person is not going to be taken under examination immediately, with all the consequences on health aggravations in particular.
- In the event of a fall with loss of consciousness, not all solutions can automatically send help
- Most calls via teleassistance boxes are calls of convenience (against loneliness, need to talk to someone, need for psychological assistance, etc.). The average duration of these calls is almost 3 minutes.
Moreover, in the event of a trigger or an appeal, the tele-assistants have the legal obligation today to warn the helpers (under risk of not helping a person in danger). When the family is not available, this generates firefighters’ intervention costs (180 €). When we add the potential damage to the home, when it is not always relevant, because there is not always a fall, the consequences are heavy.
With this in mind, and after working with Dr. Jean-Marie Vetel, one of the designers of the french GIR grid , Ramzi Larbi and his team have developed a new solution.
This involves equipping the living area with sensors (cameras), and then, thanks to the analysis of images captured in real time to detect falls.
When it is detected, a photo is sent automatically to the remote assistance center. It takes on average about ten seconds to give a certain answer to the action to take:
- the fall is real and you have to send help,
- either there is no fall, it is a false alarm, and the alert can be closed.
The desire is to obtain a solution at a reasonable price, the offer is based on conventional cameras and a connected box that contains intelligence and algorithms.
VA²CS already has 1500 EHPAD rooms in France, within the largest networks (Korian / Orpéa), as well as 600 private individuals. A partnership also exists abroad with Tunstall, the world leader in teleassistance for the elderly. The algorithms are patented in France and North America.
Prediction of falling
In order to complete its offer, the company has worked in partnership with Orpea to identify key factors in prediction of a fall. Then, she developed the corresponding algorithms. It is now able to predict a fall with a precision of about 60%!
Implemented in testing at Orpea, this solution has reduced falls by 50%!
The solution was then supplemented more conventionally by intrusion detection coverage or facial recognition of visits to notify malicious visitors to relatives.
My opinion on detection and prediction of falls
This solution was not developed at first with a desire to meet the needs of insurers. However, it is totally in line with the current concerns of the sector.
The potential consequences of this type of solution for public health and for insurers are in my opinion significant.
Indeed, being able to predict a fall makes it possible to send notifications to qualified personnel or a relative to intervene. This is obviously valid in specialized institutions (EHPAD) to support staff reduced at night, but use cases can go further.
Thank you Ramzi Larbi for this exchange and good luck!
Note: I do not have a commercial relationship with the company providing this service.