Nick Lamparelli joined Gilad and the InsurTechLA community for an unscripted InsurTechTalk. In this broadcasted event, Nick was in the interviewee's seat. We had the opportunity to learn about Nick’s day job and dive into flood insurance and how to build insurance programs.
The 1996 movie ‘Scream’ taught us one thing: Don’t answer the phone! And much like the characters of that movie, so to insurers should heed this advice when engaging with Millennials.
A startup has a life but the people who breathe life into it…, well, they usually don't.
People like the idea of a startup. It is romantic. The excitement diminishes when they find out the extent of their responsibility and compensation. Basically, most people really want to work for Google. Google is a multibillion-dollar behemoth that has all the risk management tools and processes to support it. And yes! They still have all the perks and cool parties at the end of Google I/O.
The entrance of startups to the insurance industry, nearly four years ago (2015), introduced a change, innovation, that made all the components, whether they are linear or passive, to react. The new teen spirit that the startup introduced acted as a step function that increased the value of the industry. The input may be a nice and clean function. It has a ripple effect that affects the entire pond until is converges on the new and higher level.
Uprise.co is breaking new ground in removing the stigma attached to mental health. Paul Muir interviewed Uprise CEO & co-founder Jay Spence.
"An insurance policy that excludes on the basis of mental health is neglecting to recognize that this is a person who has been categorized as having something that is temporary rather than permanent."…
Insurance companies take active steps towards modernization to keep up with customer's expectations and recent entrants to the insurance space who use the latest technology. Carriers introduced new entities into their organizations to champion and facilitate progress. Today there are innovation teams, innovation labs, venture arms, accelerator programs, and the less familiar function -- the Entrepreneur in Residence (EiR).
To understand better the avant-garde insurance that is done by the large insurance companies and their innovation programs I reached out to the leading insurance innovation teams.
Here is a short interview with Dominic DiMarco, EiR in QBE insurance, the man that claims to have the best job in the insurance industry.
"All the big businesses are trying to figure out how to do things "faster, quicker, easier and leaner" and they don't have those skills in their four walls to do it themselves most of the times."
"There is a difference between the IT infrastructure and core systems to the innovative work that is happening on the fringes. You can't replace a core system at once."
"Insurance companies, at their core, are massive financial institutes."
Cyber Insurance is among my InsurTech trends predictions for 2018. The attention Cyber insurance receives has increased in the past year in the wake of media coverage of cyber attacks and Trump administration.
To better understand the opportunity in the Cyber insurance products I would like to share with you an interview with Nir Perry, the CEO and founder of CyberWrite, a company dedicated for the development of cyber insurance technologies.
2017 has been an interesting year for InsurTech. I would define it as the year that InsurTech took another step from adolescence towards adulthood. I define "adolescence" as the time that the youth exhibits exploration, rebellious and self-definition behavior. The players in the industry are still figuring out the rules of the game, they are defining the frameworks and the majority do not know what to do with it all.
My dear friends Shefi and Avi from Coverager gathered the following information on investors and investment in the global insurance industry. For additional information and segmentation by continents. Checkout Shefi's article.
The investments' volume is stabilizing similar to the trend that we witnessed in FinTech (a CBInsight graph should be here.) An interesting fact is the amounts that the investors put into the more established companies such as Lemonade and DataRobot and the brand new startups. Why is it interesting? Very simple, SoftBank invested $120M series C in Lemonade and New Enterprise Associates invested $67M series C in DataRobot. Both investors understand the cost of doing business in the insurance industry and each investor has an investment strategy. Take a look at SoftBank's portfolio here. Lemonade needs the capital in order to grow as an insurance carrier to new territory leveraging its scalable core system, and DataRobot needs to expand its enterprise sales force.
The insurance companies and the reinsurance companies took several steps forward as well to embrace the change and opportunity that the newcomers bring. One indicator was the number of participants at Jay Weintraub's ITC2017 conference. 3,800 attended the conference, double the number of the ITC2016 conference. Another indicator is the increasing number of venture arms. In 2015, the European insurers had the lead with AXA, Allianz, and Aviva who created a venture arm and XL Catlin as the only US-based insurer with a venture arm. In 2016, additional US insurers founded their venture arm Nationwide $100M, Liberty Mutual $150M and Intact (Canada) $200. In 2017, Northwestern Mutual launched its venture arm and many others got the spotlight, for example, RGAx, Aflac ventures, and BlueCross ventures. Others increased the size, scope, and talent of their innovation team e.g. AIG.
We can't ignore the buzz words and trends that shaped 2017 tech world. I think that we can all agree that AI, blockchain, bitcoin, ICO, and bots were the 2017-Q3 Q4 buzzwords that eclipsed the Q1-Q2 buzzwords predictive analytics, big data, and customer engagement. Bear in mind that in many insurance companies the phrases "digital transformation", "agile", "mobile first" etc are work in progress and the mid-size agencies, who are a major player in the distribution channel, are not digitized as they should.
Not everything is Distribution or new insurance products. The SaaS, the DaaS and the smart compare engines that have done well. We can't go without mentioning CrapeData, DataRobot, PolicyGenius, and BoldPenguin.
There are new and exciting hardcore technologies coming out from innovation centers and from the Cyber powerhouse Israel. The space is not defined enough for an underwriting, pricing and the standards that can provide significant recovery through the claims process. In 2018, we are going to see new insurance products that can address the combined risk of system and human. We are at the start of cyber insurance.
No, blockchain will not fall -- the excitement will wind down. The engine that drives the research and searches for revenue-driving applications will continue. We going to witness additional institutes (research and consortium) that will help the carriers to improve on internal processes.
In 2018 we are going to the chatter around Smart Cities. Why? Because Singapore, Dubai, Amsterdam, Barcelona and other cities are exploring the concept.
A smart city is an urban area that uses different types of electronic data collection sensors to supply information which is used to manage assets and resources efficiently. --Wikipedia
Insurance will benefit from smart cities in the future. Safer urban areas, better risk management, and easier CAT assessments. In the meanwhile, it is important to observe the IoT operation that will power the Smart City and the cyber security + cyber insurance that it may require.
No, unless you don't have one.
Application Programming Interface (API) is THE 2018 prediction for me. Carriers know that the marginal cost of adding another "digital agent" can cost them millions if they don't have a modern API management system. Insurance companies want to work and receive business from the new InsurTech startups who registered as agents in all 50 states and with the agents who digitized their own business.
The core entrepreneurs of the insurance industry. The agents will have two paths to take (i) evolve to an InsurTech agency (ii) buy InsurTech services to make their agency more productive and more efficient. In 2018, the agents will be the buying force of InsurTech products.
In 2018, InsurTech startups are going to enter new stages of a venture's life cycle. Scale - startups are going to invest their series A and B and scale their operation, customer base and revenue. Acquisition - for market segment, technology and talent. Dissolve - because they had the wrong product, the wrong team, the wrong business model, or that their competitors were better.
On Tuesday, January 10th 2017, Daniel Schrier from Fjord, an Accenture company, joined the InsurTech Los Angeles Meetup group for a conversation about design thinking, innovation trends and opportunities from a design and creative perspective. Daniel's talk covered a lot of ground and left the audience with many questions that we hope to cover in our future events.
Today, customer brand loyalty is low. One of the challenges companies face is meeting customer expectations. The reason is that companies assume that they meet customer expectation by measuring customer satisfaction, usually by extrapolating NPS and tNPS scores. It is hard to measure the gap between expectations and satisfaction. Where there is a challenge there is an opportunity. New InsurTech companies take on the challenge of meeting customer experience expectations. They do that by observing the popular non-insurance applications e.g. Uber and applying the UX principals to an insurance application.
Machines and Artificial Intelligence will be the newest recruits to the workforce, bringing new skills to help people do new jobs, and reinventing what's possible.
The first step, before we jump into the "smart" and the AI, is simple automation. I find that there are many opportunities to automate the tools and help the workforce. The insurance space is composed not only of agents, adjusters, underwriters, actuators and customer support but also of marketers, engineers, operations, IT support and much more. Products that can increase an agency efficiency, or call center turn around, will provide value to the industry.
Insurance companies must look at technology not only as a disrupter but also as an enabler. The technology will enable to transform the people, projects, and organization into a highly adaptable and change ready enterprise.
The strategic use of technology to create platform business models is driving growth opportunities is the rapidly expanding digital economy and for insurers.
Fast emerging digital ecosystems create the foundation for the next big wave of enterprise disruption in insurance.
Forward thinking insurance companies have the line of sight to redefine their role and positioning in the market. Today there is an opportunity, if not a need, to change how carriers create and deliver insurance products. In future posts, I will address the value over and position of the new InsurTech companies Lemonade, Trov and Metromile.
The survey above raised several questions during our conversation with Daniel. One of the questions was "83% of insurers recognize that IoT will introduce change to the industry. Yet, only 51% of insurers plan to pursue digital initiatives with new partners. Are the insurers planning to grow IoT capacity in-house? Work with old partners? Or, ignore it completely?
