Bitesize InsurTech: H1 2017 review
June 30, 2017 Chris Sandilands
Bitesize InsurTech is a weekly email from Oxbow Partners that profiles an InsurTech business and provides some analysis of its market or business model – all in under 400 words. It’s been going since April 2016 and we’ve now covered over 60 InsurTechs from around the world and operating in all parts of the insurance value chain.
In this blog post, we have summarised our coverage of H1 2017.
We started the year with RightIndem, a claims platform that is digitising and automating the motor claims process. They have been making waves since graduating from Startup Bootcamp 2016 and have announced numerous pilots with insurers around the world.
We then updated our coverage of Lemonade, the posterchild of InsurTech (which we first covered in 2016). (We included two pieces about Lemonade on our regular blog in June as well – one analysing Lemonade’s trading numbers and the other arguing that Lemonade could be more relevant for brokers than insurers.)
A prediction we made in our Bitesize blog post was that Lemonade would drop its peer-to-peer angle in 2017 – and they obliged just a few days after we published our January update post. We don’t think peer-to-peer really works in insurance. Nonetheless, we covered another peer-to-peer insurer, Britain’s Guevara, a few weeks later.
Our next startup was Bought By Many, where we timed our profile to coincide with the announcement of their £7.5m investment by Octopus Ventures, Munich Re and others. Bought By Many are a digital broker trying to transform the personal lines broking space with personalised propositions. We covered Munich Re’s Digital Partners division, which we helped to build, a few weeks later.
We are on the record (Bitesize, FT) for being sceptical about Blockchain’s short-term impact on the insurance industry, but we are still interested in startups trying to find a use case for it. ChainThat uses blockchain to record all events that occur during the insurance placement process in an open ledger, giving all parties access to identical records.
In February we covered two telematics companies. First we looked at Amodo, who collect driving data via smartphones to provide insurers with greater insight into customer risk exposures. We then covered PitPat, who provide “Fitbits for dogs” and give their owners, and potentially insurers like investor RSA, insight into just how healthy one’s dog is.
We rounded off February with a look at PolicyGenius, a US-based personal lines online insurance broker. Interestingly, the company is eschewing buzzy marketing around AI to focus on building an “easy, honest and informative” online customer journey – this seems to be working given they have raised over $20m since launch in 2014.
In March we moved into data and AI month – a series of four themed Bitesizes.
Risk Genius use AI to automate the creation, comparison and review of policy documentation for brokers and insurers. Tyche use AI to improve liability underwriting and Carpe Data focus on structuring various data sources to improve underwriting insight and identify fraudulent claims. Emerge Analytics build models for insurers to use their data better.
These companies are helping insurers in three different ways which we identified in our AI primer: more targeted distribution, more accurate underwriting and improved operational efficiency.
In April, we moved on to German startup month. Germany and the UK jockey for the accolade of being Europe’s premier InsurTech market – data from CB Insights suggests that Germany accounted for 6% of global InsurTech deals in 2016, just slightly more than the UK’s share.
We covered a range of businesses: online broker Grün Versichert, who provides a “green” proposition, claims AI platforms MotionsCloud and Cognotekt; and Liimex, an online SME broker.
Liimex segued nicely into SME month in May. SME seems to be getting more attention ever since Traveler’s $490m acquisition of Simply Business earlier this year.
We covered Next Insurance and CoverWallet from the US, Assur’up from France and the UK’s Konsileo. It’s interesting to note that Union Square Ventures, the New York based VC, has invested in CoverWallet. USV have had a $1bn exit every year since 2011 so must see potential for serious disruption in this market.
We ended the half year with life insurance month. There’s much less activity in life than non-life – our database suggests only 4% of InsurTechs are focused on life. That said, Gryphon, a start-up life insurer, announced a £180m investment this month so we immediately picked them up in our coverage. We also looked at MyFutureNow, also a Startup Bootcamp graduate focusing on pensions consolidation. Certua, a robo-advisor for life insurance and Atidot, an analytics company similar to Emerge Analytics (see above) completed the series.