Bitesize InsurTech: OptioPay
February 10, 2021 Chris Sandilands
OptioPay is a B2B2C platform that allows its partners to benefit from insight generated from customers’ banking data. An insurer uses OptioPay to create a rewards platform which it offers to its customers; customers are invited to permission the platform to access their banking data and in return they receive tailored offers.
The platform can be customised by each B2B partner but normally revolves around a social media style ‘newsfeed’, which displays offers and useful information. This could include:
- Offers from over 120 merchants (e.g. Adidas, IKEA, Zalando)
- Cashback from merchants, which could be credited to a customer’s life insurance policy
- Financial services and insurance offers
- News relevant to the customer, for example how to mitigate storm damage
Offers can be tailored to individuals through OptioPay’s powerful profiling engine. For example, the platform could look at spending patterns to identify customers who have children but no life insurance direct debit, or identify their approximate home insurance renewal date. An insurer can provide relevant offers to the customer at ‘moments of truth’.
Interestingly, this can be done either centrally or by agents or brokers for their local portfolios. There is the potential for a virtuous circle – some might call it an ecosystem – whereby, say, a restaurant in the insurer’s portfolio provides an offer to other insureds in the portfolio, thereby creating a revenue stream out of the restaurant’s insurance premium.
To do this, OptioPay is making use of Open Banking (PSD 2, the European Union’s revised Payment Services Directive). This requires banks to make customers’ data available to third parties via an API, at the customer’s request.
The Oxbow Partners view
OptioPay excites us for a number of reasons.
First, we love the idea of turning insurance portfolios into mini ‘ecosystems’ whereby service providers can build revenue streams from their insurance premium. Whilst many insurers are thinking theoretically about ecosystems, OptioPay provides the practical tools to create one.
Second, we see opportunities for insurers to build closer partnerships with distributors. For example, insurers could move beyond one-way bancassurance relationships to creating an additional, personalised sales channel for the bank into the insurer’s portfolio. This could give insurers a huge propositional and financial advantage in these cut-throat bidding processes.
Third, we see huge potential for this proposition in the UK where insurers are being forced to rapidly innovate their proposition due to the recent FCA Pricing Fairness review.
