“In our first year of activity, the focus of insurtech was on the disruptive power of startups compared to a very conservative sector; in the second year, we started talking about collaboration, startups and companies understood that together they could work and generate value in the entire value chain; In the last year we have experienced another change, since the insurtech industry is more and more focused on helping companies to innovate beyond the existing value chain, leading them into new sectors. Today’s question is: perhaps ”insurtech” is now a narrow term?”
This is how the report by Startupbootcamp Insurtech and PWC is presented. It is dedicated to taking stock of the sector and indicating current trends, drawing conclusions based on the experience of the accelerator over its three-year activity. Extremely relevant experience: 50 startups accelerated out of 7000 viewed; 140 partners (venture capital, insurance, banking, advisory); 300 PoC realized with partners; 950 investors involved worldwide; 45 million investments collected. (here an explanatory video)
In the introduction to the report, this year, 61% of the startups applying to join Startupbootcamp came from sectors other than insurance and the acceleration programme itself has taken a new turn. While 75% of the startups accelerated by Startupbootcamp in 2016 were clearly within the insurance industry, 80% of the 2017 selection operates outside such industry; totally independent from insurance, but confident to work with it.
The up-and-coming background is now that of an ecosystem where related industries join together to provide a better and more valuable service to insurers and their customers. Among the relevant industries involved there are agriculture, health, cybersecurity, sharing economy, asset management and transport. Such partnerships also offer companies the opportunity to develop further in a damage prevention approach, 80% of Startupbootcamp partners interviewed consider that the future of insurance is in terms of prevention.
“Three years ago, there was talk of new companies disrupting traditional insurers. – said Jim Bichard, PwC – Now there is talk of startups and companies that work together to create significant partnerships. All parties are working together and learning from other industries to solve problems in the insurance industry and react to world’s changes.”
The report, available here in full, also highlights other indications:
– Startups can provide access to new data sources or new ways to manage data value: Artificial Intelligence is the core technology for 41% of Startupbootcamp applicants. The problem of integration with existing insurers’ technology is overcome by several companies adopting the approach of creating a completely new technological infrastructure that will allow easy integration of third-party connection systems.
– Insurers and start-ups are increasingly looking for new products: 84% of SBC partners surveyed said to be interested in finding an innovative solution in cyberspace and 80% are interested in business models related to the sharing economy
– Many companies now need to go beyond experimentation: they are now working on how to scale their PoCs into wider activities
– The disruption is not over: even if the startups are looking for more collaboration rather than conflict, the new threats for the Companies will come from the giants of technology, telecommunications and other sectors. Startups will be precious partners to face these new threats.
Startups, therefore, are still crucial to the innovation and digital transformation of the insurance industry. What will lose importance, according to the report, is the term “insurtech” (or startup insurtech, ed. note). Since the focus on technology and innovation is now an essential part of the insurance business management, the idea of independent insurtech startups will become obsolete, as the concept of having a digital strategy insulated from the overall company strategy. InsurTech will instead become an ecosystem of innovation in and out of the insurance industry, with insurers working with a range of partners in and out of the industry.