Lighthouse #5
Curating the best insurance, insurtech, innovation and leadership content for you.
Ron Arnold
11eight | Linkedin | twitter
I believe you have to be willing to be misunderstood if you’re going to innovate.
Jeff Bezos
Thought Leadership and Innovation
Leadership Mindsets Need To Change As The World Of Business Changes: Business dynamics and the mindsets required to successfully lead people are changing rapidly. For senior leaders who were schooled through the 70s and 80s, these shifts can be challenging. Here are a couple of the slides I use with Exec teams and Boards that several people encouraged me to share more broadly. I hope you find them helpful. Go to slides Source: 11eight
Australia’s Support of Early-Stage Businesses Lagging: Australia is lagging the US, UK and Japan on key fintech tax concessions. Australia’s early-stage venture capital limited partnership scheme currently offers a 10 percent tax offset to investors. Similar incentive schemes in the US offer up to 100 percent tax offset for early stage fintech investors depending on the State where the investment is located, while the UK’s investment scheme offers an up to 50 percent tax offset. Early stage fintech investors in Japan are offered a 25 percent offset for investing in early-stage companies. We have some super fintech and insurtech entrepreneurs and we should be doing more to support them by improving the incentives to invest. Let’s face it, we simply do not have the depth and breadth of VC support that the US, the UK and Japan have. The tax incentive regime isn’t helping. Read more Source: Fintech Business
The Connected Car Opportunity – It’s Big: Quite a lengthy article by McKinsey looking at the opportunities from connected car data. Connected cars provide a unique customer experience opportunity for OEMs, suppliers, dealers, insurers, fleets, tech players, and beyond. To date, however, most players have overlooked or been unable to monetise data from these vehicles. According to McKinsey, seven of the ten most valuable companies in the world already generate billions in profits from data-based services. So, it would be expected that new attackers, tech companies and incumbents will work out how to exploit and scale connected car data opportunities soon.
McKinsey identifies several clusters which contain 38 use cases that could deliver $250 billion to $400 billion in annual incremental value for players across the ecosystem in 2030. These figures include additional revenue generated from services and data sales, as well as cost savings enabled by car data. Read more Source: McKinsey
Insurance
Innovation Important but Many Insurers Don’t Have An Innovation Plan: The 2020 Global Concerns Survey of insurance leaders by the International Insurance Society has found that 95 percent of executives indicated that innovation was important or very important to their business's success, but just 35 percent had an active innovation plan in place. However, 65 percent of respondents said they were definitely making technology investments in response to the impacts of COVID-19. The results are similar to some other studies. So perhaps not surprising that Accenture work suggests that insurance is one of the industries most prone to disruption. The report Source: International Insurance Society
Frictionless Insurance, Embedded Insurance, "One Click" Insurance – Is it coming? There is growing talk among some industry commentators and analysts about the prospect of true frictionless insurance. A recent example is the SlimLoan-Progressive partnership in the US. Telsa looks to be moving in this direction with auto insurance. The idea is simple. Use data and digital to embed insurance at the point of sale - integrating products directly into sellers’ platforms. Well executed this will remove the hassle of going to the insurer and having to answer a whole series of questions to complete a quote. This could be a big disruptor of the traditional insurance distribution model. Read more Source: Andreessen Horowitz
Chubb Launches Simple New PAYD Cover: Chubb has announced the launch of MY Smart Car Insurance for drivers for low mileage. Doesn't appear to be IoT or telematics enabled and includes three different plans offering cover within the annual mileage limits of 5,000km, 7,000km and 10,000km. It seems to works a bit like an insurance voucher and customers can top up before reaching their mileage threshold. Don't know exactly how they validate km's...I expect they just get the customer to take a photo on the mobile and send it through. One thing that seems really neat is if you do not exceed the km's by the end of the policy period then up to 2,000 km of unused mileage can be carried forward to the following year upon renewal, at no additional cost. That is like the rollover from unused data on Mobile Phones. Looks like a good way to test customer appetite for a usage based solutions without all the 'tech' stuff! See the video here
Open Insurance – Both Challenge And Opportunity: Data is critical for insurance. It is foundational to risk identification, pricing and product design. Insurers are typically data rich. New kinds of data and data sources, new players and new innovative opportunities are emerging. Globally, policy makers are considering whether and how far insurance value chain data should be ‘opened’. Insurers should take note of this discussion paper on Open Insurance released by European Insurance and Occupational Pensions Authority (EIOPA). It covers opportunities for Open Insurance beyond data into areas such as supervision, and comparison websites. Amongst the issues to be considered:
Policyholder rights
Proper oversight and supervision
Data protection and (digital) ethics
Interoperable data sharing framework and API standards
Level playing field and data reciprocity
Go to the paper Source: EIOPA
Premiums On Flood Prone Premiums To Rise Rapidly: The challenge posed by the increased in the severity and frequency of events is being confronted in many countries. Some new data out of the US creates some very sobering reading. The National Flood Insurance Program, which provides the vast majority of United States flood insurance policies, would have to quadruple premiums on high-risk homes inside floodplains to reflect the risks they already face, according to new modelling by a group of academics and experts that models flood risks. By 2050, increased flooding tied to climate change will require a sevenfold increase. These numbers are scary and probably similar to many countries - I would imagine the sustainability of certain insurance models and covers will be a growing concern! Read more Source: New York Times
Google Enables Parking Fee Payment From Google Maps: Google has released a new feature allowing consumers to pay for parking and transit fares directly from within google Maps. Users link their google Pay account to the Maps application - they can make touch-free payments at parking meters in more than 400 US cities. Google is also expanding this to pay for transit fares from Maps for over 80 transit agencies around the world. This functionality looks a useful addition to google’s AV and mobility initiatives! Read more Source: FinExtra
Insurtech
Lemonade – Has It Lost Its Fizz?: Lemonade results just out. Key results (US$):
Customer base to just over 1 million
Premium in force $213m
Renters premium $143m
Home/pet premium $70m
Q4 CAC doubled from the previous quarter to $385 per customer
Losses in real dollars - $122m in 2020; forecast loss of ~$170m 2021.
Are these good results? Market cap at COB 5 March $6.83bn (AUD). By comparison at COB 5 March IAG was $11.88bn, Suncorp $12.95bn, QBE $13.91bn.
Read More Source: Coverager
Root Insurance Results: Root Insurance has announced its full-year 2020 results. Some EOY metrics like premium growth, customer numbers and loss ratio have improved. Root recorded a full year net loss for 2020 of $363 million and reported total policies in force of 323,000. Shares fell about 8% in trading after the stock market closed below $15 ~ 44% below its IPO price of $27. Market Capitalisation as at COB Friday was US$3.38bn Read more Source: Coverager
Pet Insurance Comparison Site PawlicyAdvisor Raises More Money: Pawlicy Advisor is a pet insurance comparison website. It has just raised a US$6.5 million Series A funding round bringing the company’s total funds raised to US$8 million to date. Read more Source: Yahoo Finance
Ford and Arity Join Forces: Ford Motor Company and Arity (Allstate’s Mobility Analytics Company that services insurance companies with mobility solutions), is teaming up with Ford Motor Company to enable any participating insurer the ability to deliver simple and secure usage-based insurance (UBI) programs to eligible connected Ford and Lincoln vehicle owners. Arity is a super interesting company and well worth a look. Read more Source: PR News Wire
Swiss Re & Diameter Health Join To Use Electronic Clinical Health Data For Life Insurance Underwriting: Swiss Re and Diameter Health, a leader in health data interoperability, enter a partnership to transform complex clinical electronic health data into organised, usable information. This will accelerate Swiss Re’s efforts to help life insurers improve the speed and quality of their underwriting. A whole range of potential ethical and privacy issues here...Read more Source: SwissRe
Fintech startup Earnix raises $75m, reaches ‘unicorn’: Earnix is a cloud-based platform combines AI with advanced analytics that does modelling and simulations. The platform enables banking and insurance clients to give highly personalised real time price and product offerings to their customers. Read more Source: Times Of Israel
Allianz Partners With EV Start Up Gireve: Allianz Partners, is enhancing its roadside assistance offer for electric vehicle drivers with the ability to locate charging stations fully integrated into its incident management system. Offering the greatest coverage of charging points across Europe, GIREVE provides access to a comprehensive charging equipment database as well as real-time availability of charging spots and remote access to bookings. This a smart move in my view and I am surprised more insurers are not moving into this space – EV charging stations are the petrol stations of the future! Read more Source: Allianz Partners
Lost dog insurance – could this be the answer? Connected pet collar company FI raises $30M - valuation >$200m. The IoT pet tracking device costs US$149. The connected dog collars provide up to three months of life on a charge (with an average of around 1.5, according to the company). The device relies on Wi-Fi and Bluetooth, sending users a notification when a dog has travelled outside an AI-determined geofenced area. Great pet insurance extension? Read more Source: TechCrunch
#DiversityMatters
#startup ecosystem diversity is a problem. Women get less than 3% of #vcfunding globally, yet they typically outperform their male counterparts (BCG). Access to capital, training to help build new skills & access to networks of power are key challenges. Here I share the stories of inspirational women in the start-up ecosystem and important educational pieces.
To My Male Colleagues…please take the time to have a good read of this article. It will give you a good appreciation of the many challenges that women have - and the behaviours women have to deal with - in the male dominated technology space. I expect this also applies to the data and analytics space - which is also dominated by men! Us MEN really need to consciously make efforts to offset, to overcome, to correct the wrong stuff and to talk about these behaviours/challenges if they are to be overcome! Read more
Aurora Voss – ClaimSpace: Super excited to be sharing my latest story about inspiring female founder Aurora Voss and her insurtech ClaimSpace. Aurora has a clear, pragmatic sense of the challenges facing insurers and how taking a very customer centred view along with a great understanding of networks is a pathway to success. ClaimSpace helps insurance companies standardise digital experiences with its no-code collaborative process builder. The platform improves customer and partner engagement by providing easy to navigate, real time digital portals while providing more data and deeper insight into where processes go wrong. Read more Source: 11eight
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