A little bit later down the road they’ll get engaged with startups, fund POCs [proof of concept projects], pilots and eventually ingrain them in their everyday workflow or partner with them to launch new products.
Then there are the more advanced corporates, the carriers that are working side by side with startups in a collaborative innovation environment that enables them to get faster to innovation, faster to obtain new distribution channels and faster to implement new tools and resources. As they scale in progress, carriers are now investing alongside with us.
Underwriting—data is what everyone is after. How do you leverage new insights in a way that you can price the risk correctly? At the same time, if we go too granular in the data, are we forgetting the fundamental benefit of insurance, which is pooling people and the risk in a way that we can provide coverage to folks that are perhaps more in need? If we can leverage insights, for instance, that we can get through 23andMe, are we going to deny insurance because someone has a genetic trait that they can’t do anything about?
Blockchain—that’s one of the few areas where we feel the corporates are actually running away from. For better or worse, there was a lot of hype a couple of years ago, and now I don’t think I’ve seen any requests for startups doing something on the blockchain space for all of 2019.
Singapore is another place we love. English is a great way to bring down a lot of the barriers. A lot of our corporates are looking at leveraging Singapore as a gateway into Asia.
Latin America—we’re opening up one of our newest offices in Sao Paulo—that is also an area that’s very interesting given that you have a market such as Brazil that is massive. Argentina, which was also very interesting in our eyes, but with the current political situation, it’s a little bit more on the back burner. We feel that Brazil is the next market that we want to open up.
Not only the NAIC but also because of the constraint that startups have in terms of money, which translates into runway, you’re competing with more established players like corporates that are spending billions in marketing. What’s very interesting is that—unlike other areas of the market—within insurtech, it’s a great place where relationships are built.
Startups will go the MGA route and partner with a carrier for capacity, partner with a reinsurer. What you need to succeed in this space is to build long-lasting relationships with different stakeholders.
Regulators are definitely building a more collaborative approach. They don’t want to be the ones shutting down new products that are going to provide customers with protection. Ultimately, we are talking about providing them with new ways that they can be better served by having coverage they didn’t have before or at prices that are more accessible to the public.