Surveying the Tech-Driven Landscape
BrokerTech Ventures brings together industry partners from across the insurance value chain to work together on technology-related insurance innovation.
We recently had the chance to survey several of our BTV insurance company and wholesale partners about their thoughts on the question:
“How do you see insurtech impacting the insurance value chain, in 2021 and beyond?”
Garrett Koehn, President, Brokerage, CRC: “For 2021, I expect to see continued improvements in the customer purchasing experience, improved interfaces, less paperwork, improved underwriting data, and quicker response times. Additionally, we will have continued improvement in B2B integration as API capabilities improve between major players. Finally, I expect to see continued technological development in areas relating to parametric insurance, IoT, and capital markets.
“API integration has been an unusual challenge. Not so many years ago, I had a budget to build our first API-driven portal. As we went into conversations with carriers, I quickly realized I was building a portal to nowhere, and we decided to put the project on hold. Companies were not prepared to integrate with us, and many did not even know what API meant. Fast forward to today, and we have a bit of the opposite problem relating to scaling this technology. We have our REDY platform utilizing our extensive data set, and we want to add more API-driven capabilities with carrier and retail partners. Building these connections is not an efficient process, so it is going more slowly than we would like. Technology can also solve this scaling problem, so we are working on this.
“Technology and enhanced data allow improved efficiencies around capital market interest in supporting securitized insurance. There is now an increased ability to securitize long-tail and short-tail business lines, and certain structures (e.g., parametric) are especially well suited to these investors. Finally, new insurtech companies like Ledger Investing out of Y-combinator focus on the space to improve these efficiencies.”
Larry Taylor, President, Merchants Bonding Company: “We see technology as being the arms race of the insurance industry. Technology is accelerating the pace of change and has given the industry many more resources to collect and analyze data in assessing risk. Innovative companies that embrace technology will be more agile, smarter, creative, and connected to their customers in ways that traditional insurance industry models have lacked. The industry is really just at the beginning of being more innovative.”
Brent Hammer, Innovation Officer, Grange Insurance: “Maturing insurtech companies will dramatically accelerate the shift from a ‘build’ to a ‘buy’ mentality for incumbents, significantly increasing speed to market for new products and services, expanding digital distribution options for consumers, and greatly improving customer experiences.”
Steve Spray, Chief Insurance Officer, The Cincinnati Insurance Companies: “There are so many things happening in insurance innovation that the future is exciting. From aerial imagery, to APIs that increase efficiency for agents and carriers, to telematics to improve driver safety, these new technologies will allow us to compete in an ever-changing marketplace, delivering increased value to policyholders.”
Sumeet Bhatia, VP, Head of Innovation, Zurich NA: “Artificial Intelligence and IoT are among the emerging technologies that have the biggest potential to disrupt our industry. As AI continues to mature, we expect to see more use cases around intelligent automation that could ultimately transform the entire insurance value chain, from customer experience, product distribution, underwriting, claims, to value-add services. For IoT, in an increasingly connected world, we will eventually have an over-abundance of exposure data – new types that we were never able to collect before and then ones that we can access real-time. This has potential to fundamentally alter how we set up pricing and analytical models and also what insureds can do to proactively mitigate/reduce losses, all the while with data privacy continue being an important topic.
“We have been actively exploring potential use cases of AI and IoT to help us deliver differentiated customer/distributor experience, innovative offerings, and more efficient internal operations. At the same time, we are constantly looking for the right insurtech partners to collaborate on proof-of-concepts, with the goal to identify the right solutions to scale.
“For right now, we see that the key challenge to digitalization for a large carrier is really around prioritization. It’s easy to get lost in the journey if not careful and intentional as there are many areas that need to digitalize, and there are countless players out there, including insurtechs, that are constantly pitching their solutions to us; how best to prioritize and sequence efforts will be critical. It’s hard to comment on the exact challenges in five years, as the world is moving so fast plus with Black Swan type event like COVID-19. However, one thing for sure is that the pace of digitalization in the insurance industry is only to accelerate.”
Tim Turner, Chairman & CEO, RT Specialty: “Insurtech will enable retail and wholesale brokers to deliver specialized products and solutions faster. Brokers will have nearly instant information about each risk and have faster access to specialized products. The specialized advice and insights that retail and wholesale brokers provide will be greatly enhanced.”
Tom Parsons, Head of Digital, AmWINS: “Well targeted use of technology will no doubt continue to positively impact the insurance value chain. We see improvements in transparency and choice across an ever-widening range of products as important elements of this. Additionally, technology can enable more seamless interaction, leading to more efficient processes and improved speed of response.”
Bob Jenkins, Vice President, Business Capabilities Office, Travelers: “Insurtechs play an important role in the value chain, and we expect that will continue in 2021 and beyond. It’s a unique ecosystem where startups are working in close collaboration with established carriers to identify and resolve technology challenges for the industry – all with the goal of providing customers, agents and brokers with the best possible experience.”
Gerald Chiddick, Vice President of Marketing, Amerisure Insurance: “Enabling innovation and affording the opportunity to enhance our value to customers with streamlined processes. I see that as a continuous cycle of advancement in our industry.”
These voices and companies represent some of the strongest carrier and wholesale trading relationships among BrokerTech Ventures’ agency partners, and their insights are deeply valued.
We can’t wait to lean in and learn, as we continue to deepen our insurance company relationships, through BrokerTech Ventures and our Innovation Tower. We believe, that through BTV’s platform, we will continue to propel our industry forward in an altruistic manner, with the infinite game in mind.
Susan Hatten is the chief operating officer of BrokerTech Ventures.