How has Covid-19 impacted the maturity of insurtechs? 21 October 2021

Efma and Capgemini organized a roadshow at La Place Fintech, in the heart of Paris, on Thursday, September 30th. Key findings from the World Insurtech Report 2021 were presented along with the main trends in insurtech.

On the day, Hannah Moisand, Head of Content and Strategic Partnerships at Efma, presented the views of a number of insurance professionals; all members of the Efma editorial committee. She asked the important question of “What type of impact has Covid-19 had on the maturity of insurtechs?” The responses received provided interesting insight into the current state of the insurance industry. 

For Dipu KV, President – Head of Operations & Customer Service at Bajaj Allianz General Insurance in India, the nature of the pandemic has brought the maturity of insurtechs forward by many years. “In the current Covid-19 era, as the customer footprint becomes increasingly digital, and carriers capitalize on the current shift to a digital way of not just working but living, insurtechs have come into the reckoning in a big way as they go about helping carriers meet / exceed customer expectations. In that sense, Covid-19 has fast-tracked the maturity of insurtechs,” said Dipu.

In Australia, Peter Tilocca, Chief Underwriting Officer at Zurich Financial Services, talked about how insurtechs may have been on the fringes before but he has witnessed a major shift from them toward the heart of the industry’s core processes. “Covid has certainly expedited the speed and need for change in the life insurance industry. The role of insurtechs has been magnified to help achieve the transformation required and as a result so has the maturity of same. From potentially looking for solutions at the periphery, the shift has been to mainstream processes in order for life insurers to meet the new challenges at scale. “

Beyond recognizing maturity, insurers have also realized the importance and opportunity that partnering with insurtechs can bring. “This was the first global crisis that relied on tech to get us through it. As the world locked down, our lives went almost entirely online. This trend is partly enabled by a growing willingness by insurers to partner with insurtechs at varying stages of maturity across their value chain to engage customers where they are, i.e. online. As the world prepares for ‘the new normal’ post-pandemic, many carriers will continue to rely on their partnership with insurtechs to further accelerate their trajectory toward digital transformation by leveraging emerging tech, business models, and new products to recover revenues, remain relevant, and retain their customer base,” said Hashmat Rohian, Assistant Vice President & Managing Enterprise Architect at The Co-operators Group in Canada.

In terms of getting work done, however, the pandemic obviously caused major challenges. “I think Covid hit insurtech maturity in both positive and negative ways. In a negative way, entrepreneurs were impacted by being forced to be virtual/separated. While collaboration technology has made it infinitely easier to work virtually, it’s just not the same as sitting elbow to elbow and building technology,” said Charles Brooks, CIO and EVP, Operations at Kemper. “On the positive side, Covid shook a lot of insurers out of their slumber on software and infrastructure who only reluctantly shopped for and invested in newer tech. Now, the audience for insurtech should be multiples more attractive to insurers for investments and partnerships which should pour miracle grow on early stage tech companies,” said Brooks. 

According to Parul Kaul-Green, Chief of Staff at AXA XL, the funding levels seen in the past year reflect a growing belief in startups across Europe, regardless of their size. “The pandemic has increased the pace of digital acceleration in the industry and this will no doubt continue post-pandemic. Global insurtech funding was higher for the first half of 2021 than all of 2020. This surge was fueled by record “mega round” financing rarely seen before in Europe. Efficiency in insurance distribution remains a priority for investors but we are also seeing an increase in start-ups focusing on policy administration, servicing and claims, notably through AI and machine learning,” said Kaul-Green. 

It is clear from the opinions of these decisionmakers in the industry: insurtechs have blossomed into major insurance players. 

Be sure to read the World Insurtech Report 2021

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