The challenge to established insurers stands: The insurtech scene wants to turn the aging business model of the big insurers upside down and go back to giving customers the royal treatment. Innovative startups are driving digital transformation throughout the industry and have one goal in mind: gaining control over access to customers through a perfect customer experience. However, a few gaps in the process remain.
The insurtech market is booming. Within a single year, investments in insurtech startups have tripled. While the global fintech industry has recently suffered from reluctance among investors, developments for the insurtech community have been all the more positive. According to KPMG, more than $ 1 billion went into the insurtech market in the first half of 2016 alone – a new record that clearly indicates a growing trend!
A Frog Wants to Be Kissed: The Multi-Trillion Dollar Insurance Industry
For decades, hardly anything changed in the insurance world. Trillions of dollars in premiums changed hands every year, but significant customer experience innovations yet remain to be seen. Now digital transformation is making the insurance market more dynamic, and many innovative startups with a strong tech understanding and a 100 percent focus on customers are discovering this area for themselves. New insurtech players are bringing about structural change in the insurance industry while traditional companies are struggling to offer their services online. We took a closer look at some of the new players who are successfully taking advantage of the enormous potential for rationalization and innovation in the insurance sector.
Friendsurance– The startup was founded in 2010 and allows users with the same types of insurance to join together into groups. In case of minor damages, the group pays. Major damages are covered by the individual insurance companies. If no damage is reported within the group in the course of a year, everyone gets some money back in the form of a bonus.
Grover– The startup revolves around the megatrend “using instead of owning”. Customers simply rent the latest technology instead of buying it. Grover doesn’t offer insurance directly, but its business model is largely based on the idea of an insurance company: technology lovers can use their favorite device flexibly and return it at any time.
Simplesurance– This insurtech focuses on e-commerce and cooperates with online providers. More than 1,400 stores sell insurance that is integrated into the checkout process. The basis for success is an IT system that makes the integration of various insurance offers into an online shop extremely simple. Disclaimer: B2X support Simplesurance with customer care solutions :-)
To the benefit of many customers, insurtech companies will make a significant contribution towards making insurance much more customer-friendly with the help of digital innovations. However, some operational details still need to be worked out. Many startups don’t have mature operational processes when it comes to customer care and supply chain management – areas that are essential for providers of product insurance for electronic devices such as smartphones and consumer IoT devices. Building a company-own infrastructure with international coverage can take years – valuable time that new insurtech providers simply don’t have.
Turnkey Solutions for Insurtech Companies
At B2X, we prepared for this challenge early on and support insurtech providers in the fast expansion of their business through our global service partner network in 140 countries. Providers of product insurance for smartphones and consumer IoT devices can use our authorization for multiple manufacturers, giving them direct to repair services and spare parts.
At the same time, we support the professionalization of claims handling. Our SMARTCARE Technology platform seamlessly maps out the entire claims process. All involved service partners are connected to our platform via APIs, making the claims process 100% transparent. A nice side effect: Our close ties with various Asian brands often lead to new business opportunities for insurtech providers. These brands are looking for plug & play insurance solutions that they can integrate into the checkout process of their online shops, for example. Collaborating with B2X therefore results in win-win situations for all parties involved.
Summary: Hundreds of insurtech providers are pushing their way into the insurance market and focusing on a convincing formula for success: making insurance easy. Newcomers are facing the same challenges that have been giving established insurers a headache for years. Customer care processes in particular are complex and can’t be implemented internationally from one day to the next. B2X offers a turnkey solution for insurtech companies that doesn’t require any initial investments and has been thoroughly tried and tested. Contact us today and don’t forget to follow B2X on LinkedIn!
Robert Aderan is the Head of InsurTech Practice at B2X.