Insurtech 101 with John Bean | 11:FS Explores

Summary

Insurtech, the convergence of insurance and technology, is revolutionizing the traditional insurance industry with innovative services and products. Driven by big data, AI, and IoT, insurtech companies like Lemonade are meeting evolving customer expectations for personalized and immediate insurance solutions. This industry is expected to grow to $119 billion by 2027, offering a more contextualized and embedded experience in everyday life, transforming the way insurance is perceived and purchased.

Takeaways

• 💡 Insurtech refers to companies using technology to disrupt the traditional insurance industry, similar to how fintech has impacted financial services.
• 🌐 The term 'insurtech' is relatively new, but the integration of insurance and technology has been evolving alongside advancements in big data, AI, and machine learning.
• 🏆 Insurtech aims to revolutionize an industry that has been slow to change due to high entry barriers, including strict regulations and significant capital requirements.
• 🛍️ Customer demands and expectations are driving changes in the insurance industry, influenced by trends in retail, banking, and telecommunications.
• 📈 The growth of insurtech is being fueled by new technologies and data sources, allowing for the creation of intelligent services and propositions.
• 🚗 There is a shift from product silos to a more contextual and holistic approach in insurance services, considering the entire insurance value chain.
• 🔍 Insurtech is primarily driven by technological advancements such as big data, AI, blockchain, and IoT, as well as a cultural shift in how customers are perceived and served.
• 🛒 The future of insurance is expected to be more embedded in everyday life, with products and services becoming more personalized and context-aware.
• 📊 The insurance industry is predicted to grow significantly, with insurtech valued at 119 billion US dollars by 2027, indicating a rapid and substantial market expansion.
• 🎙️ For organizations, it's crucial to adapt to new insurtech products and services to meet customer needs, while consumers should be aware of the diverse options available beyond traditional annual policies.
• 🌟 The insurtech industry is poised for significant innovation and growth, offering exciting opportunities for both businesses and consumers alike.

Q & A

What is the term used to describe companies that use technology to disrupt the insurance industry?

The term used is 'Insurtech', which is a blend of 'insurance' and 'technology'.

Why has the insurance industry been described as 'lethargic' and in need of disruption?

The insurance industry has been seen as lethargic due to its long-standing practices and high barriers to entry, including strict regulations and capital demands, which have made it resistant to change.

What technological advancements have been driving the growth of Insurtech and Fintech?

Technological advancements such as big data, artificial intelligence (AI), machine learning, and blockchain have been driving the growth of Insurtech and Fintech.

How are customer expectations and needs changing, and why is this impacting the insurance industry?

Customer expectations are changing due to experiences from other industries like retail and banking, where they expect more personalized and immediate services. This is driving the need for change within the insurance industry.

What is the role of telematics in the context of Insurtech?

Telematics uses sensors to gather real-time data, which can be used to create more personalized and intelligent insurance services and propositions.

What is the significance of the new data sources in creating intelligent insurance services?

New data sources, such as those from IoT and telematics, allow for the creation of intelligent services that can offer more contextual and personalized insurance solutions.

How is the insurance industry adapting to the changing customer expectations and technological advancements?

The industry is adapting by embracing Insurtech, which leverages new technologies to create more personalized and immediate insurance products and services.

What is the potential market value of the Insurtech industry by 2027?

The Insurtech industry is projected to be valued at 119 billion US dollars by 2027.

What is the cultural shift in the insurance industry that Insurtech is tapping into?

The cultural shift involves thinking of customers not in terms of specific product silos but in terms of their lifestyles and how insurance can play a role within that space.

How are insurance products expected to evolve in the future according to the script?

Insurance products are expected to become more personalized, contextualized, and integrated into everyday life, using the data gathered to offer richer experiences.

What are some examples of how insurance could become more embedded in everyday transactions?

Examples include insurance being immediate and automatic at the point of sale, such as when purchasing a car, watch, or even a PlayStation.

Outlines

00:00

🚀 Disruption in the Insurance Industry

The first paragraph introduces the concept of 'Insurtech', which is the intersection of insurance and technology aimed at revolutionizing the traditional insurance sector. It discusses how companies like Lemonade and others are using technology, including big data, AI, and machine learning, to disrupt the industry. The paragraph highlights the challenges faced by the insurance industry due to its long-standing nature and the barriers to entry, such as regulation and capital demands. It also touches on how customer expectations are driving changes in the industry, influenced by trends from other sectors like banking and telecommunications. The paragraph concludes by emphasizing the role of new technologies and a shift in mindset towards a more customer-centric approach in the evolution of insurtech.

05:00

💡 The Future of Insurance: Innovation and Personalization

The second paragraph delves into the future of insurance, suggesting that it is becoming more integrated into everyday life, similar to banking and payments. It discusses the potential for insurance to be immediate and automatic at the point of sale, enhancing the customer experience. The paragraph also speculates on the growth of the insurtech industry, predicting its value to reach $119 billion by 2027. It invites listeners to join a podcast or subscribe to a YouTube channel for more insights into insurtech, indicating the rapid growth and excitement in the industry. The summary underscores the importance of innovation and personalization in the development of new insurance products and services.

Keywords

💡Fintech

Fintech refers to the application of technology to financial services, aiming to improve efficiency and make the industry more accessible. It is a key concept in the video, illustrating how technology has been disrupting traditional financial services. Examples in the script include companies like Monzo and Revolut, which are revolutionizing banking through digital platforms.

💡Insurtech

Insurtech is the counterpart to fintech in the insurance industry, where technology is used to innovate and disrupt the traditional insurance sector. The script explains that insurtech combines insurance with technology, leading to new products and services that are more aligned with modern consumer expectations.

💡Disruptors

In the context of the video, disruptors are companies that challenge established industries by introducing innovative technologies and business models. The script mentions insurtech disruptors like Lemonade, which use technology to offer new types of insurance services.

💡Telematics

Telematics refers to the use of sensors and real-time data to provide context-aware services. In the insurance industry, telematics can be used to gather driving data and offer personalized insurance policies based on actual usage, as mentioned in the script.

💡Big Data

Big Data is the term used to describe the large volume of structured and unstructured data that inundates a data-driven organization. In the script, big data is highlighted as a driving force behind insurtech, enabling companies to analyze vast amounts of information to create more informed insurance products.

💡AI (Artificial Intelligence)

AI is the simulation of human intelligence in machines that are programmed to think like humans and mimic their actions. The script discusses AI as a key technology in insurtech, allowing for the development of intelligent services that can better predict and manage risk.

💡Machine Learning

Machine learning is a subset of AI that enables computers to learn from and make decisions based on data. The script mentions machine learning as an integral part of insurtech, helping to refine and personalize insurance offerings based on patterns in data.

💡IoT (Internet of Things)

IoT refers to the network of physical devices, vehicles, and other items embedded with sensors and software that enable them to connect and exchange data. The script uses IoT as an example of how new data sources are enabling insurtech to create more intelligent and personalized insurance services.

💡Customer Expectations

Customer expectations refer to the desires and requirements of consumers regarding the products and services they use. The script highlights how changing customer expectations, influenced by other industries like retail and banking, are driving the need for innovation in the insurance sector.

💡Regulation

Regulation in the context of the video refers to the rules and policies that govern the insurance industry. The script notes that high barriers to entry due to regulation and capital demands have historically made the insurance industry less dynamic, but changes are now allowing for more insurtech disruptors to enter the market.

💡Personalization

Personalization is the customization of products and services to meet individual customer needs. The script discusses how insurtech is moving towards more personalized insurance offerings, using data to tailor policies to individual lifestyles and behaviors.

💡Lifestyle Products

Lifestyle products in the script refer to insurance products that are integrated into everyday life, such as automatically adding car insurance to a broader policy when a consumer purchases a new vehicle. This reflects the trend towards embedding insurance into daily activities and making it more seamless.

Highlights

Fintech and insurtech are disrupting traditional financial and insurance services with technology.

Insurtech companies like Lemonade are using technology to innovate in the insurance industry.

Telematics and sensors are being used to gather real-time data for insurance services.

Insurtech is a relatively new term but the concept of combining insurance with technology has been around for a while.

Big data, AI, and machine learning are driving the evolution of insurtech.

The insurance industry has been slow to change due to high barriers of entry and established players.

Customer demands and expectations are changing, driving the need for innovation in the insurance industry.

New technology and data sources are enabling the creation of intelligent insurance services.

Insurtech is moving beyond traditional product silos to offer contextualized services.

Cultural shifts and new ways of working are as important as technology in the insurtech revolution.

Insurance is becoming more integrated into everyday life, similar to banking and payments.

Insurtech is personalizing insurance products and services based on customer lifestyles.

The insurance industry is expected to be valued at 119 billion US dollars by 2027.

Insurtech is experiencing record-breaking growth and is poised for further innovation.

The future of insurtech will involve richer, more contextualized experiences and personalized products.

Insurtech is making insurance more immediate and automatic at the point of sale.

For organizations and customers, it's important to be aware of the new insurtech options available.

Transcripts

you've probably heard of fintech and the

companies disrupting financial services

the likes of monzo revolut stripe and

many others well insurance has a name

for its disruptors too

insurtech

ensure tech is the term given to

companies using technology to disrupt

the insurance industry

as you might have guessed it's the

meeting of insurance and technology

this has been popularized by companies

like lemonade or by products and

services like telematics which use

sensors to gather real-time data

it depends what you're looking for in

terms of definition intro tech really is

this is relatively

new phrase but in terms of

bringing together insurance technology

that's been around a long time and

actually you would tie this to the

growth of some of those

big technology plays like big data like

ai like machine learning really is

they've evolved insurtech and fintech

have grown with them off the back of it

as we apply those technologies to the

products and services

ensure tech exists to disrupt quite an

established but lethargic industry

insurance has been around for a very

very long time

and rightly so

but fundamentally it actually hasn't

changed that much in part

due to high barriers of entry through

regulation and capital demands and in

part to being large established

dominant players

the world is changing though and

organizations can't operate the way that

they used to customer demands customer

needs and customer expectations are

changing this isn't driven just from

insurance this is driven from changing

expectations from retail from banking

from telecommunications

it's these new trends

and new customer expectations that are

driving changes within the industry this

has been fueled by new technology and

new data sources banking has been

through this hence the fintech the

regulation change has allowed suddenly

an explosion of new disruptive players

into the market

what we're seeing in insurance is that's

starting to spike right now the new data

is allowing us to create new intelligent

services and propositions rather than

historically looking at product silos we

can actually go after

contextual new intelligence services

that move up and down the insurance

value chain rather than focusing just on

car and home we're not there yet but

this is just the start

ensure tech is fueled predominantly by

probably two factors one is certainly

the technology

and these are the things like big data

ai

blockchain

sensors driving things like iot and

telematics

all of this really is the technology

side the other change though is really

more cultural and actually ways of

working gone are the days of where we

think of customers in particular product

silos actually we need to think of

customers of how they live their lives

and where does insurance play within

that space and is this mindset shift

that the insurtechs or the disruptors

that are really tapping into

and fueling this with those technologies

i mentioned earlier

[Music]

insurance is changing nobody likes

insurance i think it's probably a common

phrase it was always seen as a great

purchase but actually what happens if

insurance was at point of sale so when

you buy a nice new car or you buy a new

watch or even if you buy a playstation

what happens if your insurance was

immediate and automatic the way we buy

and sell financial products and services

are changing they're becoming more

embedded into our everyday lives

this is true for all financial products

within banking and payments

but also within insurance the reason you

should know about this is because

as an organization you have to cater to

these new products and services in terms

of for your customers and as a customer

you have to be aware that actually there

are multitude of different options out

there not just the annualized products

that you've bought in the past

[Music]

the future is creating to be honest new

experiences and new products and

services they will be much richer more

contextualized experiences the products

will be much more personalized and they

use that with the data that they gather

combining this

you will look at really products and

services not in silos so whether you're

a company

and you take on new employees

automatically your liability insurances

can go up if i'm a customer

and i buy a new car automatically that

might get added to a lifestyle product

[Music]

quite a lot

enough for it to be valued at 119

billion us dollars by 2027. over the

last few years we've had record-breaking

year-on-year growth it is a growing

industry and it's growing fast but

that's just the tip of the iceberg and

short-term if you ask me it's an

incredibly exciting industry which i

think will drive lots of innovation in

the future but don't just take my word

for it if you'd like to hear more join

us on our 11 fs podcast ensure tech

insider or subscribe to our youtube

channel

you