New research from Startupbootcamp InsurTech (SBC) and PwC launches today, exploring how InsurTech has rapidly evolved over the past three years since Startupbootcamp InsurTech was established. The report shows that the narrative surrounding InsurTech has shifted and both parties are now working together to take the insurance industry into the next decade.
In year one, the debate focused on how startups would disrupt the incumbent insurance sector. In year two, the emphasis moved to collaboration, as startups and insurers pondered how to combine the former’s technology with the latter’s customer knowledge, understanding of risk, and capital strength. These collaborations looked beyond front-end focused applications in order to solve problems throughout the value chain.
Now in 2018 this evolution is continuing. Startups are increasingly coming into insurance from adjacent industries such as agriculture, property, health and transport, supporting insurers to offer new services to clients.. In which case, the question becomes, is InsurTech really “Insur”Tech anymore?
Startupbootcamp InsurTech and PwC address this progression in the report and categorize the Startupbootcamp applicants into those startups that sit within insurance and those that are beyond the sector. The latter group includes:
As well as a rise in the total number of applications, Startupbootcamp InsurTech has seen an increase in applications from adjacent industries as startups recognize that the insurance industry is ripe for innovation. This year, 61% of SBC applicants were from beyond insurance – and the trend of the program itself is clear. While 75% of the 2017 SBC cohort were clearly from within insurance, 80% of this year’s selection operate beyond the sector; they could standalone without insurers but now hope to sell to the industry or collaborate with its incumbents.
Key findings from the report include:
Sabine VanderLinden, CEO, Startupbootcamp InsurTech, says: “In just three years we have seen three clear market shifts from Customer Engagement + Apps to core system innovation, from personal lines to other insurance lines from pure InsurTechs to beyond. When we observe the trend, we have called “Beyond Insurance”, while we knew these collaborative connections were clearly on their way, we did not realize how fast they would become embedded within the very fabric of fast moving ventures. As we continue to support our insurance clients with the next phase of their transformation journeys, we look forward to driving impact with the reconfiguration of their business models.”
Jim Bichard, UK insurance leader at PwC, adds: “This year’s process has really brought home how things have changed and matured in InsurTech and how startups have been a real shot in the arm for the insurance industry. Three years ago the hype was about startups disrupting traditional insurers, stealing customers and market share. Now the talk – and increasingly the reality – is about startups and insurers working together to create meaningful partnerships. All parties are working together and learning from other sectors to solve problems within insurance and react to the changing outside world. This approach to innovation is creeping up the agenda for our insurance clients and it’s a pleasure to watch these small companies grow whilst helping insurers with their technology agendas.”
What next for InsurTech? The outlook for InsurTech startups is bright. Not every new venture will succeed but in a sector that is hungry for innovation – and increasingly willing to look beyond its boundaries for new ideas and solutions – the best startups have every chance of commercial success, whether in collaboration with incumbents or on a standalone basis.