Insurtech, the insurance of the future

The revolution of the century is setting foot in the insurance business. Small companies, newly-established, with a skeleton staff, with not much of a visibility and short of resources, turned up overnight in the position of challenging or even squeezing out giant and internationally renowned partners.

[1] Click to download
the magazine [1]

These technological start-ups are turning the insurance business upside down, being everywhere and on each front: customer relationship, big data, artificial intelligence [2], blockchain, driverless cars,… Alongside or in competition with traditional insurers, they are found to be active on every link of the insurance value chain.

Insurtech potential has not gone unnoticed by investors who disbursed 2.29 billion USD in 2017 to finance their activities. Just for the past year, 53 operations were finalized for the amount of 697 million USD with seven investments worth more than 30 million USD. Still in 2017, American Lemonade, set up in 2015, raised 120 million USD. Indian PolicyBazaar, insurance comparator, on its turn, estimated to be worth 800 million USD, raised 77 million USD during the same period of time.

These start-ups are not the only ones to take advantage of this financial windfall. Indeed, traditional insurers are equally active on the field of technological innovation, multiplying partnerships, dedicated subsidiaries and direct investments. Allianz invested approximately 100 million USD last December in BIMA, a microinsurance company established in 2010.

Ongoing technological revolution will necessarily end up with closer ties between traditional insurers and start-ups. The dice have been cast and the robotization of a wider section of the insurance industry will soon kick start.

Insurtech, the insurance of the future

Atlas Magazine N°151, May 2018 [1]