Last week saw the launch of Sydney based insurtech FreightInsure, following an investment from Lombard Australia Holdings. Lombard, an alliance of surety providers, announced a “significant investment” in the insurtech.
Lombard is the holding company of Assetinsure, an insurance company with offerings including domestic building and landlord insurance as well a range of bonds. The investment involves Assetinsure partnering with FreightInsure.
“Our goal is to make insuring freight as easy as point-and-click,” said FreightInsure CEO Simon Schwarz. His firm’s embedded insurance offering can cover everyday freight deliveries including laptops, bicycles, musical instruments, and household goods.
But what exactly encouraged Assetinsure to invest and partner with this insurtech?
“My particular focus is partnering with and investing in innovative, owner-operated insurance businesses, particularly in the agency space,” said Doug Laburn (pictured above), head of risk partners at Assetinsure. “I've done that for the last 10 years in the South Africa market and I joined Assetinsure to help build this part of the business here.”
Laburn said the Lombard group covers a number of operations in Australia, South Africa, Europe, and the UK. He said these operations are often orientated around backing “great entrepreneurs that have been building something new in the market.”
He listed several key features of FreightInsure that precipitated their commitment.
“We look for a couple of key things in new opportunities,” said Laburn. “Firstly, it’s a sense of building businesses of tomorrow.”
He said this involves thinking “long and hard” about the types of businesses that are going to be successful in the next three to five years.
“Generally, that has a strong data or technology related component, either proprietary data, which we’d be able to do something interesting with, or a particular approach to technology that can create a level of sustainable differentiation,” said Laburn.
He said they found both of these positive features in the FreightInsure environment.
“Secondly, is a sense of the people,” he said. “We simply like to do business with people we like and share a common culture and values with around delivering value to clients and underlying trust.”
Laburn said after working with the FreightInsure team, “that has really shone through.”
The third component involves the timing of when they like to get involved in a business.
“We feel we’ve got a particular skill set in helping build and scale fairly early-stage opportunities that have a close proximity to distribution,” he said. “This skill set covers capital provision, our licence platform and global experience in working closely with founders in building and delivering on strategy.”
Laburn regards the FreightInsure embedded offering as “unique.”
“I’m massively excited about the potential,” he said. “There’s obviously work to be done but I’m excited to be at this point.”
The Lombard media release announcing the launch, said FreightInsure will “significantly simplify the way goods-in-transit insurance is distributed and purchased.”
FreightInsure is part of the FreightSafe Group, Australia’s largest third-party claims manager for the transport and logistics industry, according to the release.
“Lombard and Assetinsure are highly respected in the insurance landscape with a history of protecting Australian businesses and assets and supporting and growing underwriting agencies,” said Jonathan Bass, director of FreightSafe and non-executive director of FreightInsure.
FreightInsure will provide embedded goods-in-transit insurance integrated into its freight booking process.
“FreightInsure revolutionises the process by allowing consignors, who are often small businesses shipping their products on a daily basis, to cover their delivered goods against loss or damage in transit under pay-as-you go mini-policies,” said CEO Schwarz.
He said eCommerce is expected to be 40% of total retail sales by 2026. “The number of single carton shipments to consumers is exploding in volume creating a significantly larger number of total consignments in Australia and globally,” he said.
Schwarz said this provides “a strong operating environment” for his firm. “We are excited to be launching this business with locally strong and globally trusted insurance operators,” said Bass.
Lombard Australia Holdings is part of Lombard Holdings. On its website the firm describes itself as “a boutique investment house.” The company is based in Singapore.
According to some reports, Australian consumers are very interested in embedded insurance offerings.
According to a survey conducted by Momentive.ai for the embedded insurance insurtech CoverGenius last year, 70% of digital bank users in Australia would be highly interested in being offered embedded insurance based on their transaction details.
“What this survey says, and what we think, is that embedded insurance offers that utilise transactional data and create true convenience for the customer in that they’re right in their digital banking interface, customers want to buy that,” said Cover Genius CEO Angus McDonald.
