At the recent InsurtechLIVE 23 event in Sydney, Simone Dossetor (pictured above), Insurtech Australia’s CEO, didn’t shy away from the big challenge facing her sector.
“It’s the first time, in 2022, that we've seen a drop in the global overall investment in insurtech since the phrase first came about in 2016,” said Dossetor, in her opening address. “So it's a challenging time, I know, for many of you.”
A recent Gallagher report found that global insurtech investment fell sharply in the fourth quarter of 2022, declining overall by almost 60% compared to the third quarter. The CEO said investors were on hand at the conference to explain the local implications of this dip.
Insurtech Australia was already working to reverse this trend and recently returned from ITC Singapore where one aim was to attract investors.
“The tagline for our pavilion with Austrade at ITC Singapore [Insurtech Connect Asia] was: ‘The best and brightest in insurtech starts in Australia,’” she said.
That event billed itself as the “world’s largest gathering of insurance leaders and innovators” offering “unparalleled access” to stakeholders - including investors.
However, the grim economic news for insurtechs seemed at odds with the level of industry interest on show in Sydney. Dossetor apologized for the lack of space at the venue. The event, held at the Museum of Contemporary Art, was sold out with several hundred participants and the room was overflowing.
There was other positive news. Dossetor said new insurtechs continue to launch in Australia.
“They either bring new expertise and technology from other industries, or they’re insurance geeks with a passion to solve a problem they've been frustrated about for many years,” she said. “And they're going out there alone.”
Some of those brave geeks turned up for the first presentation: “Insight into how insurtech geospatial and AI solutions can address climate risk and address affordability and accessibility for customers.”
The panel title was geeky but the presenters weren’t. Like the insurance industry, some geeks have changed for the better in recent years, in substance and appearance.
James Orchard (pictured immediately above), CEO of QBE Ventures talked about “game changing” geospatial technology while quizzing Rachel Olney (pictured immediately below). Olney is founder and CEO of Geosite and a PhD candidate from Stanford University. Her California based firm specialises in geospatial data which can be defined as time-based data related to a specific location on the Earth’s surface.
Olney explained the challenge of adapting geospatial and AI climate risk models across different countries. She said the accuracy and granularity of this data is getting much better and providing “scaleable understanding of insurance portfolios.”
Also on the panel, Nick Hassam (pictured immediately below), CCO and co-founder of Reask, an AI tech firm specialising in forecasting extreme weather risks. Adelaide based Hassam said that, despite their obvious disastrous impacts, nat cats are very good testing grounds by providing considerable amounts of data that can be used to improve the claims process.
He described the current forecasting technologies for cyclones and floodings as “very good” but said one current challenge is understanding exactly how the changing climate is interacting and changing perils like bushfires and floods.
Later presentations covered investment challenges; insurtech solutions and the customer experience; and, a panel organised by event sponsor EY discussed technologies that can speed up insurance processes.
Dossetor’s eye was also on the bigger picture. She said success for the wider industry depends on fostering an innovation culture with good partners, time, investment and an open mind.
“That mindset of openness, flexibility and generosity,” she said. “Coming from an insurance corporate myself, it really can't be underestimated that difference in mindset, pace and drive that you have working with the startups.”
Despite the drop off in investment, Australian insurtechs continue to have success.
“With an estimated 5.6 million SMEs in the UK and with a huge volume of deals happening without insurance, io.insure is designed to meet this need for underserved SMEs, which are the lifeblood of the UK economy,” said Killian McDermott, the firm’s co-founder and executive partner.
Cover Genius, another Australian born insurtech, refers to itself as one of the fastest growing insurtechs globally. The company was ranked by the Financial Times as the fastest growing company in the Asia Pacific in 2020.
Last year, one of the firm’s initiatives included partnering with RMS Cloud, a property management software company. The duo combined to offer what Cover Genius described as “a first-of-its kind solution” for the needs of holiday park residents: online damage and liability cover for holiday park operators.
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