With a family background serving the classic car insurance sector in Germany, it might have seemed that the path of Nikolaus Sühr (pictured) through the insurance industry was pre-determined from an early age. While the founder and CEO of the digital insurance platform Kasko went on to study insurance and risk management in the UK before working in the insurance and consultancy industry for a while, his goal was always to take over the family-run MGA.
It was after joining the business, he realised it was not what he wanted to do for the rest of his life, in part because he had no passion for cars.
“It’s a bit like working for your favourite football club,” he said. “If you’re not that into football but everybody around you is super enthused, it’s hard to get it. So, I started Kasko with a friend of mine seven years ago on the premise of helping insurance companies to bridge the gap between market opportunities and their own IT constraints.
“I wouldn’t say that insurers’ IT is categorically bad or even old, it’s just that it has been around for a while and there are way more opportunities out there than they currently have capacity for. That’s how we started our ‘insurtech as a service’ business, helping insurers or insurance intermediaries create new products, onboard new distribution partners etc.”
Examining his path through the insurance profession, Sühr highlighted that what holds his interest in insurance is that it fundamentally comes down to a question of protection. It’s about understanding business models and processes - and insurance offers a unique standpoint into how business, society, and economics can work.
“I don’t believe insurance is broken or that it will be disrupted but I am a firm believer that the way we deliver protection does not require the current manual work and processes,” he said. “It’s a really interesting problem to solve and, as with most things, technology in isolation does not do the trick – you need to understand where to apply technology, and to know that just because something works in a neo-bank or e-commerce, doesn’t mean it will translate successfully into insurance.”
As a word, he said, ‘insurtech’ captures the interconnection required between customer interaction, technology and fulfilment that digital models are all about – as they apply to insurance. What people are realising is that what works when it comes to low-complexity, high-frequency transactions such as small online purchases or checking your bank balance does not directly translate to even a ‘simple’ insurance purchase.
There are just different steps, he said, and it comes down to basic questions including deciding what coverage works for you to questioning whether you trust a price comparison website over a word-of-mouth review or a respected brand. Sühr feels that a lot of the insurtechs that hit the market in 2015/2016 were overly ambitious in their objective of removing all advisory services from insurance in the move from paper to digital.
They believed this would drive customers to them because consumers were irritated by filling out forms, he said. But while this was one annoying aspect of insurance, ultimately insurance is about trust – and a holistic overview of the consumer market recognises that individuals will each have different buying preferences around insurance.
“And that’s a phenomenally interesting and complex problem set to solve,” he said. “Technology does play a part but it’s not just offering a digital, e-commerce site for insurance that usually does the trick.”
The first instruction Sühr has for insurance companies looking to solve the question of customer-centricity amid personalised buying preferences is to accept a cardinal rule – “do not try to get closer to your customer.”
“I have not seen a single policyholder that says, ‘oh what I would like is my insurance company interacting with me more’,” he said. “That’s just not the case. So, I believe getting closer to the customer actually means becoming more invisible to the customer, that’s the first thing…
“The second part of being customer-centric is by appreciating that, from a customer point-of-view, insurance is an infrequent and highly complex purchase. [… So] I think what insurance companies should do is appreciate that insurance is about trust and [not] try to re-educate their customers around their own preferences.”
From a product, service and technology point of view, Sühr’s advice to insurance businesses is to be agnostic about the channel that a customer uses without having to rebuild its assets. Looking at the UK car insurance market as an example, he said, what this means is making sure that whatever innovation a company invests in works across all channels - whether that’s a direct-to-consumer proposition, a price comparison site, for specific brokers, or a dealer management system.
There are various touch-points that are owned by somebody else that you can link into, he said. And, from a technology of view, the ideal is to build your assets in such a way that a large proportion of these are re-usable, so you can configure them together.
“Ultimately, what being customer-centric in insurance means is being multi-channel, multi-touchpoint,” he said. “[And it means] understanding that other people usually provide the access to your customer and, in order to minimise your own fulfilment costs, to appreciate that. That, to me, is really customer-centric.”
