Relativity6 was in attendance at InsureTech Connect (ITC) last week in Las Vegas. The event offered a close look into the insuretech ecosystem and my colleagues and I were fortunate to be there, and we made some awesome new connections. Before I share my thoughts on ITC 2018, I have a question, is there an “e” in insuretech or isn’t there...? After a late night of networking, mingling, and swapping war stories, my colleagues and I decided the “e” or “no e” question sums up the state of the ecosystem.
Here are the three major takeaways:
- It’s still the early days of Insuretech. The ITC conference is now headed into its fourth year and Relativity6 is looking forward to ITC 2019. Many comments by speakers at ITC 2018 noted the apparent maturation of the insuretech ecosystem. Insuretech appears to be in a manner of second wave, where investors are making fewer placements as more and more companies come along. Paradoxically, enterprise businesses are now more and more comfortable with insuretech applications. And therefore, sales, marketing, and innovation budgets have grown to accommodate partnerships with nascent businesses. This discrepancy - between the outflow of investment capital and the inflow of customer money - leads me to believe that insuretech is still finding its footing with customers and investors. I believe that when there is harmony between the investment side and the customer side, insuretech startups will begin to enjoy the stability necessary for long-term customer success. Stated another way, I think insurance has had trouble adapting to the rapid pace of deployment expected in the technology sector, and technologists have been frustrated with the guarded pace of the insurance businesses. Once both sides see eye-to-eye on expectations, the sky’s the limit.
- Corporate and startup engagements are still very difficult. As noted above, vastly different timing expectations are held by the tech side of insuretech as compared to the insure side of insuretech. I know many startups in the space that have sales cycles upwards of 18 to 24 months for enterprise insurance clients. Large insurance businesses undoubtedly have issues that can be solved by the tech being created by startups, but it can be very challenging to make a long term relationships work when engagements take so long to get off the ground. It makes sense that insurance companies would be careful. Many concerns arise regarding data security, on premise vs. off premise work, pricing, structuring and evaluating a pilots and proof of concept engagements. In the end, I found these comments by Munich Re’s Anthony Kuczinski to be very insightful - I agree with his points that no company can do everything and that information sharing is key to successful partnerships in the insuretech space. That’s why, at Relativity6, we focus solely on customer data - not risk pricing, or IoT applications, or chat bots - and that’s why we prioritize data security and digital privacy and recognize them as part of our corporate mission.
- Insurance industry people are super nice! It’s not always the case that startup events are genuinely collaborative and congenial. Startups are often competing for the same dollars and the same customers, and corporates can be jaded by the seemingly endless conferences. This can lead to a collaborative façade at the bar and the buffet table, but little else. However, ITC was a truly amiable atmosphere with a free-flow of ideas in the spirit of a competitive economy. I believe that this is due to the fact that insurance companies have grown more comfortable with technology companies and vice-versa. Both sectors have now achieved a level of familiarity with the other that has led to a less skeptical and more collaborative atmosphere.
All-in-all, ITC 2018 was a great place to brainstorm with startups and corporates and take stock of the competitive playing field. Relativity6 was fortunate to partner with Plug and Play Tech Center as a member if its InsureTech cohort, and ITC was a great place for us to see and be seen. We look forward to 2019! Hopefully there will be resolution on the “e” by then.
At Relativity6, we're obsessed with the industry classification problem and Artificial Intelligence. And more so, we're obsessed with solving the industry classification problem with AI. To that end, we've developed an algorithm that delivers 80%+ accuracy when classifying businesses across the globe via API with responses in under 1 second. All you input is a business's name and address.
Every day we iterate on our algorithms, feed them more data, and find techniques and strategies to get more accurate.
Check out the video below to see the Relativity6 Industry Classification API in action: