🔎 Amazon reveals massive insurance partnership
Plus, Allstate is among several large firms to tie CEO compensation to diversity metrics 🙌
🔎 Amazon reveals massive insurance partnership. Marsh, a Global Leader in Insurance Broking and Risk Management, is partnering with Amazon to help small business sellers get affordable product liability coverage. To give third-party sellers access to low-cost product liability insurance, Marsh selected a panel of leading insurers of small commercial businesses and secured digital insurance distribution providers to support Amazon Insurance Accelerator, Amazon's new digital insurance network. (Read more)
Larry Jackson, Associate Partner @IBM:
Amazon's insurance partnership is indicative of an emerging trend in the insurance industry. In this digital age, brokers and insurers must develop the capabilities to efficiently leverage partner channels to engage with customers at their point of need with relevant products. For forward-thinking insurers, a relationship with Amazon may represent only one of several partnerships across multiple platforms. The days of relying on traditional insurance distribution channels are over.
🦛 Homeowner Insurtech Hippo to Go Public Today as Real Estate Market Remains Hot. Hippo Enterprises' has grown exponentially in recent years, forecasting $544 million this year and $2.28 billion by 2025, and plans to change homeowners' insurance by using customer data to make it faster and easier to get coverage. To get there, Hippo plans to develop algorithms that speed up policy quotes and create new products while also offering coverage for renters and products that traditional insurers do not cover, such as upkeep, security, repairs, and eventually selling the place. (Read more)
Yoann Michaux, Senior Partner @IBM:
Exciting IPO for a fast-growing company, at the intersection of tech & data, to target and onboard customers faster (they advertise a quote in 60 seconds) while better understanding risks. Plus, they are also progressively looking to be accessible everywhere, use data & tech to continuously innovate and launch new products, and pair the approach with risk prevention services against fire, water leaks, and burglary through IoT, Data & analytics.
The overall positioning goes way beyond home insurance and targets "home wellness," creating a daily interaction with the homeowner, vs. solely providing coverage and being there when there is a claim. Alerts for leaks, letting people in/out, monitoring pipelines "health": it helps the homeowner better manage his home, redefines the relationship with his Insurer in the process, who can look at opening new doors in terms of services, not solely insurance-based.
🙌 Allstate is among several large firms to tie CEO compensation to diversity metrics. Companies, like Allstate, are looking to increase the share of woman and other minority populations in their workforces across all levels (including senior leadership). Investors and stakeholders are putting the pressure on for companies to proactively work towards an equitable workforce. Promoting diverse people with different experiences is critically important especially in Insurance as they fight to attract and retain high-quality talent. (Read more)
Mimi Bulfin, Associate Partner @IBM:
It's exciting to see companies like Allstate putting money where their mouth is, literally. Developing metrics to measure an activity such as bringing diversity & inclusion to one's workforce means that executives deem it as key to their success, growth, and culture. Then going further and tying performance and compensation to it makes a statement. Nowadays, companies must serve a multi-dimensional stakeholder landscape across shareholders, customers, regulators, employees, suppliers, and the community at large. Holding leaders accountable for further diversifying and strengthening their workforce is a key ingredient in this!
💻 Cyber insurance 'needs to evolve' as it is 'not the right product' for the future - Hiscox. Hiscox spoke to Insurance Times after posting $133m profit in H1, it believes cyber insurance must change in response to the rising frequency and severity of ransomware claims. Cyber insurance rates have risen 20% on average and Hiscox believes they will continue to rise unless a shift towards a preventative stance on cyber insurance is made. Hiscox suggests that underwriters be trained by the same standards as IT security staff. (Read more)
Annap Derebail, Global Insurance Industry CTO @IBM:
The recent sharp increase in ransomware attacks has created a problem for cyber-insurers, as the insureds can offset losses with their cyber insurance policy payouts. With low incentives that induce defensive cyber-security behaviors, insurers closely examine their products, promoting mitigation education and making structural policy changes to improve portfolio performance. Technology solutions such as SafeGuarded Copy can enhance resilience by helping recover from adverse events faster, with reduced Recovery Time Objective (RTO). This improves resilience and can reduce payouts - something cyber-insurers should consider as a value-added partner offering.
🌱 Lloyd's launches climate action roadmap for the insurance industry. According to Lloyd's the industries global capital pool is over $30 trillion. The roadmap contains wide-ranging practical steps for helping accelerate the transition to net-zero carbon. “Lloyd's is proud to play a role, together with the global insurance industry, in partnering with sectors to provide the risk management solutions and investment that will help enable and accelerate the necessary changes and drive action towards a more sustainable world.” read a Lloyd's statement. (Read more)
Josh Olazabal, Partner @IBM:
Lloyds’ announcement is a critically important step for the company and the insurance sector as a whole. Insurance companies are front and center when dealing with the increasing risk and implications of climate change. Most are taking strong steps toward Net Zero and improving their internal capabilities in areas like underwriting and Sustainable investment management of their balance sheet and third-party assets. The Lloyds announcement speaks to the fact that insurance companies, with their risk analytic capabilities, financial strength, and customer relationships, can play a pivotal role in helping other sectors address these risks.
📲 Life Insurers, both traditional and startups, are battling against the preferences and behaviors of younger people. Ease of application, information/education availability, and gamification are all being deployed to attract younger people to life insurance. Companies like Pacific Life and John Hancock are digitizing the experience to meet the expectations of younger applicants and policy holders, while startups like DeadHappy are experiencing slower growth as they battle with the other priorities and opinions younger customers carry. (Read more)
David Kwon, Associate Partner @IBM:
It is always a pleasure to educate the importance of insurance to the general public. Younger adults have always been enigmatic to life insurers. The reason is simple - as it is designed now, the life insurance products are not relevant enough to be prioritized over other needs of young adults' limited finances. Arcane buying experiences add fuel to the fire. InsureTechs are trying, but still very experimental. But, I believe we are one good idea away from solving the life insurance-for-young riddle - just like Robinhood solved it for young investors.
Contributors:
Yoann Michaux — yoann.michaux@ibm.com
Stephanie Marino — stephanie.marino@ibm.com
Mikey Mayers — michael.mayers@ibm.com
Hugo Almeida — hugo.almeida@ibm.com
Vincent Chenneveau — vincent.chenneveau@ibm.com
Larry Jackson — larry.s.jackson@ibm.com
Mimi Bulfin— mimi.bulfin@ibm.com
Annap Derebail — annap@us.ibm.com
Josh Olazabal — Josh.Olazabal@ibm.com
David Kwon — dkwon@us.ibm.com
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These view are those of the individuals and are not representative of IBM.