Opinion: Insurtechs are new industry ‘Marmite’

Over the last couple of months, it feels as if the industry’s focus and gossip has very much been around insurtechs and their role within the insurance ecosystem.

For example, I attended a webinar hosted by market intelligence firm Insurance DataLab back in May 2022 and one of the key talking points among panellists was how brokers should be better utilising relationships with insurtech firms.

Mark Cliff, chairman of Hastings Direct, emphasised that brokers must curate an ecosystem of technology-fuelled insurtechs to support their digital evolution, as well as to facilitate access to a different type of expertise.

In turn, this should support the customer experience and create operational efficiencies.

However, at Insurance Times’ BrokerFest 2022 conference on 16 June 2022, panellists from Oxbow Partners, FloodFlash and By Miles agreed that the industry-wide acceleration in technology adoption arising from the Covid-19 pandemic was merely a case of the insurance sector playing catch up to more digitally savvy marketplaces, such as banking.

Although the industry rose to the technology challenges posed by Covid-19, the panellists all concurred that this could not be called true innovation.

Lastly, amid the foray of industry summer parties and get togethers I’ve been attending recently, the majority of insurance professionals I chatted to appear to have an uneasy sense that insurtechs are entering the market with propositions that do not address current sector-wide problems.

Subsequently, this gets the mind whirring as to whether insurtechs are truly sustainable and profitable if they really are offering products and services where there is no demand.

Insurtechs seem to be becoming the new industry Marmite – loved for genuine out-the-box thinking and tech-driven efficiencies, hated for “unrealistic pricing” and sometimes questionable applicability to the insurance world.

Regardless of where you sit on this sliding scale, it is undeniable that insurtechs are here to stay and industry participants must separate the wheat from the chaff in order to benefit from truly innovative insurtech ideas.