Q&A with Matt Poll of insurtech firm Neos

What’s the problem with traditional home insurance and why do insurers in general suffer from an image problem?

Customers don’t really trust insurers and the industry has created that distrust with issues like dual pricing, policy wordings that are difficult to understand and the perception (typically wrong) that insurers would do anything to get out of paying a claim. 

The whole model, to some extent, is priced on customer inertia. I would get really frustrated because a lot of insurers talk about being customer-led, but the reality is, if they were really customer-led, there would not be dual-pricing issues and customers would value the products much more than they do. 

Insurers wonder why they’re not trusted. There’s no real engagement or dialogue with customers, so they don’t feel like they are getting anything from their insurer and it’s difficult to build up trust. Part of the problem with the insurance industry is that they think about things as insurers. They really need to start flipping their mindset and thinking much more about what it is customers really want and value. 

Start-up insurtech companies are appearing and get substantial funding as there is growing realisation that there’s a lot of money in the insurance industry. It’s a multi-trillion dollar business globally and probably there are better ways to do things and reward customers. The insurance industry, particularly in personal lines, is sitting on a bit of a precipice at the moment because it is going to be disrupted, I genuinely believe that. It’s just a case of who by and when.

Why did you set up Neos?

Until Christmas 2015 I was the commercial director of MoreThan. Then, much to my wife’s dismay, I decided to leave the corporate world and start Neos, an insurtech business focused on developing a better home insurance proposition using the connected home as an enabler. The connected home hasn’t quite taken off over here in the UK as it has in the US. One issue is that it’s still quite technology-led and I’m uncertain whether some of that technology is solving people’s real-life problems and issues. 

We have recognised that there is real value in being able to use this technology as an enabler to provide a much stronger customer value proposition in insurance. It’s a new way of protecting your home that’s more proactive – insurance is just one part of the offering. 

We’ve created a proposition that we hope adds value for customers, but also recognises that people still need insurance cover if things go wrong. While we will alert you in the event of a fire breaking out, chances are your home is still going to be damaged even if we can get the fire engine out there quickly. So we’re also providing premium home insurance as part of the package

We give smart technology to people when they sign up to help protect against the three major risks in the home: security/burglary, fire and water leak. All those devices connect through Neos’ app, which has a number of really cool features, one of which is to provide helpful alerts for all these different devices when triggered. A key focus of Neos is putting the customer back in control.

Who owns the data and how will it be used?

We strongly believe customers own their data. All these devices are pinging data feeds off to us and giving us information about occupancy, temperature and humidity in the house, how often taps are turned on and off, etc. We’ll be using that data to work with insurers to create much more sophisticated pricing algorithms using real-time data.

But, perhaps more importantly, we’ll be using that data to develop products and services that are more relevant to the customers themselves. We hope to do away with the more traditional insurance ‘broad brush’ approach. Our plan is to treat customers as individuals in the best ways that we can, as we understand that people have different needs and expectations when it comes to protection. If we use the data intelligently we have a great chance of delivering much better solutions that customers will value, as they are personalised.