After the recent takeover of the fintech industry, analysts have been attempting to identify which financial sectors can benefit the most. In a recent fintech conference in London, VC’s unanimously said that the insurance sector would desperately need technology guidance to further advance the field. With the rise of artificial intelligence and more efficient bank transaction processes, insurance falls behind in innovation and user experience. Insurance is seen as old-fashioned and rely primarily on brokers and paper while not being adaptive to the changing auto and home industry. Insurance Technology or “InsurTech” has seen a sharp increase in interest from VC firms due to its scalability and early profit projections. Startups such as Cuvva, a 150 million pound valued pay-as-you-go car insurance app and Trov have been the benefactors of an opportunistic market for insurance. With the high volume of startups appearing both in the U.S and internationally, we can assume that a wide variety of them will attempt to saturate and revolutionize the insurance industry. While InsurTech may be in line to replicate what fintech did to the market, some struggles initial struggles will occur. Insurance requires a more personal approach as it deals with humans and situations that are out of their control and too unique to automate. Auto payments are expected but it is believed that innovation will illuminate a discovery that technology can improve with insurance. Overall, it will be a few years until we see a substantial impact in insurance publicly but it’s important to know how early to target InsurTech companies for investment purposes.
URL: http://www.businessinsider.com/fintech-hot-insurance-insurtech-vc-economist-finance-disrupted-2017-2017-1
Very interesting points. Yes, I agree that it may takes years for us to see revolutionizing fin tech solutions in the insurance industry. In the new future, I think fintech may only be used to reduce transaction time and automate some processes.