On October 18th, more than 150 insurance, finance and tech professionals gathered at the LHoFT (Luxembourg House of Financial Technology) to participate to the third edition of the Luxembourg InsurTech Summit, which aims at facilitating discussion and the exchange of best practices, while also tackling the latest news and trends of the InsurTech sector.
The day started with Charlotte Boutelier (Head of Marketing, Farvest) officially opening the event and welcoming Sabine VanderLinden, the CEO of Startupbootcamp InsurTech. Back in Luxembourg after participating to the first edition of the InsurTech Summit, she shared her vision and a recap of the last 3 years of InsurTech, focusing on lessons learnt and best practices. She started: "The first years were about observing and learning, now we want them to execute. We need the corporations to bring in more business unit people to implement new solutions and actually make an impact". Sabine VanderLinden then went through the different business models of the InsurTechs: internet-first insurers (serving consumers with digital/mobile first health insurance and personal lines business models), distribution platforms (providing distribution platforms for all sort of insurance products), benefit-led models (providing HR & Payroll solutions for employers to integrate with employee benefits), underwriting & risk (providing data analytics, software, solutions to insurers for underwriting, risk management) and Insurance-as-a-Service (back office focused platforms that aim at replacing old legacy environment with new digital capabilities). She also explained that "the first year of InsurTech was about discovering and enhancing interactions, year 2 was about trialing and bringing in more complex products, while year 3 was about executing and startups coming from adjacent industries, to solve big data problems. InsurTech is everywhere and it is now about reaching new parts of the value chain. As an example, many of the discussions we have had this year with our insurance partners have been around how to help them move from protection-lead offerings to prevention-led offerings". She also highlighted that insurance companies, along with startups, are working on securing new external data sources, but also on reinventing the customer proposition. Finally, the Startupbootcamp InsurTech CEO, explained the difference between digital transformation and digital innovation, also describing the different types of innovation used by insurance companies (in-house, ecosystem engagement, partnerships, corporate venture capital funds, venture build and mergers and acquisitions). "Current and future solutions need to solve real business problems, establish real innovation systems and deliver strategic outcome. Yet, the biggest challenge is to change the culture and the mindset of the companies" concluded Sabine VanderLinden.
"Developing an innovation mindset for a better cooperation with InsurTechs" was the name of the keynote speech given by Jean Elia (CEO, Sogelife). "In today's world, digital transformation is a fact, we are witnessing the emergence of new technologies and actors are counting on them to disrupt their sectors. Banks and insurance companies therefore have to adapt their business models," highlighted Jean Elia, who continued: "This transformation touches all parts of the company and changes every aspect of our daily lives: it requires companies to change the way they do business, test, fail, and accept it". According to him, traditional companies and startups have to partner and co-create, which can be seen as a challenge for several leaders and organizations: "it's not easy to switch to a startup mindset. The process takes time". At Société Générale Luxembourg, as a group, digital strategy is composed of 5 aspects: transformation (accompany, train and involve people in the organization transformation), branding (strengthen the brand of Société Générale), be pioneers (be a key actor of innovation in Luxembourg), project management (accelerate the process execution) and partnerships. In this respect, Sogelife put in place a new transformation project unit, mixing organization flexibility (hybrid composition, agile method), mindset (UX focus, leading by example) and operation transformation (industrialization, synergy and innovation). Also, the company launched #LePlateauLux on the 20th of September, a lab to host startups and facilitate the cooperation (and co-creation) with experts.
Eugene Greenberg (CEO of GetMeIns) then took the stage for a presentation focusing on the "importance of fighting as an entrepreneur". He started by sharing a quote by Vince Lombardi, the former coach of NFL Team, Green Bay Packers, "Winners never quit and quitters never win". The serial entrepreneur, currently working on the InsurTech startup GetMeIns, then shared his best practices when it comes to succeeding today's business world: "be in a zero optionality mood, do not even think of failing and doing something else. It's what differs the guys on top form the rest. Also, stay focused, chose a specific area and bring in an expertise. It is also key to know exactly what do you sell to an insurance company, when and to whom".
A round table entitled "Developing the next generation of insurance products" brought together Tine Vanmassenhove (Head of Partner & Client Services, Lombard International Assurance), Arvid De Coster (CEO of WeGroup), Jonathan Prince (Co-founder, Finologee), Jan Kastory (Partner, Astorya.vc) and Glen Lawyer (Head of R&D at Cyber Hedge). Nasir Zubairi (CEO, LHoFT) moderated the discussion. "First and foremost, the products need to be fit for purpose. Nowadays, customers request constant access to information and services. Therefore, digital and tech, as a facilitator and business enabler, help us keep pace, in an environment where everything is urgent," started Tine Vanmassenhove. According to Jan Kastory, people do not want insurance as a "stand-alone product", they need to prevent damage and rapid claim processes. He added: "Clients want their problems to be fixed, not insurance. Frictions need to be avoided, and invisible insurance might be a solution". Jonathan Prince then explained that insurers can automate many processes and therefore improve the existing products and services, by using an external provider or external components. "Alliance is the way innovation is going. As an insurance company, you can't do everything, you have to rely on external expertise. We can foresee the next evolution, to be able to either optimizing the existing (via external) and build new products," he added. According to Glen Lawyer, hackers cause a social risk as well as a business risk: "Yet, insurance companies do not have an answer for cyber risk. They need to understand it in financial terms. As a matter of fact, intangible assets are going to become the most valuable assets the company has". Finally, Arvid De Coster insisted on the fact that it is important for a startup is to address a real issue, with trust being the key, as people are connecting to the company. He added: "InsurTechs and insurance companies are working together and are challenging the entire value chain, in order to bring real innovation: partnerships is the way to go!". Nasir Zuairi concluded: "Companies are working on fixing problems that exist today, but we should think about tomorrow. Social behavior will change, creating different risks and problems".
Philippe Evrard (Director of Technology, Lombard International Assurance) then took the stage and focused on technology, as an enabler of quality of service. "With a prime positioning and as a leader in the area of international life insurance, our mission at Lombard International Assurance is to deliver the best service possible to our clients," he explained. But how is technology integrated? The Director of Technology highlighted that his team focuses not only on tech and innovation, but also on the process, which he described as "the way we see and manage technology". According to him, we are currently in the middle of a sea of tech and selecting the right solutions, understanding their implications and value has become a challenge. "Also, tech is not reserved to IT anymore. The IT function has to evolve and has to federate the entire organization and teams around technology, in order to turn it into an innovative organization," added Philippe Evrard, who then listed the different tech aspects Lombard is working on: transparency (access to data through a digital platform with several functionalities, to improve client trust), efficiency (a new RPA platform and a dedicated team, improving the efficiency of back office teams), insight (analyzing clients data, to have a better knowledge and understanding, in order to better serve) and finally, the core IT (the modernization of legacy systems. He concluded: "Digital, core, old and new, it all comes together. We need to find the right balance between core technology and high value digital innovation. We are driven by an aspiration for service excellence".
"How does technology propel Insurance into the Future?" was the question asked by Frank Roessig (Head of Digital Finance Solutions, Telindus). "If we take it back to basics, insurance should ensure our future. Yet, today, we still need to walk into an office, enter our information, and sign. That's more or less the insurance experience of today," started Frank Roessig, who then advocated the creation of an inspiring client journey, as "clients do not care about insurance, all they care about is a smooth and rapid delivery when something actually happens". As explained by the digital finance specialist, clients are now looking for seamless experiences, mostly on their mobile, and it insurance companies do not provide those types of experience, clients might very well leave and go somewhere else. He added: "clients buy if it's convenient. Moreover, they like technology that makes them feel like a simple number. Yet, they are open to innovate business models that reach their expectations and give them access and control. They want a different delivery of insurance. Some of them might even be willing to give up data for a cheaper insurance solution!" Frank Roessig then shared a couple of example, notably of a Chinese insurance company which bases its offers on their clients' digital behavior. He also explained that robots are now able to detect the mood of customers and can help with client retention. "Therefore, applying intelligence and mature tech to insurance will give companies a competitive advantage. But a clear vision is needed," concluded the Telindus expert.
"How to collaborate with insurers?" was the topic of the next round table discussion, Alex Panican (Head of Partnerships & Ecosystem, LHoFT), with the participation of Pranay Jain (CEO & Co-founder, Enterprise Bot), Christian Paun (Head of Business Transformation & IT Procurement, Lombard International Assurance), Adina Grigoriu (CEO & Co-founder, AAA) and Jamie Eltorkey (CEO, ICompare). According to Adina Grigoriu, "insurers are moving fast towards digitalization as they are investing a lot of time to get there. Yet, several challenges remain, making it tough for traditional companies to collaborate with InsurTechs: no open architecture, no real data exchange, no standard on electronic signature". Pranay Jain thinks that it is a great time to be an insurer, benefiting from the current huge digital movement, but that testing is challenging: "As a startup, we know it risky to go live. How is it a part of the framework? Changes are taking place: companies can be at the forefront. Insurers therefore need to quickly give answers and feedback". Contrary to the other panelists, Jamie Eltorkey actually thinks that insurers are quite late when it comes to transformation and innovation, mostly because of the regulation. He then shared his vision: "More competition means more innovation. Perseverance is key, so is partnering with the LHoFT if located in Luxembourg". On the insurance side, Cristian Paun explained that is not that easy to innovate and transform a company. He added: "we need to challenge ourselves and see what we can do to add more value. How do you innovate in the current sea of regulation?". He also insisted on the fact that startups need to address a specific problem, applied to a specific industry, as even the best product may not be adapted to an insurance company.
Jonathan Prince (Co-founder, Finologee) then focused on the next generation of insurance products & services at the age of APIs and collaboration. "What we have learned during our journey is that it is key to identify the true pain points of your partners. It is also necessary to think 'ecosystem' and therefore to bring other people in to build your solutions," underlined Jonathan Prince. Also, according to him, it is important to have the sponsor of the board and top management. "You can't fight against the digital wave, and need to embrace change. For instance, user experience clearly brings value to the clients," he added. Jonathan Prince also insisted on the fact that the entire organization and its people need to understand the impact of digital on current business and that a clear vision will help develop new products, services and even business models. But companies, especially in the insurance sector, are facing several challenges, notably moving from a "castle" to a modular system where they could bring in new components to create a modern system. In this respect, Finologee created an API marketplace, which can be defined as a LEGO box, where you can pick the blocks you need. The co-founder of Finologee ended his presentation by stating that "it is simply impossible to develop each and every component in-house: you need to rely on partners. At Finologee, we are a one-stop-shop helping you provide a best-in-class experience to your customers, with full regulation compliance and high end and compliant hosting and operations".
"Will Big Data & Artificial Intelligence kill the traditional Risk Underwriting?" was the question asked Jan Kastory (Partner, Astorya.vc). According to him, "insurance is all about data. It has always been as it is related to statistical prediction. But now, we can collect data and analyze it way better". The expert also highlighted that bringing new tech and notably machine learning and AI to insurance will mean more automation: "For instance, concerning insurance underwriters, 99% of the scope of the job is going to be automated. Technology will be here to change the way we work". Yet, finding experts in these domains is complicated as insurance companies are facing competition from the GAFAs and many startups. "Who dares to challenge the almighty insurers? In Poland, YANOSIK is reinventing car insurance, analyzing key risk factors such as driving dynamics, distances, speed vs road conditions, etc," explained Jan Kastory. He then shared several other examples. According to him, Tesla may soon enter the car insurance business as it is able to prevent accidents, and if they can do so efficiently, provide a ratio and apply it to their model, they will be able to lower the premiums of insurance. He concluded: "Yes, risk underwriting is being challenged. The skill gap is becoming a burden for most insurers. Also, the challenge comes from industry outsiders".
Luxembourg InsurTech of the Year pitch session
Also, during the day, first the first time during the Luxembourg InsurTech Summit, several startups were invited to pitch in front of a jury composed of Christian Strasser (President, ACA & CEO, Lalux), Remy Els (CIO, Foyer Group), Hocine Berrane (CIO, CALI Europe), Jacques Faveyrol (Vice-President, ACA & CEO, CARDIF Vie Luxembourg) and Cristian Paun (Head of Business Transformation & Procurement, Lombard International Assurance).
Eugene Greenberg, the CEO of GetMeIns, first took the stage to present his solution to fight against fraud, which reduces insurance companies' loss ratio by delivering military-grade intelligence that detects and predicts fraud. Pranay Jain, CEO & Co-founder at Enterprise Bot, and Ravina Mutha, COO and Co-Founder of Enterprise Bot, pitched their startup which creates AI-powered chatbots to automate customer interactions and provides enterprises with a readily accessible digital agent to improve customer experiences and create operational efficiency. The CEO of AAA, Adina Grigoriu, also participated: Active Asset Allocation is a fully independent financial engineering company (FinSurTech), specialized in the management of portfolio risks and the optimization of investment strategies for institutional investor and asset managers all around the world. Dan Isaac, who's in charge of Operations at Ibisa, highlighted the company's ambition to disrupt the traditional insurance model and make it affordable, accessible and easy to adopt by a vast range of smallholder farmers, and profitable for the stakeholders involved in this new risk sharing ecosystem. Finally, Arvid De Coster took the stage to present WeGroup, the company he co-founded, and which is the first provider of peer-to-peer insurance products in Belgium. Users are part of a community to share risks with one another.
After the deliberation and a tough decision, as highlighted by Christian Strasser, Enterprise Bot was named Luxembourg InsurTech Startup of the Year.
The next event organized by InFinance will take place on November 15th: the Luxembourg Finance Innovation Summit will celebrate its 10th anniversary, welcoming local and international experts, while also recognizing the best solutions and practices, through the Luxembourg Finance Awards. More information and registration: gala.infinance.lu
Photos: Dominique Gaul
Publié le 19 octobre 2018