Insurtech weekly news roundup: June 17
The coronavirus pandemic has underscored the need for insurers to modernize but fewer than 25% of the 200 largest global insurers have truly digitized their value chain, according to a new study from ACORD and Microsoft.
ACORD is the standards-setting body for the global insurance industry.
The 2022 Insurance Digital Maturity Study also found that more than 10% of the largest global insurers aren’t noticeably leveraging digital technologies within their current business processes. What’s more, more than half of the insurers in the study say they are still exploring how they can use digitization in their business model.
The ACORD/Microsoft study includes data and insights as of June 2022, with an assessment of each company’s digital maturity compared to its peers. In addition, it identified issues, implications and execution imperatives around successful digitization.
“The gap between those who have been prioritizing digitization and those who have systematically underinvested is now impossible to ignore,” ACORD president and CEO Bill Pieroni said in prepared remarks.
Two insurtech findings in a recent J.D. Power study shed light on carriers and agents alike.
The first item: Usage-based auto insurance has seen record adoption in recent years, and customers who choose it have higher satisfaction rates, according to J.D. Power’s 2022 US Auto Insurance Study.
Usage-based insurance programs rely on telematics technology to monitor driving habits and assign risk and pricing. Roughly 16% of auto insurance customers now participate in usage-based programs, a number that has doubled since 2016, J.D. Power said. For these customers, price satisfaction is nearly 60 points higher on average than customers overall.
The second item, also from the J.D. Power study: customers that use online self-service tools can be beneficial to agents.
Customers were happier working with agents or customer service reps when they also connected to their insurer using digital channels. It turns out using both digital and live channels boosted efficiency for these customers, helping them to quickly handle transactions while also interacting with a live representative.
The message here: a multi-channel strategy is the way to go.
New York’s former chief regulator Scott Fischer has joined digital insurer Lemonade as head of government relations and co-general counsel.
Fischer, as Lemonade’s first head of government relations, will offer counsel regarding laws and regulations that impact the company. He’ll also guide strategy around relationships with key stakeholders in the insurance regulatory community.
Most recently, Fischer was a partner at the global law firm DLA Piper, where he represented international, national and local insurers and producers in their regulatory and compliance activities. He worked with New York’s insurance regulator for nearly 10 years, ultimately serving as the executive deputy superintendent for insurance in the New York State Department of Financial Services. While there, he led a unit supervising roughly 1,700 insurers in New York with assets exceeding $4 trillion.
Duck Creek Technologies
Duck Creek Technologies is partnering with ODG by MCG to help better understand expected costs and durations of injuries for workers.
Duck Creek is a global technology company focused on the property/casualty industry. ODG by MCG provides evidence-based guidelines and claims analytics for the workers’ compensation, disability and auto bodily injury space.
Their link-up is designed to help carriers make educated decisions about the claims handling process as they try to better understand the cost of a worker injury and how long that person will be incapacitated.
The insurtech start-up BirdsEyeView closed a seed funding round to help further development of its use of satellite data to structure insurance products and services for severe weather.
SFC Capital led the financing, with funds matched by the European Space Agency.
Plans call for using the money, in part, to add staff and further develop the company’s technology.
The company structures weather based-events insurance products using its RAPTOR proprietary algorithmic underwriting engine. It relies on meteorological data gathered by the European Space Agency and NASA, and then processes this to structure parametric insurance products – those based on the weather event itself rather than potential policyholder losses.
Digital home insurer Hippo recently appointed Richard McCathron as its CEO. He has served as president since February 2017 and will keep that title.
The previous CEO, founder Assaf Wand, is now executive chairman and he will focus on long-term strategic initiatives.
Hippo’s stock has dropped nearly 90% of its value since the company went public in 2021 through a reverse merger SPAC transaction. It traded under $1 at least part of the week of June 13.