This year’s ACORD InsurTech Innovation Challenge revealed that InsurTech companies are identifying efficiencies in the insurance industry through a variety of different methods. Both the sharing economy and artificial intelligence (AI) are predicted to become more important over the coming years, as evidenced by the winners selected from the semifinal of the Insurance Innovation competition in Chicago.
Several criteria were used to determine the winners, including which ideas would provide producers with the best resources to write profitable business and which could offer the potential for the most radical cost-cutting.
Among the 19 startups that participated in the Insurance Innovation Challenge, two semifinalists were chosen, including one from the early stage category (companies with less than $250k of customer-generated revenue) and one from the late stage category (companies with between $250k and $1M of customer-generated revenue). Pablow Inc. was this year’s early stage winner for its idea to use the sharing market to provide insurance to renters who want to borrow a car through car sharing services, a gap that has yet to be filled. RozieAI was the late stage winner for its idea to use its proprietary artificial intelligence software to track real-time and historical user data to create a more personalized experience for its client’s customers. Both companies will take their ideas to the finals in New Orleans this October.
More than just a competition
The event also included a networking opportunity and provided competitors with a platform to discuss some of the challenges of operating in the InsurTech space, including finding the right platform to succeed, and issues with incubation and implementation. The main drivers of these issues historically has been over-involvement by incubators, accelerators and established partners, which can stifle an idea before it’s even gotten off the ground.
Anecdotal evidence suggests this could be the result of miscommunication or bad expectation management, leading to partnerships between mismatched startups and organizations, or high expectations and demands that may be too unrealistic to be met. This can be avoided if organizations are careful about choosing entrepreneurs that are right for their business and establishing a clear framework and expectations ahead of time to ensure the most productive relationships and the best end result. In addition to the issues previously mentioned, the recent Willis Towers Watson Quarterly InsurTech Briefing notes some of the challenges faced by startups and explores some of the related issues faced by them, carriers and reinsurers.
With the rise in innovation in the insurance industry, startups will do well to exploit new markets or offer expertise in existing markets that can’t be found elsewhere. Additionally, as the InsurTech market continues to evolve, there will be an emphasis on organizations to sift through the pool of entrepreneurs to find productive relationships – and an interest in competitions that seek to assist them, such as ACORD InsurTech Innovation.
In the meantime, our thanks go to the panel of judges, including Greg Moore (AVP, Willis Re) along with Megan Brandt (Program Manager, Global Insurance Accelerator), Mike Fitzgerald (Senior Analyst, Celent), Geoff Hakel (Senior Analyst, TransUnion) and Frank Sentner (Master of Ceremonies, ACORD). We’d like to wish our Chicago semifinalists luck as they prepare for the final round in New Orleans.