Bringing the Amazon experience into insurance

How insurtechs and digital MGAs are solving the speed to market issue in the industry

Bringing the Amazon experience into insurance


By Alicja Grzadkowska

The insurance industry has come a long way in terms of innovation, and specifically in its ability to deliver products quickly to the marketplace. This change has happened due to innovative thinkers in the marketplace that have identified gaps in the insurance supply chain and come up with solutions to fill those gaps. Some of these innovators are looking to technology giants for inspiration, like Amazon, which has redefined how people purchase goods and services.

A decade ago, one insurance expert who happened to be the global CIO at Hiscox, took a look around the company and then the industry as a whole and found it lacking.

“The two things that Hiscox is really well known for is underwriting excellence and also being one of the leaders of leveraging technology in their pursuit of providing great experience and great results. But when I was there as a CIO, I looked to the technology that they were using, and it was a little bit surprising for me,” said Tim Hardcastle (pictured above), today the CEO and co-founder of Instanda, a cloud-based insurance ecosystem. “There seemed to be still some opportunities and challenges for them in the technology arena.”

Hardcastle began wondering if the rest of the insurance industry was on the same level as Hiscox with the leveraging of technology. He also wondered if there were vendors who were addressing the pain point he saw in the insurance distribution channel, which is that MGAs and carriers can’t get products designed, built, and personalised for their markets – and do that relatively easily and quickly – and then distribute them through various channels.

“The research I did of the vendors in the space that I was looking at [found that many] were pretty old and antiquated, and they were not able to meet some of the pain points. So, two things came out – one, the industry was not really leveraging technology in a way I’d seen elsewhere, and two, there weren’t vendors around to kind of come up with the solutions. That’s what was the catalyst for us starting up Instanda,” said Hardcastle. “Any carrier in the world I’m confident can take our platform and get a time to value within a matter of weeks, and they can start to increase their revenue and reduce their cost.”

That speed and customer experience, which is also inherent in the Amazon experience, likewise drives how digital managing general agency Dovetail Insurance approaches the distribution of insurance.

“What we tend to focus our conversations on at Dovetail is ‘look outside of insurance’ – what are the best experiences you have in buying, whatever it is you’re buying?” said Michael Ferber (pictured below), the newly appointed CEO of Dovetail Insurance. “All of us use Amazon and we all know what that feels like. At Dovetail, what we think is that we want to be the Amazon of insurance, meaning that when I go to Amazon, there’s nothing you can type in the [search bar] that you’re looking for that they don’t have.”

Ferber pointed to an experience his daughter had buying a bumper for her Jeep on Amazon, and, surprisingly, she had plenty of options to choose from on the site. In a similar vein, retail agents should be able to find every offering for their customers’ needs.

“When they are looking for a product, we want one too many offers for them. We want them to see a return because that’s the experience we’ve all gotten used to,” he explained. “If you went to Expedia looking for flights and half the time you got nothing, you’d stop using it because it’s just not fulfilling your needs. Looking outside of the traditional insurance paradigm and really understanding what it is that makes things exciting for you to use in this digital environment, and then bringing it back in I think makes a lot of sense, either as an insurtech or insurance company.”

On the other side of the distribution chain are carriers, and when Dovetail looks at the carrier marketplace, they’re looking for those that are ready to plug into the Dovetail platform and have made the right investments so that their products and processes are easily accessible. In turn, agents can benefit from an Amazon-like shopping experience and have doors opened to carriers that might otherwise be tough to reach.

“A lot of these smaller retail agents just don’t have access to some of these really big name carriers – they fight for appointments, it’s really hard to get appointed, it’s really hard to get access to the products, it’s hard to get attention from the carriers,” said Ferber. “We want to provide that to them, and so the first thing is they’ll get access to the carriers, and the second thing is our real focus is to make sure that no matter what they’re quoting, they get a return, and they can put an offer in front of a potential policyholder because that’s really all the policyholder wants – they want an answer.”

A fast turnaround time is especially important for small business owners, who want agents to come back quickly with offerings since they don’t have a lot of time to spend on buying insurance.

Outside of Dovetail’s work, when Ferber looks at the broader insurtech landscape, he thinks a lot has happened in the past two years, which has been “amazing” to watch.

“I think a lot of carriers have realised that for them, it’s about making their products available and making them easily available,” he told Insurance Business.  “I don’t expect that the exclusive arrangements that have been around in the past will continue. I think carriers are going to want to connect to whomever they can to get the distribution out there and to do it easily.”

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