“If everyone is moving forward together, then success takes care of itself.”
– Henry Ford
You know what they say… two heads are better than one, four eyes see better than two and many hands make light work.
It’s clear that over the last few years, the commercial insurance market has gone through a journey of adopting and integrating insurtech evermore into the fold. A process that has only accelerated during the pandemic, leading to some extremely innovative collaborations and partnerships forming throughout the market.
As insurtech continues to cement its place as an integral part of commercial insurance, with over $1bn being invested into it every month throughout 2021; the way we discuss it is also changing.
The previous and sometimes adversarial relationship insurtech had with the traditional aspects of the market has changed. Words like ‘disruption’ have been replaced by ‘collaboration’, and vital ecosystems are starting to develop.
The collaboration and forming ecosystems follow two paths, collaboration between insurtechs or between insurtechs and traditional market entities.
Insurtech Partnerships
Insurtechs have realised that one of the best and most efficient ways to grow their value and serve their customers is through partnerships with other insurtechs operating in similar spaces.
Insurtechs partnering is a growing trend because it allows them to create ecosystems that can take users through the whole process they are trying to complete, be that the placing process or all the way through to claims.
These partnerships allow insurtechs to entirely focus on the aspect of the process they specialise in, and what their solution is designed to fix. While at the same time, they are providing users with high-quality solutions where they can follow one coherent user flow through multiple solutions. One example of this is the recent partnership announced between Socotra and Sureify to ‘power elevated end-to-end experiences for carriers’ in the life insurance market.
Market Partnerships
In addition to the insurtech partnerships, there is also a significant trend of insurtechs partnering with insurers, MGAs and brokers at a greater pace.
These partnerships are highly beneficial to both parties for multiple reasons. Firstly, there is the diversification of expertise, knowledge, and talent gained through the collaboration of such different companies. The insurance expertise of brokers, MGAs and insurers, when twinned with the agility and tech expertise of an insurtech, is a powerful tool.
According to the 2021 World Insurtech Report, the top 15 insurers globally made 44 deals with insurtechs either by partnership or acquisition during 2020. Also, Lloyd’s has been opening its doors to insurtechs in the form of the Lloyd’s Lab since 2018.
Benefit also comes from the growth of shared networks; commercial insurance has always been a ‘people business’. As insurtechs often engage with multiple aspects of the insurance market, they tend to have extensive networks and can operate as bridges of communication between them.
During the lockdown, we experienced this at SchemeServe where a number of our MGA customers suddenly had their capacity pulled and needed a replacement quickly. In response to this we created our SchemeServe Partner Panel. This panel included a range of insurers with differing appetites who were able to support our customers in finding capacity.
The SchemeServe Network has also allowed Scheme owners to share their schemes to our Library and increase their distribution, whilst brokers can browse and replicate schemes they’d like to adopt.
For collaboration to really thrive in this industry it must be made simpler, and it’s clear that collaborative practises will only grow. However, those who understand ‘two heads are better than one’ and jump on the collaboration bandwagon will undoubtedly benefit the most. In the words of our Commercial Director Sean Neal, “We are constantly evolving because we are learning from our customers …… proactive collaboration has really paid dividends.”
To find out more about how SchemeServe and other market leaders have embraced collaboration during the pandemic, watch this Webinar with the MGAA.
