As with every subject, InsurTech has cultivated its own thought leaders and we are publishing series of short interviews called “6 Questions with InsurTech Influencer“.
If you’ve been keenly watching the InsurTech space it’s likely that you know these people already, but if not keep watching this space and make sure to follow our interviewees on their Social Media accounts.
Without further ado, it is our great pleasure to continue this series of Q-s & A-s with Spiros Margaris – Venture Capitalist, and ranked Global No. 1 Fintech & No. 2 Insurtech Influencer by Onalytica.
1. Name some of the most promising insurtech startups.
There are many great insurtech companies, but I want to mention here a few I like because of their business models and their potential to be real insurance industry disruptors.
- InsureScan – With this one I am biased, as I must admit I’m an investor in it 😉
2. What is the biggest obstacle preventing insurance startups disrupting the market?
The biggest problem that all fintech and insurtech startups face is getting traction. By this, I mean gaining enough customers that trust their services. It takes a lot of time and money to establish a strong brand with the traditional marketing channels.
Entrepreneurs must find fast and effective alternatives to the traditional path in order to build their strong brand. If startups fail to do so, they run the risk that existing enterprises will take over their business model. Besides, startups are always in danger of running out of money before they see their business grow to its full potential.
On the other hand, existing companies have the brand, the money and the customers, so it is easier for these insurers to implement a great idea successfully. The problem with established businesses is that they are very hesitant to cannibalize their business model unless they have to. Unfortunately, when the time comes when you are forced to do it, it is often then too late to do so.
3. Please explain if you are betting more on innovation from traditional insurance companies or from startups.
It is clear to me that great innovation will come faster and will be more relevant from insurtech startups. These startups are more focused on innovation and fast implementation and don’t have to deal with the huge hurdles that existing businesses face, namely ‘corporate politics’ and ‘legacy thinking’ (not ‘legacy systems’, as is always mentioned).
4. If you were to establish your own insurance startup, what problems would you hope to solve?
If I were to establish my own insurtech startup, I would focus on providing a more affordable and personalized insurance solution that tries to adapt smoothly to constantly changing customer needs and situations, and which even tries to anticipate some of them.
And for my startup credo, I would always emphasize that ‘We respect the clients privacy at all times (period)’.
5. What is your biggest concern regarding the future of insurance?
Actually, I have no real concerns regarding the insurance industry’s future, since I think the insurtech revolution has started and will bring great changes and solutions to customers. The insurtech startups will force the insurance companies to act. We will increasingly see many insurers buying insurtech startups or establishing strong partnerships with startups so as not to lose out in the long run.
6. What will disrupt the insurance sector in 2017?
I would not focus on 2017 alone, but the next five years. The insurance sector disruption or so-called ‘revolution’ has started. Although the insurtech industry is still small in size and impact, it is clear for everyone – from startups to established insurers – that a new insurance world order has started to form and disrupt the status quo.
The fintech and insurtech industries need to put huge efforts into connecting with their existing and potential new customers through social media. Let’s not forget that the platform on which many of the startups want to offer their services will be smartphones and that most people connect more with their social media provider than with their startups. Therefore, startups must find ways to attract customers through the ultimate ‘gatekeeper’, the smartphone.
Spiros Margaris, Venture Capitalist, and ranked Global No. 1 Fintech & No. 2 Insurtech Influencer by Onalytica. Senior advisor and investor in kapilendo.de, moneymeets.de and InsureScan.net. Twitter: @SpirosMargaris
Read also other posts from series “6 Questions with InsurTech Influencer“.