As insurance becomes more digital, it's not just products that are changing. How insurance firms are structured matters a lot and can be the difference between digitally skinning an existing policy and rethinking a product from the ground up.
Tearsheet sat with Graham Elliott, CEO at Managing Digital Agent Azur to discuss the structure he chose for his firm and how it impacts the delivery of insurance products and the customer experience.
What's an MDA, why did you create it, and what does it enable you to do as your mature?
An MDA is a Managing Digital Agent, a new category of company that combines being an underwriter of product while also having control of tech and making insurance go digital. We believe that companies need to have full control of their technology if they want to be successful in the future -- they will not be able to just outsource it to an external provider. They also need to be agile when it comes to technology adoption and harness digital solutions to create a great user experience.
Unfortunately, only very few companies are doing this right now. Technology is really just another tool, but companies that don’t know how it works will be held hostage to it. Combining both insurance and technology expertise will help us do just that.
What's different about the Azur experience as a customer?
We operate primarily through the broker channel, where the user experience is still governed by a transaction chain that struggles to make efficient use of data. If a broker wants to select a policy for his or her client, they’ll generally have to ask upwards of 40 questions, which can take up to 40 minutes on the phone. Cutting down the number of questions isn’t the answer though. While that may help the user experience, brokers won’t get enough data to pass on to their insurers to make accurate underwriting decisions.
We’ve addressed this issue by developing technology that delivers an asymmetric user experience -- the broker only needs to ask five questions since the data is enriched at the back end with 66 different rating variables. As a result, we can actually bind the risk in 90 seconds. The user -- in this case, the broker -- gets a vastly simplified and much less intrusive insurance journey, and the insurer gets much more accurate and rich data.
What prompted the decision to go through the broker channel?
It seems like every insurtech company looking to be in the transaction chain wants to disintermediate brokers. But brokers aren’t going anywhere any time soon, especially when it comes to niche lines, so we think there’s a big opportunity to help them solve problems. We also don’t think it’s reasonable to try and compete and disrupt the big names in insurance, but we are confident that we can really add value in the broker channel.
What’s the most surprising thing you encountered since founding and running Azur?
The most surprising thing is that everybody claims to know what the new user experience is going to look like and the types of features that are needed to provide a 21st century insurance experience. For example, everyone knows that you have to sort out your data to do that, and get it all in one place, but we’re amazed at how few people are doing anything tangible about it.