Ping An’s Jon-Tzen Ng: ‘We look at progress in a matter of days and weeks’

In the U.S., when we think about innovation, financial firms don’t generally grace a top 10 list of innovative firms. Not so in China. There, the financial technology firms are regarded as some of the most creative and aggressive firms around, stealing talent from all the top Internet players like Google and Facebook.

Our guest for this week’s Tearsheet Podcast is Jon-Tzen Ng, chief strategy & innovation officer at Ping An Technology, the technology and incubation arm of Ping An. Ping An is a 30 year old, Fortune 100 financial services holding company for the group’s insurance and banking properties, which include online lender, Lufax.

We hear about Ng’s path to running innovation and we move quickly into understanding the Chinese model for innovation — most importantly, we delve into how a company that does over $100 billion in revenue can measure its progress in days and weeks. Ping An has systematized innovation through R&D, incubation, and a new experience design center.

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Below are highlights, edited for clarity, from the episode.

Jon-Tzen Ng began his career at Standard Charter Bank. He was always passionate about technology and in 2007, many banks were looking hard at mobile. A mentor encouraged him to explore fintech more deeply and he was eventually offered a role to create a digital banking team from scratch in China. The country’s economy itself was undergoing a lot of changes at the time — in 2010, companies like Alibaba, Tencent, and Weibo were really starting to take off.

“The challenge for me was that being at an international bank in China limited some of the things I could try,” he explained. Ng jumped at the opportunity to join Ping An in 2016.

Innovation seems to be in the DNA of Chinese financial firms. Ping An sounds more like a Silicon Valley startup than a 30 year old company doing $100 billion in revenue. In his annual letter to shareholders, Amazon’s founder and CEO, Jeff Bezos described a framework of Day 1 and Day 2 companies. Day 1 organizations function with high-intensity, make decisions quickly, and focus on results and not process. Day 2 firms stagnate. “Every day is a Day 1 at Ping An,” said Ng. Ping An doesn’t compare itself to other banks. Instead, it looks to other innovators — firms like Ant Financial, Alibaba and Tencent — to set a baseline of innovation.

Ng lists three things that differentiate Chinese financial services from its competitors in the West. First, speed is crucial in China, where a lot of plans and execution get compressed into short time frames. Rarely do Chinese teams plan for years out — instead, most plans are set on daily, weekly, and monthly timelines. Second, Chinese scale is unique. “If you launch an app and it has five or six million users in China, we would tend to shut it down,” he said. This breeds a lot of competition and copycats out there, looking to do what you do faster and cheaper. “If you want to compete and stay relevant, you have to move at warp speed,” Ng admitted. Lastly, work ethic is a driver of Chinese innovation. It’s not just at the company level, either. With 1.5 billion people in China, everyone is competing with everyone when it comes to competing at scale.

Ping An employs an incubation model to innovate. Incubation generally starts with the chairman, whose vision steers the thinking around a new product or service. A handful of teams from across Ping An’s companies will compete to undertake the development of the new project. This process is then carried forward as the project grows into its own fledgling company. Lufax, a marketplace lender with a multi-billion dollar valuation, began as an internal project at Ping An in 2011.

Ping An doesn’t have a specific group responsible for innovation. It has a cohort of teams and people that sit across the organization that look to drive the company forward. The innovation mindset begins at the top of the company with its chairman and founder, Peter Ma. Ng describes Ma as a visionary in identifying Chinese trends and driving direction for the firm. Ma encourages internal competition, driving urgency within the organization. For Ma, financial services are just underlying needs to primary needs. For example, people want to buy homes — that’s a primary need. The underlying need is that they’ll need a mortgage to finance their purchase.

In the four categories Ping An competes in — finance, health, auto and property — Ping An wants to engage with its customers’ primary needs, before they require financial services, which happens later on in the customer journey. This strategy has succeeded in building an ecosystem of 376 million users of which 137 million customers have purchased one or more financial products from Ping An.

“We are always on the lookout for opportunities inside and outside China,” Ng said. “It’s all about serving our customers’ primary needs. As long as we can help an individual understand themselves better, it will be quite natural that they will have a financial need we can serve. That’s where the opportunities are.”


How drones are changing the way Allstate assesses damaged homes

Just as Amazon’s drone delivery service is transforming retail, drones are making inroads in the insurance industry.

Allstate is using drones to assess damage property damage in Texas, Oklahoma, New Mexico and Colorado, particularly on rooftops — radically cutting the amount of time the process takes.

“What’s amazing is, if you consider the pure drive time of an adjuster taking the picture [on the rooftop] and getting back in the truck and going to the next location, we’re doing two or three locations a day, and with a drone we’re doing eight or nine or possibly more,” said Allstate spokesman Justin Herndon. Allstate is the second-largest property and casualty insurer in the U.S.

Allstate used drones to inspect rooftops of homes damaged by Hurricane Matthew last fall in Georgia and South Carolina. The company said drones cut down the time it took to inspect rooftops, and the pictures they took were high quality 4K-resolution images.

“The images are better than what many people see on television, and you can zoom into a single shingle on the roof,” Herndon said.

Drones are used during a claims process after the first notice of loss, according to Allstate. After the customer gives the green light to have a drone used, the company calls a vendor that deploys the drone. The vendor then sends the image back to Allstate almost instantaneously, at which point Allstate makes a settlement offer. The company has been testing the technology for a couple of years, which as of this spring had moved beyond the testing phase. Allstate plans to expand the use of the technology to other parts of the country.

Around 20 percent of property and casualty insurance companies are currently using drones, a percentage that could double next year, according to Novarica. The uptick in the number of insurers using drones is partly the result of a Federal Aviation Administration ruling last June that set guidelines on drone use by businesses, including the requirement for the drone operators to have passed a drone-piloting exam, along with the need for a visual line of sight between the operator and the drone. Insurance companies may still need to send a person to assess areas the drone is unable to reach.

Allstate is partnering with a startup, Eagleview, to carry out the drone inspections of rooftops. Other startups operating in the field such as Fluttrbox are working with insurers to conduct on-demand inspections of commercial properties by drone.

“It gives consistency for the insurer — it gives them better quality imagery and consistency at a lower price point, ” said Fluttrbox founder and CEO Aristo Mohit-Coker.

A drone can be used to analyze a rooftop at any point of an insurance company’s evaluation process, either after a claim has been filed or to assess risk beforehand. Analysts note that drones can assess properties that would otherwise be difficult to reach.

“They could be not very easily-accessible buildings where they don’t have a lot of information about the construction, or they’re in remote areas, or they’re buildings that are older or are considered risky,” said Jeff Goldberg, svp of research and consulting at Novarica.

Despite the advantages of drone technology, Goldberg said insurance companies must find ways to safeguard the privacy of individuals, especially given that privacy laws vary by state. Ensuring that the public is informed about how drone-delivered property assessments will work should also be a priority.

“Do you want to be known as the insurance company that’s known to be spying on people? Public perception is just important as the law.”

Why insurance technology startups are going to Des Moines

Far from the Silicon Valley hub of financial technology, the next great insurance tech idea may be hatched in Des Moines, Iowa.

Since 2015, insurance technology startups from around the world have converged there to learn how to grow their businesses. The Global Insurance Accelerator is a 100 day early-stage startup program backed by major firms including American Equity, Principal and Mutual of Omaha. They’re working on tools make the claims process run better, and new ways to assess risk and detect fraud. The program will graduate its third class this year, and interest among major insurance carriers continues to grow.

“When you look at insurance companies, at the end of the day they’re data companies, and the products they deliver are virtual,” said Brian Hemesath, managing director of the Global Insurance Accelerator, whose fund offers participating startups $40,000 of seed funding in exchange for a 6 percent equity stake. The program is part of a larger trend where insurance carriers are developing their own venture capital arms to support new products from startups.

Hemesath notes that Des Moines, a major hub for the insurance industry, is a good fit to host the program, given that over 60 companies are headquartered there. Cost was not a driving factor, he said, but the low cost of living allows the program to offer free housing to the cohort. In addition to the accelerator program, earlier this year, ManchesterStory Group, a venture capital firm backed by a group of insurance companies from across the country, just began operations in Des Moines.

The startups are developing products for insurance carriers, including those that improve business processes, security and underwriting methods. The 2017 class includes InsuranceMenu, a platform to help small businesses connect with health insurance providers and RE-Sure, a tool that integrates blockchain technology into the insurance sphere.

Roland Chan, a current participant from Toronto said that in addition to workshops on market strategy, underwriting and regulation, what made the program stand out was the networking aspect. Chan is the founder of Find Bob, a machine-learning powered succession and partnership planning platform for insurance agents and financial advisers.

“The first three weeks were speed dating networking,” he said. “We were introduced to over 90 industry stakeholders, carriers, insurtechs and government agencies.”

A demonstration day later this month and presentations to an international conference of over 450 insurance executives will mark the culmination of these efforts.

Hemesath said some key issues are how to develop better underwriting technology (for example, how to assess a customer without a credit score), data sharing including the exchange of APIs, and how the industry can use data from emerging technologies such as wearables.

While early insurance technology innovations were in the consumer space, Chan said the next frontier for them will be to help large companies more easily deliver their services.

“A lot of the early bets have been made on disrupting the consumer experience, but the next wave is going to be about supporting other aspects of the value chain,” he said. “Insurance is one of the oldest segments of financial services that has had the least amount of innovation in the last hundred years — there’s going to be tremendous opportunities.”

Connected devices find a home in trade finance

The number of devices connected to the internet is steadily growing and expected to surpass 6.4 billion thingamajigs this year, supporting total service spending of $235 billion.

In banking, IoT is still in its experimental stage, which is a bit weird considering ATMs were one of the first devices ever to get connected, way back in the ‘70s. IoT isn’t currently a top priority for banks, but as the IoT ecosystem expands, it will have a significant impact on banking.

The first domino to fall for IoT adoption will be authentication use cases, explains Srikumar Ramanathan, head of solutions group for banking and capital markets at Mphasis. Banks can use mobile devices and wearables to more easily identify a customer, making his experience more seamless, or a staff member, reducing the risk of insider fraud.

The second domino will be in the payment space, through smart home devices, like a connected refrigerator that can replenish food by ordering more when it runs out.

Another example from the payment space might be using connected devices and smart contracts to automatically authorize payments once a connected device registers that a service was provided. A dog walker, to illustrate, can be paid automatically once an IoT device signals the dog walker actually walked the dog for the agreed upon amount of time.

Retail banks are increasingly looking to improve their digital offerings, leveraging customer data and cross sell offers based on predicted customer needs. Through the use of IoT beacons, banks can take these offerings to the next level, delivering offers for products and services when they are most relevant.

Probably the most transformative application of IoT will not be in retail banking but in trade finance, where banks facilitate payments associated with complex global supply chains. “In the same way that shipping companies track raw materials and finished goods, banks could use the same sensors and GPS locators to determine more precisely when payments should be issued and received,” said David M. Wallace, global financial services marketing manager at SAS.

According to Tata, financial institutions reported an average IoT budget of $117.4 million in 2015 , which amounts to 0.4 percent of their revenues. The median reported spend was $6.3 million. The difference between the two indicates that only a small number of institutions are investing substantial amounts into IoT, while the majority are just dipping their toes in the IoT water. Those numbers are slated to increase: projected IoT spend in 2018 is an average of $153.5 million and a median of $26.3 million.

Insurance is probably the most mature financial service to implement IoT. However, customer acceptance of usage-based policies that collect data from IoT sensors has been lackluster.

“The banking opportunities for IoT are worthy of experimentation by the larger banks that have transaction services and trade services businesses,” Wallace said, adding that investments in IoT should not de-prioritize the current, and more pressing, investments in customer experience and existing products and services.

High Five! The top 5 fintech stories we’re following today

5 trends we're tracking in finance

Top 10 things JPM’s Jamie Dimon said about fintech

Start your workweek off right with a roundup of Jamie Dimon fintech gems. While he’s sometimes disparaging of the shady behavior of the startups, it turns out JPMorgan’s chief is very much focused on fintech. For someone who claims that fintech isn’t actually anything different, he certainly has a lot to say about the space: from Silicon Valley to payments to marketplace lending to consumer data, Jamie Dimon will tell you how fintech is changing finance.

Serious contender for the best Jamie Dimon quote ever: When asked about how financial technology is replacing real jobs, JD replies,

“There are downsides to flying — people die every now and then. Do you want to stop all air flights?”

Read more: Dimon can’t stop talking fintech and just dropped a remark that JPM plans to offer free roboadvice to its best clients.

Paypal isn’t a bank, but it may be the new face of banking

In the race to shift services to the web or mobile phones, the stakes are in the billions of dollars for traditional banks and upstarts alike. Paypal has said that it has no intention to upend banks, and that its next target market are the 2 billion plus people who are currently unbanked. Nevertheless, with its popular Venmo unit enabling consumers to take small money transfers into their own hands, Paypal seems very happy to serve banked consumers as well.

As with any new technology that encroaches on traditional banks’ turf (think bitcoin), banks have been quick to point out that due to a lack of government regulation, your money isn’t as secure with Paypal as it would be with a traditional bank. Will that stop the gravitation towards mobile wallet services offered by Paypal and others like Stripe, Square, SoFi, and TransferWise? The Wall Street Journal thinks not.

The road to nowhere: legal cannabis business can’t be solved by fintech

A clash in state and federal rulings has prevented banks from accepting money from cannabis sales. This legal limbo prevents banks from doing business, but more importantly is life-threatening to marijuana retailers; with nowhere to bank, “ganjaprenuers” deal entirely in cash, making them a prime target for thieves.

Fintech has come up with some creative solutions to this state versus federal imbroglio. However, at the end of the day, the problem is a legal one. Until Congress is replaced by robots, tech won’t be the savior for legal marijuana banking.

The march of the bots for customer service: should bank CIOs slam shut or swing open the door?

The emphasis here is on humanizing robots rather than “robotizing” humans, letting those humans who care most about outcomes make sure the end-to-end customer experience is continuously improved.

This means that long-suffering (human) customer service representatives will finally get (robotic) personal assistants to help them proactively find the information they need to use on their computers. In this way, customer service professionals will spend less time searching for things and more time actually serving customers. However, outdated legacy banking systems may prove to be a major stumbling block on the way to this robotic/CRM utopia.

For more on cyborg fintech, read “How quant hedge funds balance computer and brain power”.

AIG enters the crowdfunding market [drops mic]

Insurance exists to reassure and protect policy holders. Whatever may come, insurance says comfortingly – whether car accident, disease, fire, loss, theft, or even death – we’ve got you covered.

Which is why crowdfunding insurance is somewhat of an anomaly. Though AIG just entered the market with Crowdfunding Fidelity, a new crowdfunding insurance policy that will be made available to select crowdfunding platforms, the coverage period and cap mean that the insurance offered is very, very limited.

Bottom line: investors probably shouldn’t breathe a sigh of relief just yet.

Photo credit: Loozrboy via Visual hunt / CC BY-SA

How to sell insurance to young people on Snapchat

selling insurance on snapchat

There are certain youth-focused brands that no one is surprised to see on Snapchat, whether it’s behind the scenes footage from Marc Jacobs, or sponsored lenses from Taco Bell. What you don’t expect to see, though, are snaps from insurance companies.

But Danish insurance company Alka has had success on the platform, having just finished a three-month campaign posting weekly Live Stories and competitions — reaching a demographic it’s previously struggled to communicate with.

“Insurance and young people don’t go hand in hand, they don’t really see the point in spending the money,” said Hans von Haffner, client director at ad agency Fireball, which was behind the campaign. “And Alka isn’t an interesting brand to follow, unless there is a perk involved, so we wouldn’t use paid-for advertising on Snapchat.”

In Denmark 48 percent of people between 12 and 29 years old are using Snapchat every day, it’s the fastest growing social media platform, according to Denmark Radio’s report on Danish media consumption. Alka’s new €12 monthly plan ($14), covering all personal belongings for 21-30 year olds, needed to reach that audience in an organic, non-intrusive way. “We thought, ‘how can we not interrupt the users while still getting leads?’” Fireball’s community manager Ulrik Nøhr, told Digiday.

Each Wednesday from January to April, the team on the campaign — a community manager and two creative directors — brainstormed the short video narrative, storyboarded and shot it before publishing at around 2 p.m., keeping it quick and simple. In total they shot 12 30-second films, all centered around someone losing or having an item stolen; a bike, a laptop or a handbag.

Followers who took a screenshot of a orange item in the film (Alka’s brand color) and sent it with their name and number were eligible to win a prize — generating 774 leads for Alka in the process.

“While younger people may not own lots of possessions, the ones they do they have a strong emotional attachment to,” said Nøhr. “The stories had to connect with the Snapchat platform; when those things disappear, like everything does on Snapchat, it sucks not to have insurance.”

selling insurance on snapchat
stolen flowers

While 774 names and numbers may be a relatively small number, the engagement was high. Half (49 percent) of them interacted with the brand; Alka’s agency team made sure they responded to each submission. More importantly, they bought insurance. Alka was tight-lipped on the conversion numbers, though, adding it was more “efficient conversion” than other direct marketing or social media efforts.

“We were unsure how many people would engage, the fact we got anyone to follow us was a big step,” said Alka marketing consultant Thomas Flygare, “the way they responded to interactions was amazing to see.”

Like with all Snapchat Stories, a key challenge is getting people to follow the brand. Alka has a weak social media presence, with a handful of Twitter followers and 14,000 likes on its Facebook page. Instead it worked with Danish trade unions, like HK, to promote the Snapchat campaign, and ran Facebook ad campaigns targeted at union members.

This summer Alka will get back on the platform, running competitions around festivals and summer holidays, highlighting situations where it can hurt to not have insurance.

A version of this article originally appeared on Digiday.

Photo credit: AdamPrzezdziek via Visual Hunt / CC BY-SA

Lemonade, insurance, and banking mashups

P2P Lending's Developing Debt Market


Lemonade, the hiring-like-crazy, raising-money-like-crazy, getting-PR-like-crazy insurance startup just added another big name to its roster. In addition to the minions of execs the company recruited out of AIG, the p2p insurer just hired behavioral economist, Dan Ariely. The Duke professor is probably best know for his wacky, creative experiments that populated the pages of the books he’s written about our irrational financial behavior.

Ariely’s role at Lemonade is technically titled “Chief Behavioral Officer”. So, ostensibly, his role will be to help develop the user aspects of the insurance platform to ensure it provides enough billion dollar triggers to get users addicted to the platform and turning to it for repeated dopamine hits.

“If you tried to create a system to bring out the worst in humans, it would look a lot like the insurance of today,” Ariely said in a statement. “We’ve spent recent years deepening our understanding of honesty and trust, and our conclusion is that insurance is crying out for a makeover.”

While the hype machine is working overtime, we don’t have a lot of details yet what p2p insurance (or at least, Lemonade’s flavor of it) really looks like. We aren’t without clues, though. We do know that there is some type of reinsurance scheme (Buffett’s Berkshire Hathaway has its hands in it) and the firm has said that it won’t make money by denying claims. So, if in fact, the firm is collapsing the 3-tier insurance stack, it will have to allay fears that the company won’t be around to payout when a claim is made. The big funding round, the name-brand reinsurers, the executive migration — all may be necessary parts of the Lemonade gameplan.


A couple of years ago, Simple (then called Bank Simple) was billed to be the future of banking. Simple was a really nice user interface that sat on top of the banking stack but never quite impacted the industry the way some had hoped.

Number26, a Peter Thiel-backed next generation German bank, is another attempt at creating the bank of the future. Instead of building a vertically-integrated bank, some banks like Number26 are taking the mashup approach: integrating with various services and product providers to provide more comprehensive service. Number26 is integrating Transferwise, a p2p currency exchange, so that clients of the bank can exchange currencies easily within their accounts.

Marc Andreessen, founder of Netscape and considered by some as smart VC money, once boasted that he’d fund anyone who wanted to start a full digital bank. That spurred a pretty vigorous conversation about whether a truly disruptive bank needed to be built completely from the ground up or a virtual bank could be produced by doing away with branches and just creating digital hooks into banking infrastructure.

Because of the costs and complexities in building a full banking technology stack from the ground up, many banking startups, like Number26, are taking the approach of integrating their money apps into other non-financial apps (like Qapital recently did by integrating on IFTTT). This can essentially take a banking app with limited functionality as a standalone and back it into being a much more robust offering.

Number26’s co-founder and CEO Valentin Stalf says its ambition is to create a single app that integrates the services of multiple fintech startups, providing an aggregated showcase for the best emerging alternatives to traditional banking services on a single screen.

Francois de Lame of PolicyGenius on how to build a digital-first insurance brand

francois de lame, PolicyGenius

Francois de Lame is co-founder and Chief of Marketing of PolicyGenius

What is PolicyGenius and where did you get the inspiration to create it?

Francois de Lame, PolicyGenius
Francois de Lame, PolicyGenius

PolicyGenius is  an online marketplace for insurance that offers self-directed consumers open access to unbiased insurance information, tailored recommendations, and transparent quotes. PolicyGenius goes beyond what today’s aggregators and online agents offer by providing the best customer experience possible, with engaging educational material, decision support tools, and honest advice in a fully transparent manner every step of the way. We have brought consumer insurance into the 21st century with instant, accurate online quoting and smart digital advice tools to solve the obstacles created by America’s outdated insurance industry.

PolicyGenius is not directly affiliated with any one insurer. Instead, we have vetted and partnered with dozens of the nation’s top insurance companies for our platform.  All of our advice, quotes and educational guides are focused on our customer’s needs. PolicyGenius is not a lead-generator, and we will never sell your data to a third party, or make you give us your contact information before you can see a quote. We work with our customers the way we’d want to be treated to ensure they get the best insurance for their needs.

My co-founder and I were inspired to build PolicyGenius after having served many large insurance companies at McKinsey & Company. We were brought in on numerous occasions to help them think about how to reach a more digitally savvy consumer who was not interested in sitting down face-to-face with an agent to talk about insurance. The US insurance industry has historically relied on agents and operated under the assumption that “insurance is sold, not bought”. While this is slowly beginning to change, we didn’t see it happening fast enough. We started PolicyGenius to challenge this mantra and to prove that with smart digital tools and a transparent process, consumers would readily adopt digital channels to research and purchase insurance.

Why is buying insurance so complex and frustrating?

I believe the industry, particularly agents, would like you to believe that it’s complex, thus proving the value they bring. For some insurance decisions — for example, purchasing whole life insurance — I tend to agree that an agent or financial advisor should be involved in the decision making process. However, for many insurance products, this face-to-face interaction is not necessary. The industry continues to force consumers into this heavily-mediated way of doing business, which is not how many of us want to interact with insurance.

Another source of frustration is lead generation, which unfortunately dominates the business models of many online insurance verticals today. Consumers are forced to enter their contact details even if they just want to see a quote, and then they receive multiple sales calls from different agents.

No one in the US has truly set out to create a multi-product independent insurance distribution platform before — one that helps consumers understand how insurance fits into the context of their financial lives.  Historically, the customer of the insurance industry has been the agent and this needs to change. The key to success in the next decade is to focus on the consumer. By bringing more transparency to the process and giving consumers the tools to shop for themselves,  we believe much of the complexity and frustration can be removed.

Why does it feel like so much less innovation has happened in insurance vs. some other consumer industries out there?

Insurance is a tough industry for outsiders to jump into. It’s heavily regulated at the state level and you need a deep knowledge of the products and processes to be successful. Crucially, you need to have strong relationships with your insurance partners. From day one, we focused on developing our relationships with carriers. They’re the ones who have built trusted brands over many years, something that we knew we would need to leverage  in order to succeed.

What makes things harder for new entrants is that not only are you selling consumers an intangible good that they hope to never use, but as a new entrant, consumers will automatically be skeptical of you. If I were to start up a life insurance company today, you’d need to believe I’ll still be around in 30 years in case you need to make a claim.

Because of these constraints, I believe incremental innovation is what will bring large changes in the industry. This is not a particularly enticing proposition for technologists and venture firms looking to turn an industry on its head in 12-24 months. But for those who are willing to play the long game, and who have a clear understanding of where the problems in the industry lie, there is huge opportunity to deliver significant customer value and build a successful business.

As Internet-enabled insurance grows, are we going to see the market structure change? I’m thinking most about the role of agents.

We believe in providing the channel of choice to consumers. What this means is that consumers should be able to choose the channel through which they engage their insurer or agent. Many consumers still prefer to meet face-to-face with an agent and I don’t believe this will ever disappear. However, the industry needs to invest more in opening up digital channels, since for many consumers this is how they want to manage their financial lives. Many in the industry see this as a “millennial” issue, but  I believe this is misguided. Across generations, many consumers are now digitally savvy, and therefore, it is imperative that the insurance industry caters to them.

The urgent need for these new distribution channels is compounded by the fact that a large proportion of the current  agent force is nearing retirement. Without new channels, insurers are going to find it harder to distribute their products.

It’s hard in general to distribute consumer products and even harder/more expensive to acquire financial customers. How do you think about acquisition? What’s working, not working?

Our focus is on building a long term relationship with a client, such that we’re always top of mind when it comes to them making an insurance decision. We use content to develop this relationship and build trust with a client. In this industry, it’s incredibly important to understand the purchasing funnel and what influences someone’s behavior. By understanding what customers are looking for, and where they might be looking for it, we’re able to target our marketing efforts and tailor our messaging.

Our marketing efforts are focused on building a long-lasting brand that is synonymous with independent insurance advice and shopping, thereby increasing the effectiveness of our acquisition as we scale. The most important aspect of marketing, however, is to provide something of value to the consumer. The service we have created fills a gap in the market and solves a major point for many consumers.

Photo credit: Asim Saeed (Misa Khan) via VisualHunt / CC BY

trov’s Scott Walchek on designing the world’s first on-demand insurance for single items

trov inventory and insurance app

Scott Walchek is CEO and Founder of trov

What is trov and what was the genesis story? What was the inspiration behind starting it?

Scott Walchek, trov
Scott Walchek, trov

Trov is an application and digital insurance platform that together reinvent the way people insure their things by harnessing the information about all they own. Designed for the emerging generations of digital natives, Trov completely redefines the way people protect their possessions by letting them choose just the things they care to protect, and engage insurance for as long as they need it – a year, a month, a week, day, hour…whatever.

Together, the Trov app and platform enable the world’s first on-demand insurance for single items and feature micro-premiums, micro-duration policies, and entirely disintermediated claims – all from a smartphone. This “streaming insurance” will empower numerous new use cases including automatically turning-on protection based on date, time, location, and event.

In 2010, for the first time in history the make up of Global Household Wealth was evenly split between financial assets (cash and its myriad equivalents), and tangible assets (personal and real property) [from 2011 Credit Suisse Wealth Databook]. It intrigued me that while there were innumerable tools for analyzing and managing financial assets, there were no similar and simple tools for managing tangible wealth. That intrigue was followed by a recognition that there was enormous value latent in the information about the things that people own – and if we could capture that information and give people agency over it on their mobile devices, then we could positively impact numerous substantial markets. The first of these market disruptions would be in the P/C insurance space where emerging generations were demanding their financial services be delivered on their mobile devices, on-demand, and a la carte.

Insuring belongings has traditionally been hampered by the inefficiency of cataloguing all our stuff. How does trov change all that? And in doing so, how does the role of insurance change?

One of the biggest problems with traditional home contents insurance is that people pay a set amount of money year on year, without many questions, yet are often unsure what is actually being covered. We frequently hear of incidents when people report claims for their belongings and then their most valuable items are not actually covered.

Trov provides on-demand protection for the things that are important to you and you always know exactly what is covered and in what situations. Instead of trying to document all of your important items after an incident occurs, Trov makes it ridiculously easy to collect and update information about the things that are important to you – as you acquire them. You are then given the option to easily “swipe to protect” the items that are most important to you and then easily “swipe to unprotect” items that you may have discarded, sold or have lost value to you.

Furthermore, we’re working on opportunities for adaptive protection that is adjusted based on your situation. Imagine having insurance for your skis turned ON automatically when the ski season begins and OFF in the Summer, when you no longer need the same level of insurance.

The role of insurance will change from a once-a-year transactional relationship to a more active ongoing relationship with your things –  protecting just what you want, when you want – so you can get back to enjoying them.

What were some of the challenges in making insurance as easy as interacting with our phones? How did you solve for them?

Trov is 100% mobile, meaning it has no desktop/browser version.  This is a self-applied constraint that has forced us to be very selective in the features we introduce. Furthermore, by keeping the application entirely mobile, it has actually allowed us to introduce more unique features that are only available on mobile devices. These include things like taking photos with the app, detecting location for your home, scanning barcodes and receipts. If we had a desktop version, then none of these features would be possible.

Insurance today is bogged down by heavy process and forms, often requiring the need to talk directly to a person. By moving the entire process to the phone we’re making getting insurance as simple as a ‘1-click’ Amazon purchase. What’s more, claims can be as simple as a quick text message exchange with reimbursement or shipping of a replacement item happening in minutes – instead of days or weeks.

By placing the entire insurance process on a phone, we quickly realized which processes were absolutely necessary and which were simply functions of an arcane insurance model. Needless to say, we discarded what wasn’t necessary and made the entire process much simpler.

What’s in store for 2016 for you and trov?

In 2016, we will begin to roll out our on-demand insurance platform.  Limited release launch will take place in Australia and the UK in the first half of 2016.

Photo credit: Seattle Municipal Archives via / CC BY

Protect your downside and follow these 20 top insurance startups in 2016

top insurance startups

Insurance as an industry has been one of the last to be reimagined in the Internet era. That’s all changing now: entrepreneurs and institutions are investing heavily to turn out the next generation of insurance companies from the ground up. Institutional capital is betting that this new class of insurance companies will make a dent in the multi-trillion insurance industry.

Industry experts like Santander’s Pascal Bouvier point to insurance tech as one of the last, and ripest, fields for investment capital in 2016. Indeed, in 2015, over $800 million of risk capital was invested into startups in the insurance technology, now called, insurtech, space.
2015 insurance tech investment trends

Here’s a quick rundown on the state of fintech, investments, and the digital disruption of the insurance industry:

    • The US insurance industry accounts for $1 trillion, or approximately 7 percent, of gross domestic product (US Treasury)
    • At $831.5 million, investment in insurance tech this year is already up nearly 10 times what it was in 2010 (CBInsights)
    • 1 in 4 insurance agents will be gone by 2018 (Insurance Business America)
    • 47 percent of households couldn’t cover an emergency expense of $400 (Report on Economic Well-Being)

Insurance technology is a broad field that includes all different types of insurance, distributors, risk and regulatory managers, big data and enabling technology.

map of the insurance technology startup field

One of the things that makes this surge in interest and money backing insurtech startups is that it’s bring driven by outsiders. The same disruptive force emanating from Silicon Valley that’s changing transportation and logistics (Uber), music consumption and distribution (Spotify), and travel and lodging (Airbnb) is now turning its sights on one of the oldest and largest economic sectors: insurance. We’ve seen both industry insiders and talented outsiders enter the industry and expect that trend to continue.

We’ve compiled a list of the top 20 insurance startups worth keeping tabs on throughout 2016. Compiling top lists are tough — like in most fields, there are way more than 20 companies that deserve such recognition.  The methodology we used in compiling this list included startups who’ve raised over $2 million, had a strong signal ranking on AngelList, and had a relatively robust Crunchbase profile. We also attempted to create a broad list that was inclusive of different approaches to impacting the insurance industry and therefore, we limited the number of startups doing something similar (say, direct distribution to consumers, for example). So, to that extent, this is a subjective list. For those that didn’t quite fit but were worth noting, we created an Honorable Mention category at the end of the list.

Top Insurance Startups

View more lists from Zack Miller

Photo credit: Ninian Reid via Visual Hunt / CC BY