Insurance Business America Executive Insights Series Insurtech 2021

EXECUTIVE INSIGHTS SERIES

INSURTECH 2021 How insurance technology can help meet the demands of a post-pandemic world

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INSURTECH 2021

INSURTECH 2021 How will insurtech transform the insurance ecosystem in 2021 and beyond? IBA spoke to the leaders of four innovative companies to find out

FOREWORD FOR DECADES, the insurance industry has been riddled with paper-driven manual processes, often creating inefficient workflows and poor customer experiences. And then, almost overnight, COVID-19 changed everything. For many agencies and carriers, the pandemic amplified inefficiencies in their existing business, forcing them to take a hard look at their processes and the technologies that underlie them. In fact, the adoption of new technology, driven by remote working, grew at a tremendous rate, with years of digital catch-up happening in mere months.

In this rapidly changing environment, the insurance ecosystem must embrace technology like never before to become more productive, intelligent, simple and valuable. For these reasons, we at Applied felt it was important to support and promote the

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following report, which is focused exclusively on technology in the insurance industry.

This report examines all aspects of insurtechs – where they’ve been, where they currently are and where they’re going – and provides valuable insight for our industry. Agents, brokers, carriers and software providers should use this resource to learn the landscape and decide what kinds of technology to adopt to create greater value for their business and enable a more efficient and connected insurance ecosystem for all stakeholders.

Taylor Rhodes CEO Applied Systems

IN LAST YEAR’S insurtech report, IBA predicted that the COVID-19 pandemic would force the industry to adopt new technology to deal with lockdowns and remote working arrangements – and it did. As a result, insurtech investment surged: By the end of 2020, insurtech had gathered a record $7.1 billion in global investments, according to Willis Towers Watson.

“While our industry is facing extreme issues [relating to COVID-19], we also have an unprecedented level of access to technology and technologists who can help us

solve these problems,” Dr. Andrew Johnston, global head of insurtech at Willis Re, wrote in Willis Towers Watson’s Quarterly Insurtech Briefing for the fourth quarter of 2020.

“Many insurtechs probably feel vindicated that our industry has been forced to realize the value of technology; their issue now, however ... is to survive months (possibly years) of market uncertainty.”

What’s ahead in 2021?

With $2.1 billion in funding from the last quarter of 2020 alone, today’s insurtechs find

As COO for QBE North America, Dan Moore serves as head of claims, technology and operations and oversees communications and branding, with the goal of strengthening QBE’s customercentered approach as an integrated specialist insurer. Moore has more than 20 years of experience in the insurance and consulting industries. He was appointed interim COO in January 2020.

Taylor Rhodes CEO Applied Systems

As CEO of Applied Systems, Taylor Rhodes is responsible for the company’s overall strategy and operational execution. Rhodes joined Applied in 2019 after serving as CEO of SMS Assist, the leading cloud-based software platform for multi-site property management.

Prior to that, he was CEO of Rackspace, where he led the company’s growth from a cloud pioneer to an industry leader.

• shifting to digital channels for everything from writing signatures to identity recognition to meet high consumer demand for remote services • using no-code or low-code development tools to facilitate the rapid launch of new user interface features • leveraging AI software to automate processes such as risk assessments, fraud identification and underwriting

MEET THE EXPERTS Dan Moore COO QBE North America

themselves in the driver’s seat, able to meet traditional needs while pushing the boundaries of innovation.

As IBA recently reported, tech leaders have identified several emerging trends in insurance technology this year, including:

Amy Zupon CEO Vertafore

The CEO of Vertafore since 2016, Amy Zupon has two decades of experience in the B2B software industry and a passion for providing an exceptional experience and products that deliver real value and performance for Vertafore’s customers.

Her approach drives Vertafore’s vibrant company culture, which inspires employees to innovate and be creative to solve customers’ ever-changing needs.

Jason Liu CEO Zywave

Jason Liu joined Zywave as CEO in 2018, charged with overseeing daily operations and driving the company’s long-term vision and strategy. Liu has more than 20 years of experience leading organizations across the world, from the US to central Europe and back. Prior to joining Zywave, he served as CEO of SAVO, UC4 Software and Univa UD.

• using the Internet of Things (IoT) to gauge policy pricing • forging new partnerships between insurtechs and insurance providers to leverage strategic advantages • deploying blockchain technologies to protect against cyberattacks • providing tailored digital services to increase policy sale probability At this point, confidence in digital capabilities has grown, and nearly all companies have implemented a business continuity plan that relies on advanced technology. Both insurance companies and consumers have seen the benefits of the digital world as a vast majority maintain some level of remote living and working capabilities. Employees recognize the importance of even a basic content management system (CMS). Agents and brokers have embraced the latest technology, such as streamlined commercial quoting systems, to survive. And consumers expect the best digital experiences.

All of these factors combine to make for a bullish insurtech market over the next few years. But what’s in store for the next 10?

Science fiction to science fact According to a recent report from McKinsey & Company, many of today’s emerging technologies will have fully developed by 2030.

The report envisions “Scott,” an imaginary

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INSURTECH 2021 character who leverages the latest advancements in technology to optimize his return on insurance. Scott hops in a self-driving car, where his personal digital assistant and mobility insurer map his route and recommend a path based on accident likelihood and car traffic distribution, instantly revising his monthly premium accordingly. At the same time, his pay-as-you-live life insurance policy recalculates as well. Both adjustments are debited or credited to Scott’s bank account.

After a minor accident, the car’s internal diagnostics determine the damage. Scott’s assistant recommends he take pictures of the area. Almost immediately, the claim is approved, and a mobile response drone is dispatched to the site for further inspection.

“While this scenario may seem beyond the horizon, such integrated user stories will emerge across all lines of insurance with increasing frequency over the next decade,” the report’s authors wrote. “In fact, all the

landscape and the impact of technology on the insurance industry at this point in history.

Insurtech funding bounced back in the second half of 2020 after a rough start to the year. Where does the landscape sit now, and what are the key developments in the space?

Taylor Rhodes: While insurtech funding was low for the first half of 2020 due to a variety of reasons, with the pandemic as a major one, the second half of 2020 and the beginning of 2021 have shown that investors are becoming more confident again. Now that businesses have put their business continuity plans in place and are operating in the new normal, investors see that the insurance market is ripe for opportunity. As more

“Insurtechs that control and enhance distribution are the kinds of companies that investors will be investing in” Taylor Rhodes, Applied Systems technologies required above already exist, and many are available to consumers. With the new wave of deep learning techniques, such as convolutional neural networks, artificial intelligence has the potential to live up to its promise of mimicking the perception, reasoning, learning and problem-solving of the human mind. In this evolution, insurance will shift from its current state of ‘detect and repair’ to ‘predict and prevent,’ transforming every aspect of the industry in the process.

The pace of change will also accelerate as brokers, consumers, financial intermediaries, insurers and suppliers become more adept at using advanced technologies to enhance decision-making and productivity, lower costs, and optimize the customer experience.”

With the full capabilities of the future in mind, IBA spoke to a panel of insurtech experts to provide an overview of the current

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people work remotely and need digital technology to connect to their organizations and their customers, the appetite to invest in technology rises.

According to Deloitte, insurtechs that control and enhance distribution are the kinds of companies that investors will be investing in. This makes sense, as we have seen how remote working has exacerbated challenges caused by traditional paper-laden workflows of agent-insurer distribution. To this end, insurtechs, insurers, investors and software houses, such as Applied and IVANS, have come together to digitally transform the agency-insurer distribution channel to increase connectivity, reduce expenses and enhance end-customer experiences.

Dan Moore: COVID-19 posed an initial challenge for the insurtech marketplace.

While there was a slight decline due to the

pandemic, the second half of the year hit record levels of investments, and we are seeing an increase in investment, M&A and, more recently, SPAC activity. With significant capital still on the sidelines, and given the size of the insurance prize, there will continue to be significant activity surrounding firms that are seeking to enable better decisions, improve outcomes and enhance customer experiences.

Amy Zupon: There’s no question that the first half of 2020 was rough all around, for just about every industry and business sector.

But in the second half of the year, we saw a truly remarkable shift in the insurtech funding landscape. It didn’t just defy the circumstances of the pandemic – in some ways, it even outpaced what we’ve seen in previous years.

In the latter half of the year, a number of

opportunity insurtech represents, the appetite of customers – both agency and carrier – and the interest of investors in this space.

COVID-19 ultimately highlighted a few things to those investing in the insurtech space. First, it accelerated the push for agencies and carriers to invest in the right digital solutions to meet customer and employee expectations.

After the initial contraction, many independent agencies and carriers quickly turned to technology to ensure business continuity and to continue to service their clients.

That being said, 2020 also showed that there’s still a lot of opportunity for technology innovation and adoption for both carriers and insurance agencies. When it comes to agencies especially, now that many of them have gotten a taste for modernization, we’ll see more openness to change – and even excitement about emerging solutions. That’s going to continue to drive opportunity for investors who bring solu-

number of players looking to find innovative ways to streamline the current tedious manual processes and connect agents and carriers.

Another key development in the space is integrations. Insurtech companies are finding ways to work together to enable brokers to use the solutions they want but keep their tech stack connected to help eliminate redundant data entry and improve efficiency.

How has the mass shift to remote working impacted the insurtech landscape?

Jason Liu: The abrupt transition to remote work has positively impacted the insurtech landscape by requiring many more agents and brokers to embrace technology. Many insurance professionals, prior to having to work remote, relied on old-school methods to

“Now that many [agencies] have gotten a taste for modernization, we’ll see more openness to change – and even excitement – about emerging solutions” Amy Zupon, Vertafore marquee insurtech carriers received some very large infusions, and that was coupled with some big rounds on the back of successful IPOs. In addition, we saw a lot of investment in seed-stage companies that are looking to bring new solutions to the insurance industry – particularly around data and analytics, artificial intelligence and machine learning, and sales and service technology for brokers.

As we look to 2021, that’s a dynamic we can expect to continue. Investors and entrepreneurs are really interested in investing in ideas. The caveat to that trend is that the industry will look for concepts that really bring value and efficiency to the distribution channel and then get behind them with the dollars to enable them to come to fruition.

Ultimately, the surge in investment we saw in the second half of 2020 is a testament to the

tions with real value to the channel.

Finally, the pandemic really proved out the stability of the insurance industry. Many players in the insurance channel reported strong outcomes – and even substantial growth – in 2020. Investors saw that and responded in kind.

Jason Liu: Insurtech proved to be very resilient to the challenges created by the pandemic. As agents and brokers pivoted to remote work, they looked to technology to help with this transition. Those who quickly embraced and adopted insurtech solutions were more successful. Currently, investment is high, with carriers, VCs and PEs pouring money into the space to help drive growth and innovation.

Many of the developments are centered around commercial quoting, which has a

perform their jobs. This included in-person meetings, which now can be conducted remotely, anywhere, any time. That flexibility has enabled many brokers to write new business outside their typical geographic areas.

The adoption of technology due to remote work has also positively impacted agencies by requiring them to implement other technology like content management systems to enable employees to access all their required resources in one centralized platform. Previously, the content agents needed lived in various disparate locations.

In general, the shift to remote work has increased the adoption of insurtech by many agents and brokers. Technology is now seen as essential by many more insurance professionals. This has led to growth for insurtech providers, and insurance profes-

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INSURTECH 2021 sionals are looking to insurtech as more of an essential partner.

Dan Moore: While insurers have traditionally been viewed as slow to adapt, COVID-19 required firms to quickly adopt new processes and technology in order to continue serving customers and support partners and employees during this period. Many insurtechs were well positioned to assist the industry to step out of its comfort zone and leverage technology in new ways and at a pace they had previously not thought possible, which bodes well for the future of change.

Taylor Rhodes: Remote working has accelerated digital transformation for the entire industry, especially insurers. Insurers have looked to insurtechs to fuel their innovation and accelerate efforts to modernize technology infrastructure, improve data capabilities and create digital experiences for their employees, agency partners and end customers.

Agents, too, have fast-tracked their digital strategies to adopt technology that will enable better connectivity throughout their organization, such as hosting their business in the cloud. As customers were no longer

able to meet with their agents in person and digital-first interactions became a mainstay, agents turned to insurtech to create digital customer experiences to better serve their policyholders.

According to KPMG, the insurtechs in the ‘enabler’ category – those that provide B2B point solutions that are designed to improve an aspect of an insurer’s or broker’s value chain, such as data algorithms or mobile apps – stand to win if they closely align with current priorities. An insurtech like Indio is a good example of an enabler insurtech that saw a need in the market – to digitize a traditionally paper-laden manual task like application management and submission – and found success through acquisition.

Another type of insurtech laid out by KPMG that is expected to do well thanks to remote working is the ‘partner’ insurtech – those that typically go to market together with traditional insurers. As insurers are investing heavily in their digital transformations to enable a more connected experience for their employees, agency partners and policyholders, partner insurtechs that are focused on accelerating digital transforma-

tion efforts will be successful.

Amy Zupon: Each year, Vertafore surveys independent agents about the state of the insurance workforce, and this year, upwards of 70% of agency employees said they transitioned to some amount of remote work during COVID-19. The good news for agency owners: Most employees said they had the technology they needed to be effective while working from home.

That being said, the almost immediate shift to remote working forced every agency – but especially smaller agencies – to speed up their adoption of technology and modernization strategies to find new ways to stay engaged and connected to their clients. For

“Many insurtechs were well positioned to assist the industry to step out of its comfort zone and leverage technology in new ways and at a pace they had previously not thought possible” Dan Moore, QBE North America some, the transition was seamless, and for others, it has been a real challenge. The abrupt change to working from home also highlighted that the best, most valuable technologies are user- and client-centric as well as interconnected. No matter how innovative a new technology might be, it is ultimately worthless if it is not intuitive to its intended user and does not connect with the other systems agencies rely on.

In many ways, the pandemic increased the tempo of business and fundamentally changed the expectations of consumers. For

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insurtech providers, it is more essential than ever for us to build solutions that reduce friction in the distribution channel to facilitate that new speed.

But just as importantly, technology providers need to ensure users have the resources they need to make the most of their solutions, no matter where they are. Early on in the pandemic, we took a look not only at our product development, but also at our customer success program to determine how to best assist our customers through new needs and challenges. Regardless of a customer’s size or where they are on their path to modernization, it is on us to ensure they are able to get every ounce of value out of their solutions. That means having support staff dedicated to and really invested in our customers’ success.

How can insurtechs help insurers compete in terms of the digital experiences they offer customers, and what are the operational priorities insurers should be turning to insurtechs for?

Dan Moore: The opportunities are endless.

At QBE, our QBE Ventures arm invests in and builds alongside early-stage technology companies that we believe have the potential to reshape the insurance industry. We leverage QBE’s market strength and expertise and augment these with emerging technologies to create new value for our customers, partners and the communities in which we operate.

We like to look for insurtech opportunities that will instantly enable us to provide efficiencies and/or enhanced customer experiences. A great example of this is TextQBE, which was developed using HiMarley. The artificial intelligence-based conversational service platform provides an alternative channel of communication to improve the customer experience, reduce cycle time, and reduce expenses and indemnity dollars. That directly improves the customer experience.

An example on the efficiency side is our

investment in RiskGenius, which applies artificial intelligence to insurance policies so we can evaluate an entire portfolio of insurance policies for emerging risks in seconds.

Amy Zupon: So often in the tech world, someone will build a really slick, exciting new technology – a shiny new object. And the technology could be great and the design beautiful, but ultimately, is it creating value for the customer? That’s a question we invoke often at Vertafore to make sure we’re developing solutions that really meet the needs of the insurance distribution channel. And insurers need to posit that same question in relation to tech experiences for both their end insureds and independent agent partners.

We know carriers need and want to know their end insureds better. They have traditionally relied on their agent channel to provide information about their end customers, and while this view is important, it can also limit their ability to develop the unique, tailored experiences that consumers expect. Insurtech can harness the power of data analytics to help insurers better understand their insureds and use that understanding to build better customer journeys.

When we talk about insurtech, people tend to think first about the direct-toconsumer model. The reality is that with 36,000 independent agencies in the US servicing millions of clients, the agent role in insurance distribution is absolutely essential.

So carriers also need to understand their channel partners and how they can better support the agencies they work with – how can they be more responsive, provide better agency experiences and be easier to do business with.

Insurtech is key to facilitating the agent experience to help carriers better connect with their channel and to solve the common headaches around compliance, onboarding and compensation. When carriers solve those issues, they become a partner of choice and get more bites at the apple when it comes to new and renewal business in the agency channel.

In addition, the right technology solutions can equip insurers to provide more insights into tracking and process management for

WHAT IS INSURTECH, ANYWAY? First emerging around 2010, insurtech is the software/IT/ technology ecosystem that’s focused on optimizing services and solutions for the insurance industry.

Examples of insurtech solutions include online policy comparison services, AI-enabled claims processing and digital platforms that are modernizing legacy insurance companies.

There are more than 3,475 insurtech companies globally, 44% of which are located in the US More than 1,500 insurtech companies have emerged in the last five years Insurtech companies raised $5.4 billion in venture capital funding in 2020 VC funding for insurtech companies in the last decade has grown at an average of 89% yearly There were 81 insurtech acquisitions in 2020 – the highest number on record Source: Porch Research

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submissions, more insight into the claims process, and help agencies upload information into the carriers’ systems more easily.

Ultimately, insurers should be looking at insurtech that can enable them to move faster, be more agile in terms of the products they deliver to market and be more responsive to

business. These portals can be a competitive differentiator if they leverage them to offer valuable information on topics like safety or regulatory updates. Creating a digital platform where policyholders can self-service and educate can be a great area in which insurtech can help.

“Leveraging technology to support remote/ digital work will be essential for the foreseeable future. Many buyers of insurance will remain remote or hybrid indefinitely” Jason Liu, Zywave agents – all of which goes to enabling agencies to meet the expectations of their clients and making insurers a partner of choice.

Jason Liu: Policyholders expect a digital experience when conducting business with their insurer. They pay premiums, file claims and review their policy digitally. To support this, carriers must offer a robust portal or mobile application where their customers can engage with them and perform any insurance

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On the broker side, insurers need to enable their agents to sell and service more efficiently and effectively. Offering a robust distribution management system can help streamline the way agents and carriers exchange information. Insurance requires a lot of documents and data, and providing a way to make these seamlessly flow between the two parties can be assisted by insurtech.

Taylor Rhodes: The pandemic has accel-

erated insurers’ digital strategies, directing their attention to insurtechs for support as they enhance distribution with their agency partners, in commercial lines particularly.

Historically, commercial lines distribution methods have been extremely manual and time-consuming for both insurers and agents, requiring back-and-forth communications to complete and submit applications and then requiring the agent to potentially wait weeks to receive a quote.

Insurtechs like IVANS, Indio and others are working together with insurers to create more effective and efficient workflows for all stakeholders. Through a single point of connectivity, insurers can connect to the largest network of agencies and other distribution partners to market and distribute their commercial lines products. The distribution platform automates market appetite communications directly to agency management systems, digitizes submissions for both simple and complex risks, and then sends the submission data to underwriters. This ultimately increases the ease of doing business and creates new business opportunities for both agents and insurers.

While it’s important for insurers to work together with insurtechs to enable this seamless distribution experience, it’s also critical for more insurtechs to take part. Distribution workflows are only as effective as the technology they connect to and enable. The more connectivity partners that sign on to provide access to markets and integrate with management systems and policy admin systems, the more agents and insurers can participate and efficiently distribute the best products for policyholders.

How can brokers use insurtech to their advantage? Are there any key solutions they should be paying attention to?

Jason Liu: Leveraging technology to support remote/digital work will be essential for the foreseeable future. Many buyers of insurance will remain remote or hybrid indefinitely.

Being able to support and sell to these audiences will be critical – and leveraging insurtech is vital for growth.

Solutions that can support the commercial quoting process will be essential for the success of brokers. The commercial submission process is still too manual and time-consuming, and customers are starting to expect quote comparisons faster. Insurtech can help, with a number of solutions being made available to connect agents and carriers directly to facilitate customers’ quotes faster and more efficiently.

Dan Moore: Much like the carrier world, brokers have a host of opportunities to leverage insurtech through technologies like AI and automation, blockchain, and robotic process automation to more efficiently process data, and Internet of Things devices and sensors to improve risk assessments.

Amy Zupon: For brokers, it’s clear that in many ways, the pandemic further validated the key insurtech trends we’ve been investing in for a number of years: robust and efficient agency management solutions, improved connectivity between agents and carriers, advanced analytics to unlock the power of the industry’s vast pools of data, and dynamic digital experiences for the end insured.

At their core, these trends are intrinsically linked to the outcomes most likely to improve an agency’s performance: increased efficiency, higher client satisfaction and the ability to find new business opportunities. And the advantage of these outcomes is clear: Data from our thousands of customers shows agencies that invest in these insurtech categories grow faster and see higher profitability year-over-year in comparison to industry averages.

Brokers can expect innovations in all these areas in 2021 but may want to especially keep an eye on emerging solutions in two areas: the client experience and analytics.

Clients have long expected outstanding service with maximum efficiency, which is at the core of what insurtech helps agents provide. And the events of the past year have only accelerated and deepened consumer expectations of being able to do business when and where they want. We’re also seeing more agencies leverage communications platforms that allow them to deliver relevant,

just-in-time information and content to their clients. These technologies are helping agencies of all sizes take client relationshipbuilding into the digital realm.

When it comes to analytics, insurance has always been a data-driven industry, and the most exciting developments in insurtech almost always revolve around new and better ways to leverage that data to serve customers and manage risk. Over the past few years, insurtech providers have delivered tools that can proactively predict which clients are at the highest risk of leaving, sift through vast pools of data to create coverage recommendations, automate personalized client communications and more. These tools are harnessing some pretty advanced technology to make independent agencies of all sizes faster, smarter and nimbler.

Taylor Rhodes: Agents should be taking advantage of those insurtechs that are designed to work with agents to make their business processes more effective. It’s important to make sure agents are working with a management system that is open and able to quickly integrate with third-party applications. The days of closed systems are coming to an end, and technology must become more open and integrable, creating flexibility for agents to harness its power to support their business as it evolves and changes over time. Software built on componentized architecture with open APIs creates simple ways to integrate the management system with other critical business applications and quickly get information in and out of the system of record.

Indio is an example of an insurtech for agents with commercial lines business that enables more effective and efficient workflows. Instead of having to pull specific applications and supplemental forms from each insurer and then send them over to the customer to fill out, agents can use Indio, which has digitized more than 10,000 insurer forms, to digitally collaborate with customers to fill out a single online form.

Indio uses information stored in the management system to auto-populate the digitized insurer form. The agent can then share the document with the customer

INSURTECH’S PRIMARY AREAS OF DISRUPTION Mobile platforms Selling insurance on smartphone devices Connected home/office Accessing data to understand energy consumption or consumer behavior Connected car Developing usage-based insurance products Sharing economy/ peer-to-peer Covering new risks, developing temporary coverage and providing new assistance services Blockchain Using blockchain-enabled smart contracts to create a more seamless insurance process Connected health Increasing access to healthcare services through advanced cloud technology Source: The Digital Insurer

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INSURTECH 2021 through a portal to fill out the rest of the fields. Once the digitized form is filled out, the structured data is submitted to the insurer through IVANS, and the underwriter can begin the quoting process. This automated commercial lines solution shortens the typical data-gathering and submission time from two weeks to mere minutes, freeing up agents to service customers and delivering a premier digital customer experience.

How is insurtech developing in the claims space? Are there any key developments that have helped reduce claims leakage, limit fraud or otherwise offer assistance?

Taylor Rhodes: A shift in customer experience demands, brought on by large, digitalfirst companies like Amazon and Uber, has driven insurtechs to transform how agents and brokers serve their customers in claims.

Using technologies like machine learning and artificial intelligence, insurtechs have redefined what was possible in placing and tracking claims.

For example, Applied has collaborated with Google to create an artificial intelligencepowered chatbot, allowing policyholders to walk through a series of simple questions to answer. This is simulated to the customer as a chat message with a virtual claims assistant, ensuring that all necessary information and photos are stored within the management system and then sent to begin the claim.

This allows the customer to start a claim at any time of the day, without having to call and wait for their agent to help. Not only does this strengthen the agency/customer relationship, it also saves time by shifting interactions that have been historically facilitated by agency employees to self-service. Because of these efficiency gains, customer self-service often delivers a return on investment in less than one year.

Jason Liu: Traditionally, the claims experience for customers has been risk management, notification of loss, assessing the claim and settling. This process is often confusing

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for customers and costly to the carrier.

Claims handling and settlement is the largest cost for carriers and is often the only time a customer deals directly with their carrier.

Changing customer expectations make this process obsolete, since many customers want 24/7 service, and they want to file claims virtually. Technology is helping with this, and some digital insurers offer claims payments instantly, but this is typically for small routine claims like home and auto.

Complex claims still require a great deal of manual effort.

The use of sensors in your car or home, using drones to assess property damage, and using AI and photo apps to review claims images are just some of the ways technology is improving the claims process. Insurers are also using rule-based claims submission forms and virtual assistants to help claims get filed faster and more accurately.

Amy Zupon: Claims are a key area of concern for carriers, and insurtech advances in this space exemplify how the industry is increasingly leveraging data analytics to both improve efficiencies and uncover areas of opportunity.

HOW INSURTECH CAN BETTER PROTECT CONSUMERS Using advanced technologies such as blockchain-enabled smart contracts, artificial intelligence, autonomous driving technologies and new cybersecurity methods to protect consumer identity and cover new risks Delivering personalized and tailor-made coverage via engagement with IoT, data analysis and mobile innovations Leveraging the expertise and scale of strategic partners to anticipate changing consumer behaviors Providing customers with added services through their smartphone Source: The Digital Insurer

“Using technologies like machine learning and artificial intelligence, insurtechs have redefined what was possible in placing and tracking claims” Taylor Rhodes, Applied Systems Many large carriers have already upgraded their claims management platforms, but we’re seeing a number of insurtechs investing in platforms to meet the needs of mid-sized and small carriers in particular. The goal is process automation, efficiency and using analytics to get claims in the door, triaged – identifying if a claim is high-risk or simple – and routed to the right adjuster as quickly as possible.

The second area of insurtech and digital investment in this space is in fraud detection.

Research shows that especially in commercial insurance, the profit difference between the top and bottom performers can be upwards

of 10 points. Fraud can account for up to 10% of a carrier’s claims cost every year, so better fraud management could potentially close that gap. A number of insurtechs are using predictive modeling and advanced AI to help carriers fight fraud. Analytics can spot anomalies and identify claims that require additional investigation, and integrating data from telematics devices can help quickly corroborate the details of a claim.

Third, we’re seeing analytics and Big Data at work to address claims leakage. Carriers are developing relationships similar to healthcare providers, with pre-negotiated reimburse-

ment for repairs. Analytics are enabling them to better predict the cost of repairs while accounting for variables like geography. That predictability and cost control obviously has benefits for both carriers and the end insured.

All of these advancements reinforce the ways that the industry is increasingly leveraging data and analytics and predictive modeling.

Many believe that insurance has shifted toward an innovation-focused digital culture. In what areas does it still need to improve?

Jason Liu: Insurance has definitely shifted in this direction. Insurance customers pay premiums, file claims, review policies, request changes and more online. But they are still looking to do even more digitally. The entire buyer’s journey needs to be transformed digitally, from lead generation to quoting to servicing and supporting and accounting activities. There’s still a lot of work to be done to modernize the experience.

Dan Moore: It is still early days for insurtech, and there is still room for improvement across the full insurance value chain.

The best results will come from solid partnerships that leverage both tech innovation and insurance industry expertise.

While a lot of focus is on data, AI and technology, we have to remember that insurance helps people in their darkest hour – it is the fulfillment of a promise sold long before the loss occurs. We’ll begin to see insurtech advance supporting the human side of the equation – helping customers make better insurance purchasing decisions, providing greater access for all participants and enabling firms to empathically support customers throughout the life cycle.

Amy Zupon: I think insurance can seem stagnant as an industry, but what people forget is that this is an industry that was built on the collection and leveraging of data. And data is the fuel that powers some of the most exciting new technologies – AI/ML, for example – so insurance, especially on the carrier side, is well positioned for continued innovation, and

“It is still early days for insurtech, and there is still room for improvement across the full insurance value chain” Dan Moore, QBE North America there are huge opportunities to build industrychanging solutions that analyze, manage and mitigate risk like never before.

The litmus test of any new technology is “How does this solution drive value for the customer?” So, while focusing on new AI/ML engines that can better evaluate risk, monitor customer satisfaction, predict customer attrition, and create more personalized insurance products and pricing are all exciting technologies that can provide tremendous value, insurtech also needs to be sure it is focused on the basics of creating efficiencies and improving customer experience.

Taylor Rhodes: While the insurance industry has made significant progress over the last year, there is still work to be done to enhance the customer experience. As I previ-

ously mentioned, companies like Amazon and Uber are setting expectations for how consumers should be serviced, and it is time that insurance accelerates adoption of these technologies as well.

Agents can adopt technologies such as self-service portals and mobile apps to put the power in their customers’ hands. Using digital tools like these enables insurance customers to obtain proof of insurance, access insurance documents, make payments, report first notice of loss and track claims processing without ever having to contact their agent. This provides customers the autonomy and digital experiences that they have become accustomed to with other industries, ultimately enhancing loyalty and the agency’s competitive proposition.

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BUYER’S GUIDE providing exclusive data services that help insurance professionals make smarter business decisions throughout the sales and customer life cycle. We are helping our clients leverage the industry’s leading content, which is essential for keeping their organizations informed of the everchanging marketplace while positioning them as expert business consultants to their clients.

We are building our solutions with an open-architecture philosophy to help create greater connections with key stakeholders throughout the insurance life cycle.

“There is so much opportunity in the insurance industry for the entire buyer’s journey to be truly transformed digitally” ZYWAVE Year founded: 1995 Headquarters: Milwaukee, WI Leadership: Jason Liu, president and CEO

Tell us about Zywave. What do you do?

Jason Liu: Zywave leads the insurance tech industry, fueling business growth for partners with cloud-based sales management, client delivery, content and analytics solutions. More than 15,000 carriers, agencies and brokerages worldwide – including all of the top 100 US insurance brokerages – use Zywave solutions to enhance client services;

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achieve business growth; and promote greater health, wellness, risk management and safety.

What’s your key area of focus in the insurance ecosystem?

JL: Serving both carriers and brokers, Zywave provides the most comprehensive offering of sales, marketing and management solutions to fuel business growth.

How are you using technology to fix pain points in insurance?

JL: We are automating workflows to enable greater efficiencies and produce precise, predictable results. We are

How does your technology benefit agents and brokers?

JL: Ultimately, all of Zywave’s solutions tie back to profitability and growth – from marketing automation and lead generation to the industry’s leading content library to tools for enhanced customer service and retention.

What tech innovations are you most excited about for the future?

JL: There is so much opportunity in the insurance industry for the entire buyer’s journey to be truly transformed digitally.

We are on the cusp of a monumental shift in the way insurance organizations do business, and it’s really exciting to be a part of it.

Tech Solutions that Fuel Growth We help you improve the entire process of how you do business.

Whether it’s finding and engaging with new prospects, quoting new business with carrier-direct rates or continually educating and servicing your clients – we find new ways to grow your business and retain your existing clients.

Find out how at Zywave.com

FEATURES

INSURTECH 2021

QBE NORTH AMERICA Year founded: 1886 Headquarters: New York, NY Leadership: Todd Jones, president and CEO, QBE North America

Tell us about QBE North America.

What do you do?

Todd Jones: QBE North America is a global insurance leader focused on helping customers solve unique risks so they can focus on what matters most. We offer a broad spectrum of specialty, commercial, program, personal and crop insurance capabilities. Customers can rest assured they are getting specialized advice from a true partner, underpinned by risk mitigation, exceptional claims and caring service. Whatever the situation, QBE is with you.

What’s your key area of focus in the insurance ecosystem?

TJ: We offer a broad program set spanning three major markets.

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Alternative Markets is the alternative distribution arm of QBE North America, composed of programs, personal insurance and Westwood Agency.

Our crop division offers outstanding customer service to our agents and farmers and is an industry leader in innovative technology.

Coverages include crop hail, livestock, multi-peril and named peril.

Our specialty and commercial division provides coverages and services to support the specialized needs of a wide range of industries, including manufacturing, real estate, wholesale, financial institutions and aviation.

How are you using technology to fix pain points in insurance?

TJ: Communication will always remain at the heart of claims service excellence, and technology can help us stay ahead of customers’ evolving expectations. Today, many of our customers in North America want to communicate via text/SMS, so we recently added a service, TextQBE, that uses AI to initiate and carry out routine messages with these customers. Our claims team can still jump in at any time for more empathetic and complex discussions. Our customers think it’s great.

We also use technology to engage with customers even before a claim occurs.

For instance, we work closely with our loss control and catastrophe modeling teams to identify customers in the path of a severe storm or wildfire. We can then leverage technology to send a warning to those customers with appropriate safety and claims reporting information.

How does your technology benefit brokers and agents?

TJ: Customers expect quick responses with customized coverages. We look for innovative technology to support those needs and help them to manage their unique risks. The more our innovations can influence that, the happier our partners will be.

What tech innovations are you most excited about for the future?

TJ: One of the most exciting advancements in recent years has been the growth of virtual desktop adjusting, particularly in the property space for first-party claims.

By leveraging specialized smartphone apps, our claims professionals can direct a customer in real time to survey their property and take and upload pictures of damaged areas. This capability forms the basis of their estimate and has been especially useful during COVID-19 and created a situation where portions of our work can be done virtually.

In a real-life example, we recently saw severe storm damage to the exterior of a customer’s building. On the same day the customer reported the claim, we sent instructions on how to self-inspect the damage using a specialized 3D modeling app. Where previously using an independent vendor to conduct an on-site inspection could take up to a week, our customer was able to complete the inspection the very next day in under an hour.

Another example is the migration toward the implementation of a mortgagee address change robotic desktop automation solution in personal lines. The bot receives PDF information from lenders and instantly updates internal systems with this data, dramatically reducing the time to process these requests. This faster resolution for both our customers and agent/broker partners helps reduce the amount of work conducted by our employees.

Technology has unlocked enormous potential, and we’re very excited about the new possibilities for serving customers better – not just in claims, but at every point in their experience with QBE.

Programs

We’ll focus on partnerships, so you can focus on Growing your business takes a strong strategy – and even stronger relationships. That’s why QBE offers distinctive expertise, global strength and a focus on innovative technology, all backed by trusted relationships with our program partners.

Discover QBE programs: • Over $1 billion annual premium • Deep underwriting and claims expertise • Investing in technology for the future • Ability to write multi-line and mono-line coverage in all 50 states • Personal, Commercial (P&C) and Professional lines of coverage Together, we’ll create the alternative risk, management and service solutions you need – so no matter what the future holds, you can be sure that QBE is with you.

Read about some of the innovative work we’re doing or visit us at qbe.com/us

Alternative Markets

Crop

Specialty & Commercial

QBE and the links logo are registered service marks of QBE Insurance Group Limited. ©2021 QBE Holdings, Inc. This literature is descriptive only. Actual coverage is subject to the terms, conditions, limitations and exclusions of the policy as issued.

FEATURES

INSURTECH 2021 How does your technology benefit agents and brokers?

AZ: Insurance is evolving, and independent agencies are feeling the pressure to change from factors like agency consolidation, evolving client and employee expectations, and emerging technologies. For agencies, the key to staying ahead is investing in the approach and tools that truly support growth and client and employee satisfaction. At Vertafore, we’re focused on building solutions that both address the industry’s core needs and that integrate and work well together. That approach ensures our agencies get the most out of their tools because their technology is designed to provide the maximum value and efficiency for their investment.

VERTAFORE Year founded: 1969 Headquarters: Denver, CO Leadership: Amy Zupon, president and CEO

Tell us about Vertafore. What do you do?

Amy Zupon: As North America’s insurtech leader for more than 50 years, Vertafore is modernizing and simplifying insurance distribution so that our customers can focus on what matters most: people. Our solutions provide end-to-end connectivity; improve the client and agent experience; unlock the power of data; and drive efficiency, productivity and profitability for independent agencies, MGAs and carriers.

What’s your key area of focus in the insurance ecosystem?

AZ: Everything we do at Vertafore is about simplifying and automating insurance distribution for all stakeholders.

For agencies, that means delivering technology that leads to better, more

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efficient processes; empowers client engagement and interactions; and facilitates connections to their carrier partners. For carriers and wholesalers, we’re giving them the right tools to be a partner of choice within the independent agency channel so they can get their products out to market.

How are you using technology to fix pain points in insurance?

AZ: Our solutions are solving three critical pain points in insurance distribution. First, we’re creating more efficient connections – between systems, data and stakeholders – so that agencies and insurers can work better together and better serve their end insureds. Second, we’re using technology to automate and simplify processes and workflows to give agents and carriers more time to focus on their clients and growth. Finally, through artificial intelligence and machine learning, we’re helping the distribution channel unlock the power of the industry’s data to uncover new opportunities and efficiencies.

“Everything we do is about simplifying and automating insurance distribution” What tech innovations are you most excited about for the future?

AZ: Some of the most significant innovations right now are in market connectivity, especially for commercial lines. The commercial submissions process has been a longstanding pain point in our industry, and insurtech is on the verge of solving that challenge. The client digital experience is also a space to watch as the insurance distribution channel works to meet modern, real-time consumer expectations.

When it comes to agency management, it is exciting to see more emphasis on openplatform, API-enabled solutions that are enabling agencies to engage with the tools they need to grow without replacing their core systems. Finally, our industry is sitting on a treasure trove of data, and we’re seeing some really remarkable advances that will enable agencies and carriers of all sizes to unlock the power of that data.

FEATURES

INSURTECH 2021 core promise of productivity, intelligence, simplicity and value.

APPLIED SYSTEMS Year founded: 1983 Headquarters: University Park, IL Leadership: Taylor Rhodes, president and CEO

Tell us about Applied Systems. What do you do?

Taylor Rhodes: Applied Systems is a leading global provider of software that powers the business of insurance.

Recognized as a pioneer in insurance automation, Applied is the world’s largest provider of agency and brokerage management systems and a leader in data exchange, seamlessly connecting insured, agency and carrier stakeholders.

What’s your key area of focus in the insurance ecosystem?

TR: Applied enables greater access to information and streamlines workflows, allowing our customers to better connect within their business to their insurer partners and their customers. Applied’s place in the insurance ecosystem lies in equipping and enabling the independent agency channel by delivering integrated automation from the back office to the front office.

We empower agents to break out of the broken processes and poor customer experiences to create simple online interactions – from application to policy binding to servicing and renewals. We expand intelligent connectivity across the insurance ecosystem to help agencies and

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insurers perform better together, all while providing intelligence that helps agents and insurers grow their business more efficiently by turning data into actionable insights.

Our focus and commitment is to invest and push forward to make the digital future of insurance practically helpful for the entire ecosystem and ultimately the end insured.

How are you using technology to fix pain points in insurance?

TR: The insurance industry is historically riddled with paper-driven manual processes, often creating inefficient workflows and poor customer experiences.

These challenges start in the internal operations of the independent agency, including back-office processes such as policy administration, accounting and the management of customer relationships.

When digital technology isn’t used, the inefficiencies extend to an agent’s insurer relationships. Without the use of digital technology, agents must individually contact insurers and rely on fax and mail to complete the policy purchase process. Finally, without a customer portal, all communication with the insured must be in person, over the phone or via email, requiring insureds to contact their agent for everything.

Applied technology enables agencies to reshape their businesses with three core focuses: a foundational system to manage their entire business, omnichannel customer service, and a single network for market access and service – all delivering on the

How does your technology benefit brokers and agents?

TR: Applied technology automates the exchange of information and data throughout the insurance life cycle among agents, brokers, insurers and consumers, delivering a connected experience between all participants in the insurance ecosystem.

This means greater connectivity with insurer partners and insureds. When the business of insurance is digitally connected, all stakeholders benefit from superior experiences, such as operational efficiency and better customer service, across the entire insurance life cycle.

What tech innovations are you most excited about for the future?

TR: I’m really excited to see our portfolio transformation hit prime time as we realize the opportunity to advance the core architecture and underpinnings of our systems. Applied is focused on building technology that allows for greater flexibility and accessibility for customers – and even better, integration across our own product portfolio. We aim to deliver choice and automation with third-party integrations or shared APIs, whether through our partner program or with other providers that want to tap into the system. As a trusted technology provider, we aim to create ease of doing business for our customers, their customers and their partners while achieving the highest level of security.

To continue creating ease of doing business for our customers, Applied is continuing to focus on simplifying the user experience. Today’s employees come to work expecting their productivity tools to meet the same standard of user experience they enjoy in consumer tools like Google, Facebook, Amazon or Apple. We want to deliver that same easy interface that they’re used to so they can more easily train and onboard new employees, create more productivity within their daily workflows, and realize more time for revenue-generating activities.

Your digital path forward looks bright.

Gone are the days of closed systems. The road ahead is built on open technology, creating new and exciting ways to engage your staff and excite your customers.

At Applied, we are committed to delivering open innovation in all that we do.

We are setting new standards for your business to have the choice and flexibility to build your agency, your way.

The choice and flexibility to innovate are yours. Let us show you how we can help.

www.appliedsystems.com/innovationdrive

SPECIAL PROMOTIONAL FEATURE

INSURTECH AN INSURTECH startup based in Columbus, Ohio, Branch wanted to accelerate the process for obtaining quotes on bundled home and auto policies. As it stood, customers had to answer a long list of questions to get the information they wanted.

But by using a mix of modern application programming interface (API) technologies, including ClarionDoor’s CD Rating solution – an insurance product engine that delivers precise premium calculations, rule processing and underwriting decisions in milliseconds – Branch was able to simplify the quote process to just two questions: “What is your name?” and “What is your address?”.

“Branch, along with their technology partners, handles everything else behind the scenes,” explains Michael DeGusta, CEO of ClarionDoor. “Leveraging third-party data sources, they are able to fill in all of the required information, and ClarionDoor processes everything to provide accurate and precision pricing options via CD Rating.”

CD Rating is just one of ClarionDoor’s suite of solutions for rating, quoting and issuance that’s helping fuel new startups and empowering existing companies to modernize legacy products.

Just buy, configure and use

The doors of innovation IBA sat down with Michael DeGusta, CEO of ClarionDoor, to find out how the company’s solutions are helping both insurtechs and traditional carriers harness the power of technology to transform the insurance process 36

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Among other things, ClarionDoor’s solutions address existing issues with outdated insurance systems, which can be difficult to maintain. Many require on-site installation and maintenance, take months or even years to implement, and are difficult to integrate and upgrade. What’s more, they tend to focus on back-office needs, such as billing and claims, and have limited capacity for product innovation or empowering sales and distribution.

“The bottom line is that modern insurers do not want the overhead of managing software or infrastructure,” DeGusta says. “They want – and need – solutions that are buyconfigure-use versus the traditional approach of buy-install-code-configure-use-manage.

Veteran insurers are starting to move in this direction as well, but it is a much slower and tedious transition, as they already have

one door is better than others

providing the most intelligent insurance product distribution software

sales@clariondoor.com Santa Barbara, CA | Philadelphia, PA | Hartford, CT

1 (570) 645-5050

SPECIAL PROMOTIONAL FEATURE

INSURTECH

systems in place. Regardless, we definitely see the industry moving as a whole in this direction and believe that five to 10 years from now, if not sooner, on-premises solutions will be a thing of the past.”

ClarionDoor provides a platform for insurers to rate, quote, bind, issue, manage and track business. It is a 100% cloudnative, API-first, low-code/no-code software as a service (SaaS) that is hosted exclusively on the highly scalable and dependable Amazon Web Services (AWS) platform, removing the burden of software management and maintenance on the client. There’s nothing to install, no infrastructure to manage, no software upgrades – and it’s also simple to use.

The company’s competitors include rating engines such as CGI Ratabase and Oracle Insurance Insbridge, policy life cycle management solutions such as BriteCore and Duck Creek, and low-code/no-code platforms such as Unqork and Appian.

“While our competitors claim to be cloud-enabled, we designed and built our software from the ground up specifically for the cloud and exclusively for AWS,” DeGusta says. “Every aspect of our software is first designed and built with an API, enabling our customers to integrate more seamlessly and automate processes. Through our breakthrough API technology, we are able to provide a true no-code solution that is 100% configurable by our customers. The result is faster speed to market (weeks), lower cost, operational efficiency and no customermanaged software maintenance.”

Empowering invention In addition to CD Rating, the ClarionDoor suite of solutions features five other systems.

CD Quoting Portal provides an intuitive, cloud-native, API-first user interface for processing quote and policy life cycle transactions across any line of business. CD Forms Service is an API-first web service for automating the activation of forms based on quote and policy data. CD Issuance offers an API-first web service for generating policy

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documents and converting bound quotes to policies. CD Tracker is a real-time analytics application for tracing core performance metrics – such as premium, total insured value and number of quotes – against userdefined dimension buckets based on region, underwriter or agent, or any other policy attribute. Finally, CD MGA Hub offers an intuitive interface for MGAs to quote and compare rates with multiple E&S carriers in real time.

The possibilities for innovation are myriad. Like Branch, Flow Insurance is an insurtech startup that has leveraged these technologies to roll out a differentiated product. Flow is an MGA that provides flood protection for commercial and residential

for diverse P&C risks, wanted to upgrade its business workflow for commercial general liability and commercial property. CD MGA Hub empowered Breckenridge to connect with more than 25 E&S carriers to deliver more competitive pricing options for those markets.

And Amwins, a leading global distributor of specialty insurance products and services, is using ClarionDoor technology to boost its underwriting capabilities.

“We have been leveraging ClarionDoor products and services for the last several years within our small business platform, Amwins Access, and couldn’t be more pleased with our results,” says Ben Sloop, chief operating officer at Amwins. “We see them as a

“We have been leveraging ClarionDoor products and services for the last several years within our small business platform, Amwins Access, and couldn’t be more pleased with our results” Ben Sloop, Amwins locations; with the help of ClarionDoor technology, the company was able to deliver a comparative pricing experience.

“The rise of insurtechs [such as Branch and Flow] is really pushing the market in a new direction,” DeGusta says. “These newcomers are really tech-savvy and understand that in order to provide a modern solution, you need to leverage the best software available.

They have realized that there is not one solution that can do it all, which is a major shift from the monolithic approach that veteran insurers have used forever. There has also been more attention on cloud-native, APIarchitected software and a significant transition from the traditional on-premises approach to cloud-native applications.”

Meanwhile, Breckenridge Insurance Services, a wholesale MGA offering coverage

critical partner as we expand these capabilities into specialty programs and build out a world-class underwriting infrastructure for our carriers and capital partners.”

Including these four trailblazers, ClarionDoor has 75 customers across the Western world and has implemented more than 40 P&C lines of business. Clients can go live in weeks instead of months, and they’ve had zero project failures.

DeGusta says ClarionDoor plans to build on these successes going forward. “We are committed to investing in what we do best: building great insurance software technology, solving the challenges of insurance product distribution, providing an unparalleled customer experience and delivering on our promise of liberating our customers to focus on innovation, not implementation.”