Sep 15, 2020

Lemonade selects France as its next expansion location

Lemonade
France
Insurtech
Insurance
William Girling
2 min
Lemonade's expansion into France marks the latest development in its meteoric rise during 2020
Insurtech innovator Lemonade has announced that France will be the location of its latest expansion into the European market...

Insurtech innovator Lemonade has announced that France will be the location of its latest expansion into the European market.

The company’s renowned brand of insurance driven by AI (artificial intelligence) and behavioural economics is scheduled to be available before the end of 2020 - French customers can join a waiting list in the interim. 

“Home insurance is often legally required in France, which automatically makes it a compelling opportunity for Lemonade’s next European country launch,” commented Daniel Schreiber, Lemonade CEO and Co-Founder. 

“While the French insurance market is one of the most developed globally we believe that Lemonade’s unique mix of value, values, and technology will stand out to the French consumer, offering the ability to get fast, personalised, and mission-driven insurance, from the comfort of any phone.”

This latest development marks the third example of Lemonade’s growth on the continent, with the Netherlands confirmed in April 2020 and Germany in June 2019.

An insurtech success story

Taking the number three position in our recent ‘Top 10 insurtech unicorns’ list, Lemonade’s progress in 2020 indicates that it is one of insurtech’s most notable success stories so far and a company well-placed to meet the needs of the post-COVID-19 market.

In addition to its market growth, Lemonade has also launched pet insurance for cats and dogs, launched a successful IPO (which was regarded as being one of 2020’s strongest offerings), and managed to raise over US$1m for 34 non-profits as part of its unique Give Back programme.

The latter is, perhaps, one of the best examples of what separates the company from its contemporaries; not satisfied with offering customers a simplified, customisable and yet technologically advanced platform for insurance, Lemonade believes in its obligation to support the communities it serves.

“The global pandemic has hurt so many in so many ways. More than ever, we’re grateful that our business allows us to take care of our customers while they take care of their communities,” Schreiber added.

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Jun 19, 2021

Insurtechs are winning the race with legacy system companies

Insurtech
Insurance
AI
Technology
Tom Allen, Founder, The AI Jou...
3 min
Insurance has long been due an overhaul. The AI Journal’s founder Tom Allen explains how innovative insurtechs are changing the incumbent narative

Nestled in its own place within the world of financial services, insurance is arguably more unpopular than retail banking.

That’s hardly surprising given that, from a customer service perspective, insurance is something of an off-kilter transaction. You pay a sizable premium in exchange for a service you hope you will never have to use. This image problem is exacerbated by ubiquitous tales of insurers not paying out when it is time to make a claim.

The insurance sector has long been due to an overhaul, and this is where the disruptive force of insurtech comes in - one of fintech’s most upwardly mobile subcategories. Accordingly, last year, insurtech in the UK alone attracted £262m in investment, a growth of 60% on 2019, according to Tech Nation. Insurtech’s momentous growth has been captured in a new report by The AI Journal exploring this burgeoning sector. 

What exactly is insurtech?

Put simply, insurtech refers to technological innovations that seek to make insurance cheaper to buy and more efficient to use. In a similar vein to fintech, the large, established institutions have been dipping their toes into insurtech, but it’s the disruptors who are genuinely looking to shake up the status quo, diving into and exploiting those areas that traditionalists have little imperative to explore.

Examples are price comparison sites (one of the earliest forms of insurtech that was eventually snapped up by the insurers it initially sought to disrupt), claims software, customisable policies, or even smart-tech-enabled dynamic policies whose premiums can fluctuate depending on changing circumstances.

The latter, for instance, could use someone’s fitness tracker or smartwatch to monitor fitness levels, thus reducing the premium of a life insurance policy; or track a GPS system that records the location of a car and assesses risk levels accordingly.

Most consumers tend to shop around for their insurance needs and perhaps end up buying their contents insurance with one provider, their car insurance with someone else, and their pet insurance with yet another underwriter. Managing all these different policies, with their varying renewal dates and payment terms can be complex. This has led to the increase in apps that pull everything together.

More prosaically, insurtechs are developing AI that uses machine learning to act as an insurance broker, eliminating the need for a human intermediary and therefore offering more cost-effective and impartial advice.

Insurtechs and risk

But there are some obstacles in the way of insurtech’s continued evolution.

Insurance companies are averse to risk. Understandably so, as at the crux of the industry is the role of the actuary, whose job it is to analyse and measure the probability and risk of future events. So it’s little wonder that there’s a reluctance among the traditional players to welcome the disruption that insurtech brings.

Insurance is heavily regulated, a minefield of legality and labyrinthine jurisdiction, which means the idea of shaking it up can be anathema. And why would they, when their old-school business models are working perfectly fine?

There’s an understandable nervousness and unwillingness to work with startups, who themselves need to work with the bigger firms in order to underwrite risk.

While it seems like a catch-22 situation, there is growing, if cautious, interest from insurance companies, who can see the benefits of insurance with a friendlier face, innovative solutions, and a competitive edge through differentiation. As that tentativeness dissipates, the growth of insurtech will gather even more momentum.

Tom Allen's analysis is based on the findings of a new report on the fintech and insurtech industries produced by The AI Journal

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