InsurTech definitions: what is RegTech?
An increasingly important aspect of InsurTech, RegTech is a closely-related aspect of the sector which underpins its day to day operations.
RegTech, as with many companies in the ‘-Tech’ sphere, has its origins following the 2008 financial crisis, which was the catalyst for a significant reevaluation of financial services, insurance companies and the technology and processes which held them together.
As its name implies, it is primarily concerned with managing regulations, conducting industry research and ensuring compliance with rules.
The companies themselves are differentiated from their pre-digital forerunners by their usage of cutting-edge tech solutions, such as cloud computing, data analytics, AI (artificial intelligence) and more.
The widespread integration of digital technology into so many basic areas of modern life has led to a parallel increase in illicit online activities. These include, but are not limited to, money laundering, fraudulent insurance claims and data hacks.
With high profile breaches like those at Capital One and Wirecard making headlines globally, the need for both businesses and their customers to feel protected has never been more vital; at a time when ‘data is the new oil’, sufficient safeguards must be put in place.
Collaborating with financial service providers, institutions and organisations using easy but secure data-sharing platforms like cloud, RegTech firms can easily liaise with companies and work out effective ways of preventing or eliminating threats.
Although the volumes of Big Data generated by the finance sector were previously too monolithic to wield effectively, modern data analytics powered by AI and ML (machine learning) algorithms can quickly assess information which would have been unfeasible for human workers.
Top three UK RegTech companies
: Using an analytics platform which can automatically record and collate data, the company has made significant strides since it was founded in 2010: raising $5.5mn in a Series A funding round in 2015, tripling revenues by 2017 and doubling in size by 2018.
: ClauseMatch specialises in automating process-driven tasks, collating data and facilitating collaboration. In addition to recently in the US, the company was also listed as a finalist in TechRound100’s .
: ComplyAdvantage is an award-winning organisation intent of using data to change the way companies operate. Currently serving 500 customers in 75 countries across three continents, it is able to streamline data review processes from months to minutes.