18 July 2017 07:00
Michel Bergeron | Photo : Réjean Meloche
For Michel Bergeron, a partner at EY, assurtechs are the businesses that succeed because they focus on clients and on the service. And not on the products, as do the insurers.
Mr. Bergeron made the remarks at the most recent Congress of the insurance and investment organized by the Journal of insurance. And he added that this success is corroborated by the importance that these companies hold in the world of fintechs. In the United States, the assurtechs represent 11 % of all the fintechs. This rate increases in England, where it amounted to 15 %.
«The primary mission of the assurtechs is to solve a specific problem which the customers face. They do not want to take over the distribution network to the full. They address to a rather specific problem and want to resolve it effectively. The assurtechs succeed because they are focused on the customers, while the insurance industry is focused on products, » he explained. They rely on the simplicity, the innovation, and offer products which are attractive to customers.
This is notably the case of LearnVest, a fintech american which brings together in a portal that is accessible at any time all assets of the client, in order to give him the control of his personal finances. The algorithms of LearnVest offer personalized advice according to the data of the different accounts that the customer has entered, and its financial goals. In addition, a financial planner is available by email to answer the questions of the users.
Disruptive or enabling ?
If the assurtechs were seen as disruptive to the industry, these companies are turning more and more towards the service companies. Indeed, 68 % are facilitators for the different actors of the insurance industry, compared to 32 per cent, » says Mr. Bergeron, is based on research carried out by EY.
«The assurtechs have understood that they can help insurers instead of opposing it. They are willing to help customers, but also help businesses, » added Mr. Bergeron. This change of direction on their part is an opportunity for insurers to partner with these assurtechs, to help in the distribution.
This proportion of assurtechs facilitators must lead the advisors do not see them as enemies. «Some see the advent of assurtechs as a struggle between the representatives and the robots-advisers. The industry may very well move forward by focusing on a model that combines the human and technology, and a balance between the two is possible, » says Mr. Bergeron.
However, it mentions that the assurtechs face a daunting challenge : they don’t have access to as easy as the insurers to the customers. «Insurers already have a relationship of trust and confidence established with the client. The assurtechs, although they have the means to build with the Internet, do not have this relationship with the customers and with the distribution networks. «Furthermore, the regulatory framework poses a further challenge, while the representatives are already accustomed to navigating through it.
Adapt or not to adapt ?
In an environment where the ascent of the assurtechs is imminent, Mr. Bergeron warns companies who do not want to adapt to the changes. «Blockbuster is one of the companies who did not want to adapt, when a company called Netflix has knocked at their door to partner with them. The questions that enterprises need to think about are “how will I adapt ?” and “what decisions will I take to do it ?” «It goes on to quote Charles Darwin, who said that the species that survive are not the strongest or the most intelligent, but those who adapt the best.
«The universe of assurtechs is very broad, and key distribution to the client, as well as the possibility of increasing the operational efficiency of brokers, by providing efficient tools using, for example, the analytical data «, concluded Mr. Bergeron.