Getsurance is a German InsurTech firm with a digital platform to sell life insurance products.
Getsurance’s differentiators are twofold. First, it has a slick customer quote & buy process; customers can buy policies in under five minutes. Second, it has a simple underwriting model that does not require complex health underwriting; it assesses the risk based on the reported severity of an applicant’s previous health issues.
The company currently offers disability insurance (with other products on the way). The D2C front end takes customers through a short question set to calculate to a provisional price. A subsequent seven-question health questionnaire confirms it. The company is excited about the opportunity to sell to the 75% of Germans who, it says, do not currently have private disability insurance.
The Berlin-based company does not partner with other intermediaries and only deals direct, promoting its website via paid marketing channels. The company has received funding of €2.5m from investors including RGAx (part of US life reinsurer RGA), Investitionsbank Berlin, Picus Capital and Swiss Postbank.
The paper is provided by Squarelife, a Liechtenstein-based insurer, whilst reinsurance capacity is provided by RGA.
The company presently only operates in Germany but plans to expand into multiple additional markets in Europe. It has 10 FTEs.
THE OXBOW PARTNERS VIEW
In a sector not known for smooth customer journey’s, the reported 5-minute underwriting process is reason enough to take note. But, if the underwriting approach proves successful and underserved customer groups can be addressed profitably, it could make a much bigger impact on the market. As we have highlighted in other papers, the question will be whether this impact is best made as a distributor or as a supplier digitising existing models (see below).
Life vs. non-life
We have been spending a lot of time looking at InsurTech in Life, Pensions and Investments recently and it is true that the space is less developed than non-life. On the Distribution InsurTech side and with regard to protection products, we speculate that this is because lead generation and sales conversion is even harder than it is for non-life: how often does the average person think “right, this afternoon it’s time to buy a disability insurance policy for the first time.”
By contrast, it’s interesting to note that Distribution InsurTechs have been quite successful on the asset management / retirement savings front. In the UK, companies like Scalable Capital and Nutmeghave grown quickly with their low-cost robo-advisory models. Whilst managing your retirement savings may not be an appealing weekend activity for many, it is more palatable than planning for one’s death or disability.
Getsurance will need to work out how it will generate sufficient volumes online in a slow-moving market. Investment by RGAx, one of the savvier corporate investors, might be a signal that they have found the ‘secret sauce’, or it merely means that a life reinsurer is hoping that direct will emerge as a hedge against a challenged business model, and is getting in early.
Overall, we think that InsurTech has a role to play in life insurance distribution, but the unanswered question for us is whether the successful players will be those going direct (like Getsurance, but notably also Beagle Street in the UK – a subsidiary of the leading aggregator, CompareTheMarket) or those digitising the existing model (like UnderwriteMe, who we covered last week).