November is Women in InsurTech month at Oxbow Partners.
We are taking a detour from the normal Bitesize format to talk about diversity in InsurTech. This week we spoke with Sabine VanderLinden, CEO of Startupbootcamp (SBC) and Rainmaking InsurTech, about women in insurance. We also took the opportunity to gather Sabine’s views on the emerging InsurTech trends as we head towards the new year.
Women in InsurTech
In 2016, only 16% of SBC InsurTech applicants had a female CEO, founder or co-founder. Sabine believes that this will only change if there is direct, positive action. At SBC, Sabine is trying to take practical steps to make a difference. For example:
- Measuring: “If you can’t measure it, you can’t improve it.” Sabine has discovered through measurement that around 40% of InsurTech staff are women but, like most companies, they are predominately in the more junior roles with fewer reaching senior management levels.
- Announcing: They are sharing statistics about the gender gap to provide transparency and build awareness across InsurTech.
- Educating: For example, in conjunction with the launch of the US Hartford InsurTech Hub, Startupbootcamp is contributing to a student curriculum in the city of Hartford. Through this it is encouraging women to consider insurance as their next career.
Although times have changed (Sabine worked at Lloyd’s when women were forbidden from wearing trouser suits), US research in 2017 finds that women entrepreneurs are asked different questions by VCs than males and as a result of this tend to get less funding (women receive 2% of venture funding despite owning 38% of the businesses in the US).
It’s not all bad news. Sabine is increasingly seeing insurance leaders focusing on diversity: “Senior management are increasingly talking about diversity. Amongst notable recent examples I’ve seen are Paul Jardine (XL Catlin), Amanda Blanc (AXA), Inga Beale (Lloyd’s), the CII, and the ABI.”
Sabine also noted that working in InsurTech may have some distinct advantages for women. For example, technology startups can be more flexible employers, where alternative work hours and career breaks are common.
Sabine interacts with many InsurTechs — from the “glimmer in the eye”, to well-funded mature startups. She is currently going through this year’s SBC applications, and sees the following trends:
- AI is still hot: The big question for startups is what problems their algorithms will solve.
- So is IoT: There are new applications for sensors, particularly those designed towards recent regulatory changes (e.g., the use of motor data).
- More commercial lines offerings, particularly in risk prevention: The trend towards commercial lines solutions leveraging industrial IoT capabilities continues. These businesses are helping insurers proactively assess risk and prevent claims. However, Sabine notes that risk prevention may lead to reduction in premiums. If so where will future top line growth come from?
- New propositions will combine a series of emerging technologies: In the last few years startups have typically focused on one technology (e.g. AI or IoT). Sabine is seeing startups begin to combine complementary technologies into broader propositions for example using data + AI + IoT to deliver practical insights in real-time.
The Oxbow Partners view
(Re)insurers are under increasing pressure to innovate. That threat is coming from all angles, including the continued soft market and from outsiders (cf. Amazon looking to recruit insurance professionals). Evidence shows that diverse teams make for more successful businesses. For example, a 2012 study showed an 80% improvement in business performance when diversity and inclusion levels were high. It therefore seems intuitive that reducing the gender gap in InsurTech can only help to drive innovation and create more valuable businesses. There is a clearly a long way to go and the market needs people like Sabine to bring diversity to the forefront.
As for our views on InsurTech trends going into 2018, you will have to wait until our December newsletter when we will be reviewing our 2017 forecasts and making predictions for 2018.