Growth, growth and more growth
2020 saw $4.1bn invested in UK fintech, the second largest investment market in the world. And the UK insurtech market is “one of the most diverse and active on the planet” (KPMG), with over $1bn in investments last year. Change is clearly afoot, but what are the opportunities for players in this space? Especially, given the reputation insurance has for being risk-averse, and with consumers driven by price.
What do you get a CEO that has (almost) everything?
“Insurers always have built their success on data, digital transformation and associated changes in customer expectations have heightened data’s value” PWC, CEO Survey, Insurance Trends 2019.
The PWC report points out that 97% of insurance CEOs think data is important for understanding customer preferences, but only 10% feel the data they receive is adequate. This is a huge disparity, and clearly a feature the insurtech industry has been built on. But payments platforms need to take note too.
The answer is already here
As with most things, the answer has been staring us in the face for a while. Contis added Virtual Card functionality to its platform some years ago, and certainly before I joined the business. If you don’t know, V-cards are mobile, disposable, digital versions of your debit card. They can be configured to your needs (either single or multi-use), merchant restricted, and can be connected to your Apple/Google/Samsung Pay to allow mobile payments.
Sending instant insurance disbursements to a customer’s account in case of emergency, coupled with the ability to make instant mobile payments sounds like a useful mechanism, right? One that might even retain the notoriously price-driven insurance customer in a competitive market.
And here’s the kicker… data!
Rather than money being sent by BACS (yawn!) into an anonymous bank account, the insurer can now track the payment, put restrictions on spend where necessary and reduce risk. Risk monitoring overheads would be driven down, customer loyalty would be increased and insight into spending would be provided to the insurer allowing for more personalised customer service and sales opportunities in the future.
Contis has seen a huge increase in demand for these types of services in the insurance market over the last year or two, but we’re only scratching the surface of the enormous opportunity. The likelihood is that the global insurtech market will be worth over $10bn by 2025, with virtual cards forming the tip of the spear of innovation into this next phase of growth.
Head of Marketing, Contis