The Digital Insurance Agenda was in full display in Barcelona this week at the DIA conference. The theme was accelerating the digital transformation of insurance and there were presentations from over 50 insurtech start-ups. Most of the start-ups, however, were from Europe and America. I fully expect that to change in the coming years and in this post, I want to outline two significant opportunities available for Asian insurtech start-ups.

Mobile First

The smartphone explosion in Asia will create incredible opportunities to unlock value. Smartphone penetration is still below 50% in the large markets of China, India and Indonesia.  For a large number of Asian consumers, the mobile internet will be the only kind of internet they interact with.  Creating mobile-first insurance experiences is clearly the growth opportunity for Asian insurtech startups. The opportunity exists in both distribution and product innovation. For inspiration, entrepreneurs can look to Trov (active in Australia) and Cover (active in the US). Both provide insurance cover based on just a photo.  Seamless, friction-less experiences, in both selecting cover and making a claim, will be the winners tomorrow.

Mainstreaming Micro-insurance

Micro-insurance has traditionally been thought of as a product for the poor with low premiums and low coverage. Typically, micro-insurance policies have not been marketed to middle class consumers as their cost structure does not permit for broker commissions. Another concern is the cost of administering and processing micro-payments.

These two issues have created the strange situation where middle and lower middle class consumers are priced out of the insurance industry in emerging markets. For example, in India, those below the poverty line can get health insurance coverage of US$ 1,000 by paying a premium of only US$5.5. However, the cheapest products for customers above the poverty line start at a premium of US$55 – a 10x increase (with a corresponding 4X increase in cover).  Unsurprisingly, many households chose to forego insurance.  Start-ups that can combine efficient digital distribution with lean payment processing will create a multi-billion dollar market by mainstreaming micro-insurance.

Supporting the eco-system

Insurance is a heavily regulated industry and insider knowledge is a pre-requisite for success.  This makes it hard for entrepreneurs from outside the industry to enhance the capabilities of the industry. The entire stock of innovation is thus lower and significant value remains un-created.  A co-creation platform, bringing together innovators and industry experts is clearly needed. is trying to fill this gap. The platform will focus on supporting entrepreneurs with the knowledge, infrastructure and connections needed to build valuable insurtech businesses.  On the one hand, it will help entrepreneurs navigate regulatory complexity and manage relations with large insurers. On the other, it will allow insurance executives early access to the most interesting start-ups.  I look forward to supporting this initiative.

Disclaimer: This is a personal post. The opinions expressed here are the author’s own and do not represent the views of his employer.

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