All Aboard the Digital Train

Insurtech providers are facilitating a more efficient insurance market for both buyers and sellers. Brokers must stay ahead of the learning curve to remain competitive.
By: | September 12, 2017 • 4 min read

Insurtech firms — many with the financial backing of big name insurance groups — are fast making cheap, digital P&C procurement the norm.


By and large though, they don’t see themselves as disruptors. They prefer to be perceived as revolutionaries — transformers of the market.

Commercial brokers targeting the SME sector would do well to pay attention, and to commit to staying up to date with the rapid pace of changes to come.

“Existing brokerages aren’t built to serve the needs of smaller or medium-sized businesses. The big guys can’t service them efficiently, and the smaller brokerages don’t have the resources, market access or vertical expertise,” said Matt Miller, CEO of start-up Embroker, launched two-and-a-half years ago.

“Carriers are thinking hard about how to develop digital strategies without alienating and disrupting their existing distribution networks,” said Sofya Pogreb, COO of Next Insurance, which serves 6,000 small businesses through its platform with the backing of powerful investor-partner Munich Re.

“Companies like ours do pose a threat for the traditional distribution channels,” she said. “Insurtech will either replace the agent or provide them with better tools so they can focus on offering expertise to customers rather than moving paper applications around — I suspect a mix of both.”

Sofya Pogreb, COO, Next Insurance

Small local brokers for whom SMEs are their bread and butter may be particularly concerned, though Keith Moore, CEO of Coverhound, is keen to work in partnership.

“Rather than disrupting, we think we’re enabling market segments that have been underserved. We’re also giving small local brokers a better way to transact. We want to help facilitate the transaction, and are indifferent as to how the business is placed,” he explained.

“Anyone who said the traditional broker is dead is a fool,” said Insureon CEO Ted Devine. “However, agents and brokers are going to have to embrace some of the technologies we are leveraging to make their solutions more efficient and deliver more value for the customer.”

Many of those new technologoes will soon be essential for brokers to grow and sustain their business.

“We bid on 400,000 keywords every day and have massive models to make sure the return on every bid is right, and we’re doing some cool things with machine learning to deliver the best product to the customer.

“This is very hard for a broker to do, so they’re going to have to raise their game to be at our level,” said Devine, adding: “The best ones will.”

Forging Ahead

While Insureon, Embroker and Coverhound all pride themselves on providing human expertise to help buyers find the right solutions, their real competitive advantage will always be driven by their tech capabilities. Some, like Next, are happy to limit human interaction to a minimum.

“On certain larger or more complex risks, perhaps an engine can’t make all the decisions and human expertise is needed — at least in the near term,” said Pogreb, though others feel insurtech may have a role to play higher up the food chain fairly soon.

Miller believes Embroker’s model is “just as relevant” to large, complex commercial risks, though he admits that it will be a challenge overcoming “entrenched” buyer behavior, while Devine thinks big commercial risks could benefit from automated panels.

“Agents and brokers are going to have to embrace some of the technologies we are leveraging to make their solutions more efficient and deliver more value for the customer.” — Ted Devine, CEO, Insureon

“I’ve been surprised how much appetite there is for an alternative way of transacting among larger commercial accounts,” said Miller. “It shouldn’t cost so much to access insurance in a digital world, and companies are increasingly looking at their efficiency ratios.”

Matt Miller, CEO, Embroker

He believes the implications of the swathes of data captured through insurtech will be “profound” for the insurance industry, helping improve underwriting efficiency and risk modelling.

Next is planning to move beyond pure distribution into the development of proprietary products tied to the distribution engine and react to data in real time — essentially creating intelligent, ongoing optimization of coverage. “That’s not happening in the traditional market at all.”

This is one area where brokers could wrestle back some advantage by taking the lead in the development of wearables, telematics and other data sources to bolster risk modelling and real-time insurance cover.

Doug Turk, chief marketing officer at JLT Group, acknowledged that insurtech is a risk for brokers, who he said should already be investing in research and development and tech partnerships.


“The broker of the future will have to be incredibly information literate. They’ll have to understand all the different sources of information available about their clients’ operations and risks.

“They’ll have to be willing to separate themselves from the way things have been done in the past and accept that there may be better ways to do things, particularly when it comes to how risk is underwritten and rated,” he said.

Alternatively, some agents and brokers might choose to explore the other side. “We’re certainly hiring,” said Embroker’s Miller. &

Antony Ireland is a London-based financial journalist. He can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

Risk Management

The Profession: Curt Gross

This director of risk management sees cyber, IP and reputation risks as evolving threats, but more formal education may make emerging risk professionals better prepared.
By: | June 1, 2018 • 4 min read

R&I: What was your first job?

My first non-professional job was working at Burger King in high school. I learned some valuable life lessons there.

R&I: How did you come to work in risk management?

After taking some accounting classes in high school, I originally thought I wanted to be an accountant. After working on a few Widgets Inc. projects in college, I figured out that wasn’t what I really wanted to do. Risk management found me. The rest is history. Looking back, I am pleased with how things worked out.

R&I: What is the risk management community doing right?


I think we do a nice job on post graduate education. I think the ARM and CPCU designations give credibility to the profession. Plus, formal college risk management degrees are becoming more popular these days. I know The University of Akron just launched a new risk management bachelor’s program in the fall of 2017 within the business school.

R&I: What could the risk management community be doing a better job of?

I think we could do a better job with streamlining certificates of insurance or, better yet, evaluating if they are even necessary. It just seems to me that there is a significant amount of time and expense around generating certificates. There has to be a more efficient way.

R&I: What was the best location and year for the RIMS conference and why?

Selfishly, I prefer a destination with a direct flight when possible. RIMS does a nice job of selecting various locations throughout the country. It is a big job to successfully pull off a conference of that size.

Curt Gross, Director of Risk Management, Parker Hannifin Corp.

R&I: What’s been the biggest change in the risk management and insurance industry since you’ve been in it?

Definitely the change in nontraditional property & casualty exposures such as intellectual property and reputational risk. Those exposures existed way back when but in different ways. As computer networks become more and more connected and news travels at a more rapid pace, it just amplifies these types of exposures. Sometimes we have to think like the perpetrator, which can be difficult to do.

R&I: What emerging commercial risk most concerns you?

I hate to sound cliché — it’s quite the buzz these days — but I would have to say cyber. It’s such a complex risk involving nontraditional players and motives. Definitely a challenging exposure to get your arms around. Unfortunately, I don’t think we’ll really know the true exposure until there is more claim development.

R&I: What insurance carrier do you have the highest opinion of?


Our captive insurance company. I’ve been fortunate to work for several companies with a captive, each one with a different operating objective. I view a captive as an essential tool for a successful risk management program.

R&I: Who is your mentor and why?

I can’t point to just one. I have and continue to be lucky to work for really good managers throughout my career. Each one has taken the time and interest to develop me as a professional. I certainly haven’t arrived yet and welcome feedback to continue to try to be the best I can be every day.

R&I: What have you accomplished that you are proudest of?

I would like to think I have and continue to bring meaningful value to my company. However, I would have to say my family is my proudest accomplishment.

R&I: What is your favorite book or movie?

Favorite movie is definitely “Good Will Hunting.”

R&I: What’s the best restaurant you’ve ever eaten at?

Tough question to narrow down. If my wife ran a restaurant, it would be hers. We try to have dinner as a family as much as possible. If I had to pick one restaurant though, I would say Fire Food & Drink in Cleveland, Ohio. Chef Katz is a culinary genius.

R&I: What is the most unusual/interesting place you have ever visited?

The Grand Canyon. It is just so vast. A close second is Stonehenge.

R&I: What is the riskiest activity you ever engaged in?


A few, actually. Up until a few years ago, I owned a sport bike (motorcycle). Of course, I wore the proper gear, took a safety course and read a motorcycle safety book. Also, I have taken a few laps in a NASCAR [race car] around Daytona International Speedway at 180 mph. Most recently, trying to ride my daughter’s skateboard.

R&I: If the world has a modern hero, who is it and why?

The Dalai Lama. A world full of compassion, tolerance and patience and free of discrimination, racism and violence, while perhaps idealistic, sounds like a wonderful place to me.

R&I: What about this work do you find the most fulfilling or rewarding?

I really enjoy the company I work for and my role, because I get the opportunity to work with various functions. For example, while mostly finance, I get to interact with legal, human resources, employee health and safety, to name a few.

R&I: What do your friends and family think you do?

I asked my son. He said, “Risk management and insurance.” (He’s had the benefit of bring-your-kid-to-work day.)

Katie Dwyer is an associate editor at Risk & Insurance®. She can be reached at [email protected]