InsureTech Connect 2019

AXA Next
AXA Next
Nov 6 · 7 min read

AXA Next US recently attended InsureTech Connect, the world’s largest insurance technology conference. The event took place in Las Vegas and brought together over 7,000 attendees from 60+ countries for the biggest and most comprehensive gathering of technology entrepreneurs, insurance industry incumbents, and investors from across the world. In stark contrast to the first ITC we attended back in 2015 that explored the development of new technologies that would disrupt the market (e.g. AI, IoT, data, cyber, robotics, etc.), the latest one centered around the maturing of these technologies and its impact on the industry. The 3-day experience provided a comprehensive look into the digital transformation taking place within the global insurance ecosystem and offered powerful insights into the topics driving discussions among incumbents, insurtechs, and investors alike.

The Future is Digital

Artificial intelligence is a burgeoning technology that holds great promise for the industry as everything in our world becomes increasingly digital. A keynote presentation shared by Kara Swisher, renowned tech business journalist and co-founder of Recode, shared her perspective on what our future looks like in a digital world, as well as a deep dive into key tech trends that are impacting and driving change in the global insurance industry.

Artificial Intelligence

“Anything that can be digitized, will be digitized”

Perhaps the hottest topic of conversation at ITC was Artificial Intelligence — over recent years, we’ve witnessed its impact in every sector from insurance, to healthcare, cybersecurity, entertainment, media, and everything in between — but this is just the beginning. Swisher stressed the importance of every company thinking about its impact (e.g. massive job disruption) as part of their business strategy, daily practices, and the broader future. “Anything that can be digitized, will be digitizedif you’re not thinking about this very simple sentence, you’re going to be digitized out of existence,” she warned.

To further validate her point, she shared an example from an interview she held with former Uber CEO, Travis Kalanick, where he was asked what the problem of his business model is. According to Kalanick, “The problem is the guy in the front seat — if we can get rid of him, my business is fantastic.” In addition to showing an appalling lack of humanity, this also showed a clear vision for what’s to come for the future of jobs, said Swisher. In this vision, Artificial Intelligence is leveraged to drive cars — this would subsequently impact insurance dramatically, but its impact will likely only be felt in the longer term. However, for those thinking that AI is far off are sorely mistaken. AI pops up in the most inconspicuous places and is already helping with risk and claim assessment. For example, AXA XL Innovate portfolio company, Cape Analytics, leverages AI to analyze detailed maps for risk assessment.

Robotics & Automation

The robots are not killers (they don’t have to kill to win)”

Swisher believes that robotics and automation will replace all repetitive jobs in the future (e.g. mining, manufacturing, transportation, etc.). Similar to the coffee and burger shops served by robots in San Francisco, robots will have very specific capabilities that do everything from cook food, do the laundry, wash dishes, etc. While the technology for this is already available today, the reason it is not deployed more widely is because human labor is cheaper than robots — but eventually, it won’t be. While experts believe all “repetitive” jobs will be replaced in the future, human creativity is still something that cannot be replicated (yet) — this means that jobs that require creativity will stick around, while parts of jobs that don’t (e.g. functions of lawyers and doctors that can be replaced by computers and automation) will be replaced, according to Swisher. And while left unsaid, the same can be argued for insurance. At its heart, insurance is (should) be a very human job. It touches people at important moments in their lives where they can feel lost or emotional, such as in the event of a car accident or illness diagnosis. Insurance is too often process driven. By leveraging robotics and automation to ease processes, insurance operators can focus on what truly matters for their customers: being the human support during moments that matter.

Transportation Explosion: Autonomous and Urban Mobility

“Cars are the horses of tomorrow and scooters the magic carpets of today”

25 years ago, Swisher made the bold prediction that people would no longer have home phones, and would rely mostly on their mobile device — she was right about that! Today, Swisher makes the bold prediction that car ownership is going to end — while cars will still be around, they won’t be how we envisioned them. According to Swisher, most people will live in mega cities, and the urban mobility revolution will result in other modes of transportation (e.g. scooters) taking over. In regards to the current state of autonomous cars, she believes its tech is better than what media suggests. All the data points towards autonomous vehicles being safer for people than cars. Despite many safety, regulatory, and insurance obstacles that need to be overcome, she believes the future is autonomous, and it will be similar to how it was when cars replaced horses in the past.

AXA is actively helping to enable this future in a safe and responsible way. For instance, chief actuary at AXA UK, David Williams, is collaborating with research organizations, automotive companies, and the UK Government to create the right regulatory framework for autonomous cars.

Uncertainty and Disruption

A variety of other trends were mentioned by Swisher, including endless choice (the proliferation of the on-demand economy that changes consumer buying habits and expectations), the ongoing privacy debate, continuous partial hacking (constant state of being hacked), continuous partial attention (cellphones!), political and social unrest, overvaluations in the private markets, regulation, and climate change. What is the commonality here? Uncertainty, unrest, instability. The world is throwing information and change at people at an accelerating pace. Insurance is in an interesting position to be both as a lifeline and a cornerstone. Through its asset investment policy, the insurance industry can influence economic decisions (e.g. divestment from coal). But likewise, insurance can enable new technologies. For instance, AXA XL Innovate portfolio company, New Energy Risk, provides additional risk coverage to enable industrial companies to secure debt for investment in new and cleaner technologies. Through AXA Climate, the AXA Group also provides affordable parametric policies to those most vulnerable to climate related risk. In addition, a portfolio company of AXA Venture Partners, Security Scorecard, provides risk scores and peace of mind to business owners about their cyber exposure. In this fast-changing world, insurance, enabled by new data and technology, can be a real partner to its customers.

Incumbents and InsurTechs: The Power of Collaboration

The pace of innovation is accelerating as incumbents and startups alike step up to address pain points associated with the industry, manage risks better, and decrease costs. Head of AXA Next US, Bastiaan de Goei, joined a panel of experts to speak about the journey of innovation at AXA Next, and the strategy behind their “Buy, Build, Invest, and Partner approach.” He made an important distinction between AXA’s significant investments in making insurance better, faster, and more efficient (through AI, automation, and robotics) versus important investments in changing the relationship that customers have with their insurer—this is summarized in AXA’s ambition to move “from payer to partner.”

De Goei went on to explain that, today, insurance companies compensate for financial loss. This is an important job and can be further enhanced with technology. But the same risk insight and expertise can also be used to help customers mitigate risk exposure. A good example is in health — it is good to get financial compensation for a procedure; but it is great to not need a procedure in the first place by helping customers lead better, healthier lives. AXA Next, AXA’s innovation company, leverages its different funds to develop new propositions such as this. From enabling great entrepreneurs through AXA Next’s incubator Kamet and its VC fund AVP, to acquiring great companies such as US based Maestro Health, and establishing valuable partnerships such as the one recently forged with Uber it can only be done together.

What’s on the Horizon

From connecting with talented entrepreneurs, to collaborating with other AXA entities on our ITC sponsorship initiatives, to speaking on panels and gaining deep insight into the forces shaping the industry, the team had a busy and inspiring few days! Overall, it was an exuberant experience that left us with powerful insights and a renewed sense of enthusiasm for what’s to come for the future of insurance. In terms of what’s on the horizon, it’s clear the pace of change will continue to accelerate as the technologies and innovations revolutionizing the industry come to life. We feel ready to participate and contribute to this exciting new chapter for insurance!

AXA Next

Written by

AXA Next

AXA’s innovation ecosystem in Silicon Valley, Shanghai and Europe. #InsurTech #FinTech https://group.axa.com/en/page/disclaimer-twitter

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