Why insurtech could save the property sector
In recent years, we’ve been inundated with stories about insurtech, proptech, fintech, healthtech — the list of sectors being disrupted by technology is endless. And whilst these monikers are helpful for intra-sector analysis, they minimise something crucial: the cross-sector impact such innovations can bring. And the role insurtech is playing in the evolution of the property market is a prime example of this in action.
Like many sectors, the property sphere is being rapidly reshaped thanks to digital disruption — or ‘proptech’. Challengers brands, such as PurpleBricks and Zoopla, alongside impactful legislation including the Tenant Fee Ban, have ushered in a period of recalibration for the property sector. In these choppy waters of change, just as we’ve seen across insurance, tech is playing a seismic role in reshaping the market. But there aren’t just similarities between these two spheres of sector disruption; we are also seeing fundamental change occurring at the intersection of insurance and property. And it’s here where some of the most impactful advancements are happening.
The role of insurance in all things property has long been established. Contents and buildings insurance for homeowners are standard, and landlords would be remiss to not adequately insure homes they are renting out. Insurtech disruptors and challenger brands have been looking to capitalise on these traditional market segments for some recent years. But the role of insurtech is now revolutionising how the property market accesses a wider pool of products, something which is changing the relationship between such businesses and their customers.
We are operating in a world where customer experience is king. Consumers are looking for seamless service with added-value thrown in as standard. As a result, property market players, who for too long offered silo-ed services, are moving towards a layered, more integrated offering. And the commercial opportunities that this is bringing to estate agents and landlords is proving crucial at time of industry flux.
As Generation Rent morphs into a legion of lifetime renters, the value-add of offering additional products that are easily accessed and seamlessly integrated into the rental process is clear. From contents insurance and deposit replacement for tenants, to building in rent protection for landlords, there’s a huge space where the role of insurance is gaining importance in the world of property. This is enabling insurers to take a more granular view on different areas of the sector and deliver new products at more competitive rates.
And it’s technology which is enabling this. For the letting agent, insurtech offerings are providing a route to protect their income. At the same time, landlords and tenants are benefitting from relevant insurance products delivered in a modern, integrated way. It’s a perfect example of two spheres of disruption — insurtech and proptech — colliding to add value to the end user.
The beauty of such technology is that it allows small businesses to play on a level playing field with industry behemoths. This equilibrium ensures that more companies than ever can access innovation and pass the benefits along to their customers. This disruption is not only displacing traditional ways of doing business, but also dissolving the boundaries between industries.
As we ruminate on the future of modern economies, we would do well to take a pan-sector view of the impact of innovation. For those working on the front-line of any industry, whether it be insurance, property, health, or finance, you will have seen up close the rapidity with which technology is shifting how we deliver services. But we must also be attuned to the impact technological disruption is having on adjacent industries, lest we risk missing out on the opportunities cross-sector pollination can bring.
Oliver Sherlock is Head of Insurance at Goodlord.
