6 Steps to Building an InsurTech Ecosystem

It involves audacious individuals, partnerships and Germany’s 4th largest city

As told by Jeremy Tai Abbett, Design Partner at InsurTech.vc

As an American expat living in Germany, one thing that I’ve observed over the years is that the German culture is about mitigating risk and not having to worry about “what if?” situations. In other words, over here everything has its place and there’s a place for everything (yes, you need to be Platzreife 🏌 ️to golf over here and you need to get a Fischereischein 🎣 to fish).

I am aware that the digitalisation affects all of us. This is of particular relevance for the insurance industry, which is currently being steamrollered by a digitalisation wave.

Mayor of Cologne, Henriette Reker at InsurHack in Cologne

Germany is not alone in its aspiration to achieving peace of mind — the insurance market globally is enormous, exceeding 5% of US GDP. It’s with this in mind, as well as knowing that the industry at large have archaic business processes, that make the insurance industry ripe for disruption. In Germany, the lion’s share of the insurance industry lives and works in the 2000 year old city of Cologne; Germany’s 4th largest city with just over a million residents.

A Place for Everything. Everything in Its Place.

Cologne is Germany’s insurance capital with over 70 companies and branches (including global companies) in residence making it the “go-to” city when it comes to insurance. Logically, it makes sense to leverage the insurance industry that is part of Cologne’s heritage. That said, based on our personal experience working in collaboration with the industry, we also know how challenging the insurance industry can be when it comes to change.

Since we at InsurTech.vc have our roots in Cologne, we asked ourselves: why should Cologne be Germany’s leading insurtech ecosystem? Who is brave enough to lead this challenge with us? What can Cologne do to be better prepared for the coming imminent digital transformation?

The other half of the equation is Cologne’s willingness to invest in an innovation budget with one main goal being that of job creation for those that are currently working in the insurance industry. Like the publishing industry that has seen its better days, the insurance industry will also go through a huge transformation. For Cologne (not just the city but the chamber of commerce and industry 🏛, investors 💶, insurers 🌂, universities 🎓, startups 🚀…and all stakeholders), this means committing resources that will be future focused on value creation and jobs within the growing insurtech movement.

To better understand the potential of an insurtech ecosystem for Cologne we at InsurTech.vc, along with the City of Cologne, engaged the innovation consultancy Rainmaking with the goal of investigating Cologne’s potential for becoming an InsurTech ecosystem attracting new start-ups, capital and growth. We are convinced that Cologne can be a global player within insurtech pending the ability to get all the stakeholders aligned and focused on the big picture.

View the full version of the study here.

We believe the future belongs to those with a bias towards action and the relationships to make things happen. That said, below are 6 steps taken from the study to insuring a more future ready Cologne:

1. Establish an InsurTech co-working space in the centre of Cologne to ensure a centre of gravity where insurtech start-ups, investors, established players and other stakeholders in the ecosystem can meet.
2. Run multiple events like hackathons, meet ups, etc. to facilitate people and stakeholders in the ecosystem getting together, sharing ideas and information and finding ways to collaborate.
3. Set up a website providing an overview of Cologne’s InsurTech ecosystem to coordinate and engage the ecosystem as well as promote Cologne as an insurtech ecosystem at a national and international level.
4. Identify and establish a pool of relevant InsurTech mentors including successful entrepreneurs, subject experts and industry professionals to support new start-ups with their experience and network and host a quarterly mentor event at the insurtech co-working- and event space.
5. Engage established insurance corporates through an Applied Tech Lab with a dedicated program for exploring partnerships between national and international growth-stage start-ups and insurance corporates.
6. Increase political support to create a thriving business environment for the insurtech scene through visible support, resources and help to navigate the regulatory landscape.

Are you ready to lead the charge? Is Cologne ready? Is the insurance industry ready? We are 💯 🙌🏼!

We would like to thank Sabine VanderLinden & Elizabeth Lumley for guiding us, Helen and Jakob at Rainmaking and Cologne for the joint collaboration in making the study a reality.

by Jeremy Tai Abbett, Design Partner at InsurTech.vc

German Post here