Embedded Insurance

• The insurance purchase is separate from the purchase of the product or service associated with the underlying risk and is ineffective and inefficient. This decoupled purchase of insurance creates problems such as protection gaps, poor product mapping, and eventually a bad customer experience.

Also, these offline purchases of insurance products increase the distribution cost of insurance products. The higher distribution cost creates misaligned and poor products.

The reason for this decoupled insurance purchase is insurance products are complex. Both on the demand side and the supply side.

On the demand side, every consumer has a different need, purchase power, and understanding of the product.

On the supply side, building such personalized and granular products is challenging due to the lack of technology and data for underwriting.

Distribution cost increases the cost of acquiring every customer. Hence partnering with the platforms which have already gained the trust of the consumer and where customers are doing their online, digital transactions could be a good strategy to reach out and sell the insurance services.

Embedding the insurance in the digital service can help consumers to assess the underlying risk correctly and make a wise decision when the risk is more contextual and present at the moment of buying.

To embed the insurance products into other platforms where consumers have high trust like Apple, Airbnb, Uber, or any vertical SaaS company, insurance companies need to externalize their insurance services.

Due to the legacy infrastructure of the insurance businesses it is highly complex for them to build such flexible, modular, and contextual services which can be externalized.

At MetMorphoSys we are trying to solve this problem by building the modular, contextual and atomic APIs which can be embedded inside any platform which would like to cross-sell and upsell the insurance products of the insurers.

Also, the APIs enable to securely capture the data from the platforms to underwrite the products better. This platform’s data helps insurance companies to design products for more personalized and contextual needs.

The insurance ecosystem.is moving towards integrating multiple stakeholders using the API platforms.

Image courtesy: Angela Strange’s presentation from a16z

The value proposition it offers to insurance companies

1. they can access the large pool of customers that they are currently not able to capture at a marginal cost of acquisition.
2. The insurer can provide excellent customer service in terms of buying experience because it is not a decoupled purchase. Users are buying when they need the most.
3. APIs of the insurer can now act as the distribution platform

APIs of the insurer can now act as the distribution platform

For the platforms, the benefits are

1. Cross-sell and upsell the products and earn adjacent revenues.
2. Valid product matching reinforces the trust within a platform from the consumers.

For end-users the benefits are

1. Access to personalized risk assessment
2. Access to affordable financial products.
3. Satisfying the customer journey in buying insurance products.

Our vision of the future is that any company can be an insurance company and we are on the mission to provide the right tools for them to enable them.