If you have any doubts at all that insurtech is The New Thing, The Next Big Thing, The Already Big Thing, and The Ultimate Bomb-Diggity, look no further than this post from Finextra, pubished just this past May: “Report questions value of insurtech despite record investment“. In its effusive enthusiasm for insurtech, it says this, in part:
The latest Quarterly Insurtech Briefing from insurance broker Willis Towers Watson showed that the highest number of transactions yet (85 with a total value of $1.42bn) were made by insurtech investors in the first three months of the year … an 11% reduction in total value compared to the previous quarter … there is still a lack of clear value from many of these nascent insurtech offerings.
Oh. Wait a minute. That’s not the one I was thinking of.
Smile When You Say That, Partner
Just eight days later, Insurance Thought Leadership published this glowing estimation of insurtech’s prospects for the future: “The Problem With Insurtech Conferences“. That effervescent endorsement of insurtech and its ever-growing number of gatherings said this:
I just wonder if the organizers or participants in these events simply don’t want any naysayers to rain on their parade … [with] the misguided premise that what consumers want and need is fast, easy and cheap … It’s a combination of ignorance and the perception, fueled by our own industry advertising, that insurance is a commodity differentiated only by price … they cater to the base instincts of people because of ignorance or avarice … the U.S. has a great need for rebuilding infrastructure. If we let the equivalent of insurtechs do it, they’d be rebuilding bridges with matchsticks.
Dang! That’s not it, either. Hang on. I got it now.
There Isn’t Room in This Town for All of Us
Yeah. Here we go. After the InsureTech Connect meeting in Las Vegas last month, which drew more than 600 insurance-company CEOs and more than 7,000 of their closest friends for intimate, meaningful conversations, this piece was published on LinkedIn: “Has a ‘New’ Theme Emerged at InsureTech Connect 2019?“
That piece contained this glowing encomium for insurtech:
It was quite exciting. And there are many fascinating companies and ideas that are truly transforming our industry. But then King Solomon’s words (from the Bible) come to mind – “There is nothing new under the Sun.”
And it concluded with this near-clairvoyant observation:
This industry is likely to look quite different a decade from now.
One can only imagine the thunderous applause that would have ensued had that line been delivered in a speech from the floor at InsureTech Connect.
When’s the last time you read or heard any hype about service-oriented architecture (SOA)? How about robotic process automation (RPA)? Okay. Do I hear digital transformation? Can I get an opening bid on application service provider (ASP)? What about a couple of old chestnuts like best-of-breed (a favorite of equestrians everywhere) and end-to-end (if insurers bank on renewals and customer retention, does anyone ever wonder what the hell would happen if the vaunted policy lifecycle actually had an end?).
News flash, kids. Insurtech is just another buzzword in the long history of ephemeral, terminological jargon. It’ll flash in the pan and be gone like all the rest.
As a person who shall remain unnamed from a company that shall remained unnamed said to me at a recent insurtech event that shall remain unnamed, “Eighty percent of these insurtech startups will be gone in five years or less. We’re hanging around for the 20 percent that survive.”
That’s a lot of bodies on Boot Hill.
If you’re going to bet heavy on any of the so-called insurtechs, you might want to wait until all the shootouts thin the herd a bit.
After that, as Mr. Dooley was wont to say, “Trust everyone … but cut the cards.”