Insurance, defined by Wikipedia as the equitable transfer of the risk of a loss, from one entity to another in exchange for money, has a long history. Chinese and Babylonian traders practiced forms of insurance as far back as the third and second millennia BC, respectively, but insurance as we know it really dates back to the Great Fire on London in 1666. Despite that long history though, it’s also an industry ripe for disruption, with technology playing an increasingly important role across the industry.
Health-tracking, smart data analysis, and app-based rewards are all part of the contemporary insurance space. But as JSE-listed insurance giant MMI-Holdings knows, innovation isn’t just about technology.
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The company, which has a market cap of more than R50-billion, understands that to be truly innovative, corporates have to think like startups and move quickly.
As MMI’s head of disruptive innovation strategy Jaco Oosthuizen told Ventureburn in a recent interview, “the biggest challenges that creep into large corporates are inertia, legacy systems and processes, bureaucracy, low tolerance for risk”.
Oosthuizen’s unit is designed to counteract that, by giving people of an entrepreneurial bent the freedom to operate in a fast and agile, lean way while creating the bridge to the mothership to give them scale and resources on an arm’s length basis as and when required.
Oosthuizen acknowledges that fostering internal disruption and innovation isn’t always easy in the corporate space.
“You need ambidextrous leaders that can think outside the human species’ cognitive biases and make bold decisions,” he says. “People tend to fall back into their comfort zones as soon as they face difficult decisions”.
“Disruption is not a comfort zone,” he adds. “It needs guts and not everyone has it. It obviously comes with higher risk than the status quo and hence very few large corporates has the appetite for this level of risk taking and rather take the ‘safe route’, which in the end will be the route to obsolescence”.
But it’s also about timing. As Oosthuizen notes, “a number of new technologies and business models are still in fermentation stage and you do not know which horse to back”.
But, he says, the pace at which technology is changing means that companies can’t afford to take a “wait and see” approach when it comes to innovation and disruption.
“You either need to disrupt, or be disrupted,” he says.
As further evidence of its support for innovation, MMI has thrown its weight behind the Startupbootcamp Insurance Accelerator Programme.
The accelerator programme is open to startups from all over the world, with the only caveat being that they focus on different areas within insurance, including consumer, re-insurance, back-office efficiency and new risk models.
The insurance programme comprises Fast Track days, an Insurance Hackathon and an Insurance Lounge. Fast Track days are sessions that take place over a six-month period where ten startups in various venues across 12 countries are given five minutes to pitch their insurance related business idea to a panel of judges.
At the 48-hour Insurance Hackathon, the insurance industry will challenge talent to come up with innovative and practical solutions to some of the questions they face as sector. The Insurance Lounge will provide later-stage startups an opportunity to engage with executives and present their innovation idea to the Startupbootcamp investors.
The ten successful startups sourced from the 12 countries will then go into a three-month accelerator programme where they will be provided with resources necessary to birth their startup idea.
“We believe that technology can play a major role in revolutionising the insurance industry and we want to be part of this revolution,” Oosthuizen told Ventureburn.
For that reason, he says, MMI decided to become investors in the programme and not only sponsors. “This means that we will have a small equity stake in each of the start-up companies (around 30 over three years),” he says.
From there, MMI will selectively decide whether to increase this stake as it sees how the potential of these companies evolve.
“This is just the first of many potential opportunities that we identified to enable MMI’s vision to make people, businesses and communities financially well,” Oosthuizen says.
Launched in 2015, Startupbootcamp Insurance is the leading Insurance accelerator, and the only program of its kind to attract such wide industry support. Based in London, its partners include: Admiral, Allianz, ERGO, Lloyds Banking Group, Metropolitan, MMI Holdings, Momentum, PWC, Route 66 Ventures, Unipol Ideas, as well as an extensive mentor and alumni network from more than 30 countries across the globe. The award-winning accelerator offers Insurance startups access to world class industry expertise during an intensive three month program. At the end of the program, startups pitch at Demo Day to more than 250 investors.
Startups selected for the accelerator get access to a number of benefits, including:
- Extensive mentorship from 400+ entrepreneurs, investors, and partners
- Access to top markets in London, Europe, Asia-Pacific
- 3+ months free office space
- €15K in cash per team
- €450K+ in partner services
- Exposure to 200+ Angels & VCs
- Invitation to SBC global alumni network
More information on the Startupbootcamp Insurance London Accelerator programme can be found on the website.
