Recently, we held a live InsurTech chat with Minh Q. Tran on Twitter. Here is the transcript:

Question 1 (Minh Q. Tran): What are the current trends in insurance regarding customer experience?

Answer (Rudolf Falat): In the podcast with Generali, we talked about the increased use of technology by insurers, with the underlying goal of improving customer experience and being a partner to the customer, helping with their insurance needs.

One example could be the use of AI for risk assessment, predictive underwriting techniques and telematics to offer usage-based insurance model. Another focus is on platforms and ecosystems where insurers can participate as a protection provider or risk mitigator.

Question 2 (MQT): Why would large, incumbent insurers cooperate with start-ups at all?

Answer (RF): Start-ups are much bolder and much faster. However, an incumbent can benefit from working with them, and start-ups can benefit from working with an incumbent. Open innovation is the right way to do innovation nowadays.

For example, in my podcast with AXA, we talked about their cooperation with Veezoo, a data science start-up. Veezoo helps AXA to analyze and visualize sales data. AXA is rolling out Veezoo’s tool to the agents who love the program, thanks to which they have a better view of their sales and client interactions.

Question 3(MQT): How can this cooperation be successful? What are the prerequisites?

Engadin, Switzerland. Courtesy of Delia Ying Xing

Answer (RF): For incumbents, it’s crucial that when start-ups approach them, they know what they’re doing. In other words, they have the first product in the market and already have the first clients.

Then, incumbents are happy to see how it might fit into its business and how it might solve a problem that their clients have. The team fit is essential: start-ups have to be able to work with corporates, which is not easy sometimes!

Question 4(MQT): Why just investing money by the VCs is not enough?

Answer (RF): We talked about with you and a few other VC investors on the podcast. Also, this is a common thesis among sophisticated early-stage investors.

As the allocations of pension funds and other institutional investors to VC and PE have relaxed over the years, VC’s dry powder has exploded. Let’s see what happens now with the coronavirus impact…

In general, though, the money has become a commodity, and high-quality start-ups choose whose money to accept also based on the ability of the VC to add value as an advisor, coach, sounding board, a backup executive and most commonly, someone who can open the doors.

Question 5(MQT): What does it mean, asset builder?

Answer (RF): Well, in the podcast, you explain that Odysseus looks for start-ups with reasonable strong growth, not hyper-growth. Odysseus intends to help these businesses to build their markets. It’s like investing in Uber, on the one hand, and the other hand, buying a taxi company to bring customers to Uber.

Likewise, it’s like investing in Airbnb, on the one hand, and the other hand, investing in a real estate company to buy apartments that will use Airbnb to find customers. That’s the Odysseus model. Did I get that right?

Question 6(MQT): How close or how far do start-up ideas have to be for Generali to make sense to partner with them?

Answer (RF): Based on our podcast talk, Generali seems to take a fairly broad approach to deal with start-ups. If there is some nexus to their business, that works, which is excellent because the ecosystem approach or open innovation would hardly work!

Question 7(MQT): Examples of start-ups that cooperate with Generali?

Answer (RF): Billte digitizes and automates the entire invoicing process built with Generali together to simplify the invoice process for Generali customers.

Imburse provides hassle-free integration into the global payments ecosystem. Shift crypto security offers a hardware wallet for private keys.

24 credit is a P2P loan platform that connects borrowers with investors with insurance in case the borrower dies and the debt doesn’t pass onto heir.

Klara.ch is a digital assistant for SMEs, managing payments and bookkeeping.

Question 8(MQT): Are the insurers active in the outreach within the start-up ecosystem?

Answer (RF): In the podcasts with Generali, we talk about how Generali participates in ActionJam in Bern, Swiss FinTech Ladies, regular InsurTech meetup at F10 and many other events, for example discussing new technologies impacting customer behaviors, etc. Also, AXA and AXANauten are very active in the Swiss start-up ecosystem, no doubt!

Question 9(MQT): Customer focus and chatbots? Really?

Answer (RF): Insurers want to be partners with the customers. At the same time, everyone is trying to automate low value add, repetitive tasks — like answering similar customer queries all over again. This is where chatbots come in.

Often, people find interacting with them very frustrating. Enterprise Bot is one start-up that participated in Generali Garage and has been profitable since Day 1? How? Natural language processing — NLP.

Question 10(MQT): How does NLP make a chatbot better?

Answer (RF): In my podcast interview with Enterprise Bot, who took part in then Generali Innovation Garage and won many start-up awards, the co-founders explained that they had to use NLP in any case. Based in Switzerland, their bot has to work in multiple languages and therefore has to learn on its own.

Enterprise Bot leveraged this technology, unlike other bots that cannot learn on their own; they are programmed as basic trees that you have been facing in the call centers.

Question 11(MQT): How does it improve customer experience when dealing with an insurer?

Answer (RF): I would say when customers generally reach out to their insurer, it’s not a happy occasion. However, the insurers are under pressure to cut costs, so they have been outsourcing call centers, sometimes struggling with training their staff and managing stressed-out customers.

Enter bots — if not done smartly, they can only backfire. So if we have an opportunity to make bots smarter, i.e., set them up, they learn themselves, go for it! This will pay off when you are balancing the cost of customer care and customer satisfaction.

Find out more about Minh Q. Tran and Odysseus Partners here.