Independent insurance technology firms are challenging long-time monopolies and business practices, embracing the online views of younger generations to get the products and services they want faster and often, cheaper, said speakers at the innovation summit of the Travel Health Insurance Association of Canada (THIA). 

Consumers today are more digitally savvy than ever before and independent insurance technology firms need to be prepared for consumer behaviour shifts, said Erin Bury, co-founder and CEO at Willful, a company that helps Canadians create their estate plans online. 

Many companies closed during the height of the COVID-19 pandemic, some of which were not innovative enough to meet consumer demands.

Changing consumer behaviour 

“If you think consumer behaviour isn’t going to change – it is – but how can we try to understand what consumers value and start to be ahead of the trends...and be open to them instead of being late to the party?” Bury said.

She noted that even large firms close for failure to innovate, especially when it comes to engaging clients who want to move to mobile-only experiences. 

Today’s consumers care about instant gratification – everything from food to liquor to cannabis – depend on circles of influence for what and how they buy products and value experiences.

Bury said remote work has enabled more travel and allowed people to work from almost anywhere, embracing flexibility and the “digital nomad life” and companies have to follow suit if they want this demographic.

Bury set out to digitize wills five years ago along with partner Kevin Oulds. Together the pair secured a deal with Dragons’ Den star Michele Romanow, even though neither one is an estate lawyer.

“I think that’s our secret weapon,” she said. “If you left it up to estate lawyers to build something like this they never would…because they think the way they do it is the way it always will be. So, it often takes people from outside a legacy industry to come in and look at it from the eyes of the consumer and what they want to actually be able to do is make a change.” 

Bury said Willful targets people with simple situations and sees her company as a complement to the legal industry. She said they’ve seen push back because some see this as threatening the livelihoods of current lawyers. “Our fundamental belief is no consumer in 20 years is going to want to make an appointment in a lawyer’s office when they can come to us [online]. It’s just not the way we’re going to do it.” 

Earlier this year, the Financial Services Regulatory Authority of Ontario (FSRA) released details of its Innovation Framework to foster advancements in the industry while protecting the public interest. 

Daniel Zhan, senior Policy and Technical Lead on Innovation at FSRA, said the regulator wants to use its principals-based rules to work collaboratively with insurtech innovators to achieve an outcome that is good for both the company and consumers. 

“We want to find the best approach in a collaborative fashion,” said Zhan. “We are allowing, in a controlled manner certain practices that are otherwise not permitted to be tested in the established parameters and to be creative.” 

Test and learn approach 

This “test and learn” approach is guided by principles that protect consumers and markets from unreasonable risk and harm, directly benefit the public, are adaptable to each sector FSRA regulates and that the testing environment be collaborative and transparent. 

A number of insurtech companies have started up to meet the demands of innovative firms, including BOXX Insurance Inc., a firm that executes best practices when it comes to cyber risk management and cyber claims. 

Neal Jardine, Global Cyber Risk Intelligence & Claims Director with BOXX told those attending the innovation summit that since COVID-19, hackers have been even busier targeting more people, especially those who work from home.

Jardine said attacks that used to take months to execute, now take place within only a matter of hours. 

A hack causes disruption, loss of money, an increase in attacks and premiums, but Jardine noted that despite all this aggravation, his firm stays engaged with his clients.