Tag Archives: ben-hutta

A Word With Shefi: Micro Insurance

This is part of a series of interviews by Shefi Ben Hutta with insurance practitioners who bring an interesting perspective to their work and to the industry as a whole. Here, she speaks with David Dror at Micro Insurance Academy.

To see more of the “A Word With Shefi” series, visit her thought leader profile. To subscribe to her free newsletter, Insurance Entertainment, click here.

Describe what you do in 50 words or less:

I lead a team that brings the poor in rural informal contexts into the fold of insurance. We address this challenge by acting as change agents. We do not sell a product; instead, we take communities from having no risk-management solution to adopting a mutual-aid insurance model that enables them to establish both the demand for and supply of insurance, specific to their context.

And when you are not working, what do you like to do?

I like to read, write, walk, socialize and rest.

How did you become engaged in microinsurance?

I have been involved with social insurance since the 1970s, mostly at the macro level; in India, I work with grassroots communities. My experience in India teaches me one overriding lesson, that top-down interventions, without full funding, offer very little opportunity to affect social change, and “localism” that taps into invisible resources offers some unexplored opportunities to reach results.

What is the main challenge the Micro Insurance Academy sets out to address?

The social challenge we address is the uninsured exposure to risks that condemns the poor in the “informal sector” to poverty, ill health and uncertainty. Insurance is broadly recognized as an indispensable tool to improve access to healthcare, agricultural production (thus food security and livelihoods) and to mitigate climate-change-related crises. However, the challenge to roll out solutions in the informal sector has proved difficult largely because the multifaceted aspects of poverty are often anchored in families and extended families, and not the individual as in the formal sector. Dealing with those social units requires innovation in business models and social engagements. This is what MIA focuses on.

In a recent paper termed The Demand for (Micro) Health Insurance in the Informal Sector, you write about the importance of group consensus in driving individuals’ buy-in to microinsurance. Do you see insurers account for this lifestyle in their selling proposition?

Our solution, which is to assist the community to establish its own insurance schemes that leverage existing relationships of trust and obligation, is based on developing associations for the purpose of efficient sharing that enable the community to be consumers, creators, collaborators, suppliers and distributors of insurance. This is P2P “sharing economy.” Success means that each member becomes both co-owner and customer, with a role in business decisions of the supply chain, organization and development. Traditional selling is simply not effective in this setting, and mobilizing entire communities, not merely community leaders, is the novel paradigm.

What does success look like five years from now for Micro Insurance Academy?

Many insurers work with us to adopt risk-management solutions to be demand-driven and needs-based. Success in business results would mean outreach to millions of uninsured people, and success in business process adaptation would mean that we mobilize resource pools from resources that are today invisible and inaccessible.

Is the talent gap within insurance an issue in India as it is in North America?

Our model relies on a three-pronged approach (capacity building, governance and insurance), each of which leverages local function, purpose and culture. Developing capacity is a challenge mainly because such capacity must be available at the community level, not just in a few remote back offices. Better local capacity is the backbone that supports good governance.

Best life lesson:

“The greatness of humanity is not in being human but in being humane” – Mahatma Gandhi.

A Word With Shefi: At Telematic

This is part of a series of interviews by Shefi Ben Hutta with insurance practitioners who bring an interesting perspective to their work and to the industry as a whole. Here, she speaks with Marti Ryan and Tom Yates at Telematic.

To see more of the “A Word With Shefi” series, visit her thought leader profile. To subscribe to her free newsletter, Insurance Entertainment, click here.

Describe Telematic in 50 words or less:

Telematic is a SaaS platform that creates personalized pricing models based on driving behavior, mobile phone usage and lifestyle behaviors. It offers insurance companies a way to more accurately price risk, yet more importantly it’s a new marketing channel for a more personalized insurance experience.

Why Telematic?

[Marti] Because usage-based insurance (UBI) makes sense; it’s where insurance is moving; and it’s a good problem for us to solve as a team. Tom was working for a top carrier and saw how difficult it was to execute a dongle-based telematics program and realized that mobile would most likely replace the dongle/hardware solution, so he went home and built it for a year.

[Tom] Marti has over 10 years of market research experience making cities sticky for the next generation. Together, we can make insurance sticky.

Describe your typical client:

We are in the B2B space targeting small to mid-sized, forward-thinking carriers that are looking to explore UBI and are willing to do something different and stand out.

Biggest challenge:

Convincing insurance companies that telematics is a play toward a one-to-one relationship with their customers, rather than an extra tool to price risk. The space is crowded with several companies focused on actuarial, B2C and fleets, but then again that’s an indication of the role this technology has in the currently evolving insurance value chain. Our solution brings in a different approach to the space, one that creates a new marketing channel using 17 years of combined insurance experience to leverage mobile in an engaging way for the next generation.

Who has been supportive of your cause?

Co-Manager at Wisconsin Investment Partners Bob Wood has been a champion, Brian Worden CEO of TeamSoft, Liz Eversol from SOLOMO Technology, Tera Johnson of the UW-Extension Small Business Development Center programming in Madison and, of course, our families.

Why did you decide to take part in the Global Insurance Accelerator?

[Marti] The timing of our start-up lent itself well to an accelerator program that took place in the spring. I’m new to the accelerator scene but understand the huge value it can offer when the right circumstances align to the right program. We had applied to a Madison-based program, and in doing so we broadened our application to the Midwest market. GIA proved to be the perfect fit for us given its insurance focus and our goals; we’ve made connections and built relationships within the GIA network that will help us get Telematic to where it needs to be.

If not for Telematic, what would you be doing?

[Marti] Most likely doing three to four other things; working with the B-Corp group to help B-Corps tell their story via B The Change Media and continuing to provide business planing and consulting for the food industry, including a non-profit, kitchen incubator (FEED Kitchens) and a local restaurant kitchen buildout to allow scaling a meal preparation and delivery business using organic, local and gluten-free ingredients.

[Tom] Working as a software engineer for another SaaS startup.

Best life lesson:

Never give up and keep asking the right questions to the right people.

What are you most excited about with respect to Telematic?

The opportunities that are in front of us are outstanding. We’re certain we’ve got a shot at being a partner for our target market, and, because we’re in the GIA, we’re well positioned to support Midwest-based carriers.

A Word With Shefi: Ashili at Smart Drivinc

This is part of a series of interviews by Shefi Ben Hutta with insurance practitioners who bring an interesting perspective to their work and to the industry as a whole. Here, she speaks with Shashaanka Ashili, founder of Smart Drivinc.

To see more of the “A Word With Shefi” series, visit her thought leader profile. To subscribe to her free newsletter, Insurance Entertainment, click here.

Describe Smart Drivinc in 50 words or less:

We are focused on developing crash-prevention technologies in affordable ways. Our solution for distracted driving is affordable, configurable, tamper-resistant and backed by intelligent evolutionary algorithms.

How did the idea develop?

In 2014, my wife’s car was rear-ended by a distracted driver. A non-fatal, four-car pileup resulted in a total loss of the car. Finding another car, with infants in the family, was a painful process. The unfortunate part is that the accident could have been prevented, had the driver been a bit more careful. That is the focus of Smart Drivinc – crash prevention.

What’s in a name?

Our solution is supported by smart technologies that make driving safer…hence Smart Drivinc.

Describe your typical client:

Our B2B clients are companies with employees on the road: sales workers, insurance adjusters, etc., for whom we reduce risk by preventing accidents. Our B2C clients are parents of novice drivers, for whom we provide peace of mind.

What does competition look like?

The space is crowded with all kinds of solutions, however, we are the only company that solved this problem in an affordable fashion and created a win-win ecosystem for end users and insurance carriers.

What’s on your to-do list?

The top of my to-do list includes forming collaborations with insurance companies. Our solution not only reduces accidents but also brings new customers to the table.

What are you most excited about with respect to Smart Drivinc?

At the end of the day, what matters and excites us most is providing peace of mind to parents and making our roads safer.

Why are you part of the Global Insurance Accelerator?

GIA occupies a niche, a space that has not been visible before. Combining insurance and technology in the Heartland is a brilliant strategy. For the past three weeks, we’ve met with the best in the industry and were offered unconditional support for our venture. I learned a lot from each individual meeting. GIA has created a mentor pool that is like a library where you can find answers to everything. The best part is they’re one call or one email away from us.

One takeaway:

Make no assumptions, stop “talking” and start “asking.”

Who else has been supportive of your cause?

CEO of MinMor Industries, Joe Morris, is one of our strong supporters. Thank you, Joe!

Biggest challenge:

By profession, I am a bio-optical systems guy, no relation to the insurance or the transportation industries. Developing contacts and traversing these sectors was my biggest challenge. Being selected to GIA solved this problem for us.

Where do you see Smart Drivinc in five years?

Our motto is “Crash Prevention,” and we have several products lined up to address this, with the goal of launching a product once a year. For instance, we are developing a suite of products to personalize one’s interaction with his/her car, starting with the actual purchase of the car, down to maintenance, insurance and even the sale of the car.

Best life lesson:

Believe in yourself; you will have some discouraging encounters.

Is ‘Direct’ a Dirty Word for Insurers?

The second-worst-kept secret of the year, after the launch of Google Compare in the U.S., is Berkshire Hathaway announcing its plans to sell insurance directly to business owners over the web. Quelle surprise.

I recently spoke with a C-suite exec who told me that “direct” is a dirty word.

Perception is reality.

In reality, though, “direct” is a lousy term that doesn’t do justice to the implementations that today’s technology has to offer that are often in direct alignment with an insurance company’s business model.

The conversation becomes uncomfortable to some once the word “middlemen” is introduced. It doesn’t have to be.

There are two primary outcomes to direct selling: (1) eliminating the middlemen or (2) empowering them. For visualization purposes, consider the following three brands:

Quotemehappy.com occupies the left extreme of selling directly to consumers. A spin-off of Aviva since 2011, the online insurer only provides phone support if a customer has a claim. For all other inquiries, there is browsing. Then there are the Geicos of the world, where insurers offer the convenience of buying on the web with the assurance of speaking to an agent, when needed. To the right extreme, Plymouth Rock provides an example of an insurer that has a patent-pending technology that matches online quotes to agents either pre- or post-purchase. There are several other players occupying the comfortable middle with direct-to-consumer models that offer varying degrees of human interaction.

Typically the outcome is determined by the company’s original distribution channel: whether offline, web or mobile. The table below further illustrates how versatile “going direct” can be:

  • Geico, Policy Genius and Cuvva are examples of insurance companies that implemented a direct-to-consumer strategy from the get-go; here, direct is a no-brainer.
  • Plymouth Rock and Quotemehappy.com via Aviva signal companies that implemented a direct-to-consumer strategy in an attempt to address a change in the market.
  • Allstate acquired Esurance to buy its way into the direct market, and so did AmFam with the acquisition of Homesite.
  • Also, AmFam invested in insurance comparison site CoverHound.

When all is said and done, direct selling is first and foremost a marketing channel that empowers the consumer. Sans proper marketing and messaging, the online insurance journey is transactional at best, and players risk commoditizing their product.

“Commodity.” Now there’s a dirty word for you.

A Word With Shefi: David Stegall

This is part of a series of interviews by Shefi Ben Hutta with insurance practitioners who bring an interesting perspective to their work and to the industry as a whole. Here, she speaks with David Stegall, principal consultant with Risk Consulting & Expert Services, who often serves as an expert witness in insurance litigation.

To see more of the “A Word With Shefi” series, visit her thought leader profile. To subscribe to her free newsletter, Insurance Entertainment, click here.

Describe what you do in 50 words or less:

Risk Consulting & Expert Services is an insurance and risk management consulting firm providing services and counsel to commerce, industry and government on insurance, reinsurance and alternative risk transfer matters. I have more than 37 years of experience and often act as an expert witness in litigation.

What made you decide to start Risk Consulting & Expert Services?

After 30 years, I no longer had an interest in continuing to work within the industry as a purveyor of insurance.

And if it weren’t for the appeal of working in insurance, what profession would you be in today?

Film and/or music production. I like the creative process.

Describe your typical client:

A litigation attorney with the need for an insurance or risk management professional who can offer a professional opinion on the usual and customary practices of the insurance industry or the required standard of care used within the industry and can explain that opinion to a judge and jury in plain, simple English.

Memorable court trial:

Very few cases go to trial, yet I recall the irony of testifying on a case regarding flood insurance at the Cameron Parish Court House in Louisiana, which is about a stone’s throw away from the Gulf of Mexico.

Is there a carrier you would love to testify in court against?

I cannot answer that because I do not think of insurance companies as being either good or bad. They are only as good (or bad) as those individuals who are making decisions for them in a given instance, and even then the good (or bad) decision may be specific to that instant.

You have a talent for explaining complicated risk terms. In your experience, which P&C coverage is most baffling to consumers?

Water damage and flood. Flood is excluded in practically every insurance policy (except flood policies), and water damage may or may not be covered. Most people think of the terms synonymously, but they aren’t. The simplest way to think of it is: If the water comes from above (without hitting the ground) it is covered (note that pipes are considered as being above). If the water comes from below (lake, river, stream, ocean), it is not covered. But please read your policy and ask questions of your insurance representative or call a consultant!

You have more than a few designations, one of which is the Chartered Property & Casualty Underwriter. Has the role of underwriting changed much from when you last practiced it?

There are fewer underwriters now, but they are extending specific yet limited underwriting authority to more general agents (or some form or position of limited underwriting authority) that specialize in a particular industry or product offering.

What emerging technology keeps you up at night from a litigation standpoint?

The same as everybody else: cyber risk. The risks are emerging at the same rate as the technologies.

Speaking of cyber, you recently published a whitepaper on “Cyber Risk & Insurance.” The Ashley Madison hack is now correlated to at least two suicides; where do you think insurers should draw the line?

The same place they draw the line with the idea that, if you attend a baseball game, you might get hit by a foul ball. A person does take some risk by subscribing to any service or website – yes, there is an implicit, if not explicit, responsibility (in the form of statutes) to protect people’s privacy but some activities carry innate risk that insurance can only partially address.

Favorite quote/s:

“Everything’s Gonna Be Alright” (Muddy Waters and others) and “It is always getting too late and then it is.” I hope I made that one up, but I’m sure I’ve heard it somewhere, and it resonated.

When you are not working, you are most likely…

Playing with my seven grandchildren or playing the harmonica.

What are you most excited about at the moment?

That I feel happy, healthy and terrific! A phrase made famous by a former insurance professional and fellow lover of Chicago, W. Clement Stone.