Dealroom：2021年欧洲保险科技报告（英文）

The State of European InsurtechJune 2021European early-stage venture capital firm investing in B2B technology companies.Alma Mundi Insurtech is a 100M€ Venture Capital fund managed by Mundi Ventures that invests in the leading Insurtech innovation, with a clear, but not limited, European focus. The Fund has operational presence in Madrid and Barcelona, but also covers London, Amsterdam, Berlin, Tel Aviv, and Stockholm through Venture Partners.The Alma Mundi Insurtech Fund has built a truly unique value proposition for Insurtech startups: it is indeed a fully independent VC Fund, however invested by several International Insurers: namely Mapfre, Nationale Nederlanden, Mutualidad Abogacía, among other international insurers, mutuality funds, and strategic financial investors from Spain, Switzerland, Middle East, and Luxembourg.. The Fund adds value to its investee companies by leveraging its vast insurtech expertise, leveraging its LPs network and commercial activities, and making them available the network of contacts formed by the investment partners, and a global network of C-level executives called Club Mundi, which was promoted by Javier Santiso, CEO and Founder of Alma Mundi Ventures.Insurtech focused investmentsLimited Partners (LPs)Global startup & venture capital intelligence platform.Dealroom.co is the foremost data provider on startup, early-stage and growth company ecosystems in Europe and around the globe.Founded in Amsterdam in 2013, we now work with many of the world's most prominent investors, entrepreneurs and government organizations to provide transparency, analysis and insights on venture capital activity.Page / 2Insurance is a global $6 trillion industry under pressure, an opportunity for tech companies.The insurance industry is characterized by a fragmented value chain and scarce digitalization of the processes.This has opened this enormous market for the entrance of tech-enabled insurtech challenging or augmenting incumbents.Global market sizeThe European insurtech market is scaling up and will support Europe’s next decacorns.Europe is starting to see big first Insurtech companies emerge in health insurance (Alan), P&C insurance (Wefox, Zego) and SaaS for insurers (Shift Technology).The scale of the market means Insurtech could support Europe’s next multi-decacorn(s).Combined value of European Insurtech$5T$6T$8T $12TMobility Insurance HealthPage / 3Source: Dealroom.coFinancial sector ex. insurance€4B 2016€23B TodayInsurance is broadening and shifting toward service led models.Insurers and insurtechs are expanding towards “beyond insurance services” including risk analysis, prevention and replacement services.This transformation is fueled by the availability of contextual data and is shifting the role of insurers into service companies.Smart homeMobilityConnected industryData intelligence and cybersecurityWealth management and retirementConnected healthWhy this Insurtech report.The concept of disruption has often been called and abused in the insurance space. The industry is indeed a hard moat to disrupt, heavily regulated, capital intensive, and has seen little evolution in the last decades.Now, however, a combination of new customer expectation, accelerated digitization, increased availability of emerging technologies (AI, IoT) and the reached maturity of the wave of first insurtech startups is fueling a rapid transformation. In the past years, most of the focus has been on the distribution layer, but now the attention is embracing all key industry processes.The role itself of insurance is evolving. Insurance is increasingly becoming embedded into platforms and ecosystems and coupled with other services from repairs and maintenance to health services and prevention. Insurance is moving beyond pure risk transfer to risk management and prevention. Will it succeed? Will the insurers and insurtechs play a central role in this or will insurance become a commodity?Page / 4A big thanksContributions and insights from conversations with:Javier Santiso Yago Montenegro Mendez Lluís Viñas Fernández Lorenzo ChiavariniMundi VenturesMundi VenturesMundi VenturesDealroom.coOrla Browne Dealroom.coMatthew Jones Anthemis GroupMehrdad Piroozram InsurTech.vcMeera Last Former secretary UKInsurtech BoardVijay Vaswani Eos Venture PartnersJulian Teicke WefoxFranz-Xaver Burner bsuranceChris Lee ExanteJimmy Williams Urban JungleDan Roberts NaymsChristian Macht ELEMENTAdam Rimmer FloodflashNicolai Baldin SynthesizedRoberto Valdes CuideoSECTION 1: INTRODUCTION1 The insurance industry is under pressure to evolve and insurtechs are increasingly playing partWhat is insurance?Insurance is a first line of defence for people, businesses, and governments. In its simplest form, it is a means of financial way to hedge and protect against the risk of a contingent or uncertain loss.“We like to understand insurance as one of the most clear examples of communitycare...as a matter of fact, insurance is nothing more and nothing less than sharing arisk with other people, who are happy (or should be) to support you when thingsdon't go as expected.”Lluis Viñas"We think more about risk management; we do not really care about theInvestment Associate Mundi Venturesunderlying product... it could be insurance, derivatives, or simply some softwareto identify and monitor risks.”Matthew Jones Managing Director Anthemis Group“Insurance is an industry that fundamentally helps protect things that we hold dear—like our life, our home, our business.”“Insurers have a social and societal responsibility. Insurance is something everyone needs. It is a basic right, a kind of civil duty and therefore should be accessible to everyone.”Meera Last Former Secretary UKInsurtech BoardPage / 6Vijay Vaswani AnalystEos Venture PartnersThe insurance value chain is complex and fragmented, especially in distribution, leading to high industry costs.Customers (consumers & businesses)Distribution TraditionalAgents, Brokers & AggregatorsBanks and other partnersCore insurance stackClaim MgtUnderwritingProducts & pricingLicense & risk coverageInsurersDirect >10%(1)CapitalReinsurersTraditional and alternative capitalInsurance industry expenses(2)Less than 65% of the paid premium goes back to the customers as paid claims. The rest is consumed by insurers overheads expenses. Distribution costs are enormous, accounting for almost 50% of the total cost.Claims management 2.5% Other operations 15%Distribution 17.5%Loss ratio/claim 65%Page / 7Source: Dealroom.co. 1. Varying among lines. Motor insurance has 23% share of direct sales 2. Figures for a median P&G multichannel insurer, adapted from McKinsey “The productivity imperative in insurance”Operating costs have even worsened in the last decade, squeezing the margins for insurers, but digitalization is starting.Insurers operating costs increased by 80% of insurers made negligible or negative economic profits in the years running up to the Covid crisis, however, the long-overdue digitalization of the industry is accelerating with the pandemic forcing to adopt virtual meeting with clients and the digitalization of policies.Cost efficiency evolution per industry, %, normalized at 100% in 2009 (1)Digitalization in insurance140Insurance+35%120100TelecommunicationAutomotive80Airlines0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018Page / 8 Source: Dealroom.co. 1. McKinsey “The productivity imperative in insurance”, “ The great acceleration”23% 201931%* 2020“We benefit from 360-degree visibility on the movements and developments of the leading insurers and the disruption from emerging, fast-growing players. The increase of competition is creating a breeding ground for innovation that will transformthe insurance industry for the benefit of the people.”Javer SantisoCEO & General Partner Mundi VenturesMehrdad PiroozramFounder & Partner InsurTech.vcPage / 9“Regulation is the toughest you can face in any industry, it is also very capital intensive. The barrier of entry is really high, but increased capital availability from investors and the maturity of a first wave of insurtechs are changing this.”Insurance is a strong defensive moat, with its high capital intensity, strict regulation and established brandsLarger capital availability from VC and PE world, as well from insurance incumbentsRegulationRegulatory capital requirementsHard to get consumer trust for a young startups in insuranceCapitalCost of customer acquisition (CAC) Especially in L&H lines where customers change insurance 1.5 times in their lifetime on average.Trust and BrandInsurtechs maturing and gaining trust ofincumbents and customersPage / 10 Source: Dealroom.co.The insurance sector is one of the biggest industries with a massive $6T global market.Global market size$12T$8T$6T $5T$5T$6TMobility Insurance$8T$12THealthFinancial sector ex. insurancePage / 11 Source: Dealroom.co.Insurtech has been so far underinvested compared to other sectors but is now growing much faster.VC global investment by industry: 2016 vs. 2020Insurtech HealthMobility Fintech4.1x 2.6x 1.9x 1.4x2016 2020$1.8B $7.3B $24.2B $62.6B $22.2B $42.5B $23.9B $33.8BSECTION 1: INTRODUCTION2 The emerging startup scene: augmenting or disrupting insurers2021 has already broken every record for European insurtech, surpassing the all-time high in 2020.VC investment in European insurtech startupsNumber of VC rounds >€2M▊ Actual ▊ 2021 annualized based on Jan-May€4.2B7865 64€1.8B€1.1B €1.2B€0.6B €0.4B €0.1B2016 2017 2018 2019Page / 13 Source: Dealroom.co.20202021 TD51 4134 172016 2017 2018 2019 2020 2021 TDExplore European Insurtech roundsVisit insurtech.dealroom.coEuropean Insurtech companies are now worth €23B billion.Combined enterprise value of European insurtech startups (1)€23B€14B€17B€9B €7B €4BCombined enterprise value of European insurtech startups46%P&C challengers, full stack & MGAs12%L&H challengers, full stack & MGAs25%Distributors, brokers and SaaS for distribution16%SaaS for product & price, underwriting and claim20162017201820192020TodayPage / 14Source: Dealroom.co and Google Finance. 1. VC-backed founded after 2000. Using estimated valuations based on most recent VC rounds, public markets and publicly disclosed valuations as of June 2, 2021.Despite being the largest insurance market, Life and Health (L&H) has been underinvested compared to product & casualty insurance (P&C) in Europe.Premium written in Europe by sector in Europe(1)€1.25TrEuropean VC funding split by sector▉ Life and Health ▉ Product and Casualty20%35%17%28%24%26%68%32% 2020Page / 15 Source: Dealroom.co. 1. Insurance Europe https://www.insuranceeurope.eu/80%65%83%72%76%74%20162017 2018201920202021 YTDEuropean insurtech has been highly centred around the UK, Germany and France, which attracted more than 85% of the funding since 2016.UK, France and DACH/Germany also host the largest (re)insurance companies in EuropeShare of European VC funding 2016-202140%29%18% 14%UK Germany FranceRoE5% Other2% Netherlands 2% Spain 2% Italy4% SwitzerlandPage / 16 Source: Dealroom.co.Insurtechs in other countries have attracted a significant share of early funding rounds but have not scaled up significantly in follow up rounds.Geographic split by round count▉ RoE ▉ France ▉ Germany ▉ United Kingdom35%34%35%34%37%29%7%10%8%12%12%21%30%17%17%14%13%17%28% 201640%39%2017201840% 201938% 202033%2021 TDPage / 17 Source: Dealroom.co.Geographic split by round stage 2016-2021▉ RoE ▉ France ▉ Germany ▉ United Kingdom8%15%25%31%25%21%55%15%11%29% 25%29%14%6%21%9%29%49%44%50%31%36%23%Pre-seed €0-1MSeed €1-4MSeries A Series B Series C Megarounds €4-15M €15-40M €40-100M >€100MInsurtechs are gaining credibility in the eye of incumbents, almost 40% of the rounds in 2020 and 2021 had strategic investors participating.Percentage of European insurtech rounds with at least one strategic investor*39% 38% 35% 33% 31% 28% 22%10%By stage (2017-2020)* 55%47%25% 15%2014 2015 2016 2017 2018 2019 2020 2021 TDPre-Seed Seed €0-1M €1-4MSeries A Series B+ €4-15M >€15MPage / 18 Source: Dealroom.co. *considering only direct investments. Insurers and reinsurers are also often LPs of insurtech focused VCsThe European Insurtech scene has strong domestic support at (pre) seed and Series A, while needs to rely on foreign capital to scale upVC investment in European insurtech by investor geography (2016-2021)▉ RoW ▉ Asia ▉ USA and Canada ▉ Europe14%%3% 2%2% 6%7%10%13%9%9%11%19%31%45%86%85%81%9%74%59%42%Page / 19Source: Dealroom.co.Pre-seed €0-1MSeed €1-4MSeries A €4-15MSeries B €15-40MSeries C Megarounds €40-100M >€100MNotable investors into European InsurtechSector agnostic European fundsEuropean funds with dedicated Insurtech focusStrategic investors (Insurers, reinsurers, financial sector)Series B+U.S. / Asian investorsSeries A(Pre) SeedPage / 20Source: Dealroom.co. Funds hand-picked based on number of investments in Insurtech and (future) unicorns.B2B SaaS solutions are attracting 50% of the rounds in 2021, even if just 20% of the total fundingPercentage of funding into B2B SaaS startups60%28% 10%46% 39%35% 30%20%2014 2015 2016 2017 2018 2019 2020 2021T DPage / 21 Source: Dealroom.co.Percentage of rounds into B2B SaaS startups56% 52% 50%45%40% 39%41%38%2014 2015 2016 2017 2018 2019 2020 2021T DDistribution has attracted most of the funding in the past years. Now, full stacks insurers are attracting increasingly more capital needed for their expansion. In their shadow, SaaS for product and pricing, underwriting and claim management is maturing.VC investment in European insurtech startups by value chainNumber of VC rounds in European insurtech startups by value chain▉ full stack ▉ claim ▉ MGA ▉ Distribution and brokerage ▉ underwriting ▉ product and price4%3%16%15%16%22%15%5%7%17%13%5%54%45%21%5%18%18%37%7%15%10%6%8%8%9%18%12%12%15%11%13%19%16%16%19%17%21%15%11%53% 39%3% 6%20159% 1% 2016Page / 22 Source: Dealroom.co.29% 44%24%2% 20178% 1% 201826%18% 11% 201925%11% 4% 20207%20%11% 7% 1% 2021 TD41%43%46%40%45%41%42%10% 8% 201511%1% 201614%4% 201712% 5% 201814%4% 201911% 3% 202017%4% 2021TD“Insurance is a data driven business. The insurance industry is compelled to work with highly sensitive data, but this brings challenges from regulation and customer trust. Such challenges can be overcomed with the use of artificially created data products in a safe, privacy preserving environment.”Nicolai BaldinCEO & Founder SynthesizedMehrdad PiroozramFounder & Partner InsurTech.vc“Insurers are increasingly forced to adopt AI-, SaaS- and cloud-solutions to keep up with market requirements.”Page / 23More and more startups are helping insurance companies to improve key processes such as pricing, underwriting and claim management.Optimization of product composition and pricing with AI and big data to improve product offering and build more accurate risk prediction modelsNew data sources and analytic capabilities enable a better risk assessment to drive more accurate underwriting and prevent fraud.Claim management is a time and cost consuming process: workflow management solutions and applications of computer vision, imagery analytics and IoT are improving it and preventing fraudulent claims.Insurers are tapping into new or previously unused data sources, the massive advancements in computing power and data analytics allow real-time analysis and flow integration.Page / 24 Source: Dealroom.co.Discover the companiesFraud detection & compliance | underwriting and risk engine | claim management | claim analytics | data providers & data analytics90 + SaaS solutions improving key insurance processes »Managing General Agents (MGA) are an engine of innovation in insurance thanks to their agility and speed but are still dependent on insurance carriers.Unlike a traditional broker, an MGA is able to underwrite risks using 3rd party capital. The MGA gets access to capital and fulfils its regulatory requirement by reaching an agreement with one or more insurers that are prepared to “delegate” their underwriting authority to the MGA. Doing so the MGA doesn’t retain any capital.InsurersCore insurance stackDistributionClaim MgtClaim MgtUnderwriting UnderwritingMGAProducts & pricingProducts & pricingLicense & risk coverageCapital ReinsurersTraditional and alternative capitalPage / 25 Source: Dealroom.co.Advantages● Capital efficiency and limited regulatory requirements● Shorter time to market ● Controlling the key elements ofdifferentiation around product, underwriting, distribution and technologyDisadvantages● Dependency risk on the insurance carrier● Lack of flexibility to try and test new products● Profit-sharing with the insurer“There has been a trend of distribution moving down the stack. Most of the businesses out there started as brokers andquite quickly started to jump down on the value chain. At Urban Jungle started as a broker but became more an MGA tohave freedom to design the product and pricing.”Jimmy WilliamsCo-founder & CEO Urban JungleJulian TeickeFounder & CEO wefoxPage / 26“Direct is very tough to crack, we tried and failed miserably, we had very bad unit economics and we turned to B2B2C distribution and then expanded also to full stack. Many players are integrating downstream towards full stack, few will actually make it to become profitable, but the ones who do can seriously challenge incumbents.”Competition in customer acquisition led traditional brokers and marketplaces towards downstream integration and differentiation.Downstream integrationOnly distribution &MGAs (+product,customer engagement pricing, underwriting)Full stack● Customer acquisition with competition becomes very high so to reach profitability brokers and distributors started to expand downstream become MGAs.● MGAs are then going full stack when they reach scale to have the flexibility to try and test new products and avoid sharing profits with insurersTargeting niche sectorsPage / 27 Source: Dealroom.co.Expansion from nicheSeveral insurance lines● The second wave targets more niche segments● Once validated the model in a niche, MGAs and full-stack insurtechs are expanding in broader segmentsThe Wefox journey from B2C broker and technology provider to challenger full-stack insurtech.Revenue sources100% commissionBeginning to add direct premium70% commission 30% direct premiumJulian Teicke founded Wefox in 2015. Positionedas a B2C insurance brokerJuly 2015Repositioning as B2B2C technology provider forinsurer advisors2016Acquisition of licensed insurer One. Incubate asseparate brand.Jun 2017Adding subscription revenue from risk Adding revenues from embeddedpreventionplatform distributionWefox announced it will launch a risk prevention product “Wefox Prevent”2022Transform the Koble platform into an embedded distribution platform connecting insurers and distribution channels2024Launch of Koble platform: an open platform for digitalinsurance distribution at scale. Incubate as separatebrand.Oct 2020Wefox distribution, One and Koble reunited in asingle brand.March 20212030 vision50% direct premium 30% 3rd party commission10% subscription and 10% platforms → but main margin generatorsPage / 28 Source: Dealroom.co.Europe has a strong pipeline of current and future unicorns, but they have not exited differently to the USVC funding 2016-2021VC-backed exits at a $1B+ valuationUS€19.7BUS12Europe€5.5B3.6xEurope 0Cumulative number of unicorns and $1B exits (founded after 2000)US23Europe54.6xCumulative number of future unicornsUSEurope11Page / 29 Source: Dealroom.co.29 2.6xThe US has seen a flush of exits in the last year, driven by full-stack, but performances have been poor. Is the insurance carrier model back in fashion?TargetRoleFounding year Prior funding (1)Exit Valuation % Change since IPO(2)DateOscar HealthOnline healthcare insurance providerFull stack2012$1.6B funding + $1.4B in IPO$7.9B-41%Mar 2021Root InsuranceCar Insurance that incorporates individual driving behaviorFull stack2015$535M funding + $724M in IPO$7.0B-66%Oct 2020LemonadeInsurance carrier, offering homeowners and renters insuranceFull stackMetromileA variably-priced, pay-per-mile car insurance providerFull stackClover HealthChallenger technology driven health insurerFull stackGoHealthOnline portal for finding health insurance coverageDistributionAlignment HealthcareChallenger health insurer reinventing medical processesFull stackDoma (ex States Title)Streamlining the title insurance underwriting and mortgage MGA closingHippo InsuranceOffering modern insurance for house and office propertiesFull stack2015$480M funding + $319M in IPO2011$391M funding + $250M in SPAC IPO2014$925M funding + $1.2B in SPAC IPO2001$75M funding + $913M IPO2013$375M funding + $490M in IPO2015$105M funding + $650M in SPAC IPO2015$660M funding + $770M in SPAC IPO$1.6B $1.3B $3.7B $6.6B $3.3B $3.3B $5.0B+179%Jul 2020-27%Jan 2021-23%Jan 2021-44%Jul 2020+31%Mar 2021/Q2 2021/Q2 2021Page / 30 Source: Dealroom.co. 1. SPAC IPO amount includes PIPE transaction 2. Current valuation from Google Finance at 18 May 2021Especially in insurtech, time is needed to scale. The 2015-2016 cohort has attracted the bulk of funding in Europe and US. We will soon see major exits also in Europe.European insurtech VC funding by startups launch yearEurope 2015-2016€1.4B €1.2B€0.6B €0.5B€0.3B€0.2B€0.1B€0.5B €0.1B €0.0B €0.1B €0.0B2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021TDUS insurtech VC funding by startups launch year €4.5B€1.9B€2.1B€3.0B €2.6B€0.7B €0.6B€1.0B€0.5B €0.5B €0.1B €0.0B2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021TDPage / 31 Source: Dealroom.co.US 2015-2016Exited/exitingSECTION 1: INTRODUCTION3 The future of insurance: new trends and emerging risksEmbedded insurance holds the promise to bring benefits to all the actors involved and is projected to grow tenfold in the next decade.Embedded insurance means that the insurance product is not sold to the customer ad hoc but is instead provided as a native feature, embedded in a platform, marketplace or ecosystem.Embedded insurance P&C market share(1)24%12x2%2020Page / 33 Source: Dealroom.co. 1. Simon Terrace2030Platform/Merchant/Tech partner- significant revenue stream (average 18% of total revenues) - customer retention - improved customer serviceInsurer- lower cost of customer acquisition - greater availability of data - increase loyalty and retention - reduction in distribution costsCustomer- more relevant products - streamlined customer experience“Embedded insurance can bridge the gap between the digital lifestyle of consumer and the current insurance capabilities andofferings. This requires flexibility and speed from a product development side, that's why we've invested in building a greatteam and a B2B2C digital insurance platform for easy onboarding, claims processing and payments.”Franz-Xaver BurnerCGO & Co-Founder bsuranceChristian MachtCEO ELEMENTPage / 34“The biggest challenge in embedded insurance is to get the product right. Embedded solutions finally offer the chance to make insurance products more specific and relevant for customers. We are looking forward to pushing this process and act as a reliable underwriter and license provider for MGAs and other players to offer embedded insurance proposition.”However embedded insurance requires a new industry technology stack and new players are filling this gap.More than 50% of the distribution partners are dissatisfied and found significant challenges in the partnerships established mostly due to: -Legacy systems and the lack of digital competence from insurers, especially the lack or the poor state of APIs for integration(1)Provider of infrastructure for distribution and customer engagement partnering with insurers and distribution partnersFull-stack provider of insurance infrastructure and underwriting capacity for MGAs and distribution partnersPage / 35 Source: Dealroom.co. 1. Penny.io report on embedded insurance partnershipsDiscover the companiesInsurance as a service | Platform providers | SaaS for embedded distribution| B2B2C embedded MGAs40+ startups enabling the rise of Embedded Insurance »Emerging and new risks: five of the six most concerning global risks are related to environmental challenges.Environmental challenges and climate change drive risk concerns at a global level, with extreme weather as the most likely riskGlobal risks landscape(1) How do respondents perceive the impact and likelihood ofglobal risks?EconomicEnvironmentalGeopoliticalSocietalTechnological4Weapons of mass destructionInfectious diseasesClimate action failureTop risks By likelihoodExtreme weather Climate action failure Human environmental damage Infectious diseases Biodiversity lossTop risks By impactInfectious diseases Climate action failure Weapons of mass destruction Biodiversity loss Natural resource crisisBiodiversity lossNatural resource crisisHuman environmental damage3.5Average 3.40Interstate conflict Debt crises IT infrastructure breakdownLivelihood crises Cybersecurity failureExtreme weatherSocial security collapseProlonged Social cohesion erosion stagnation Involuntary migrationInterstate relations fractureAsset bubble burstDigital power concentrationImpactPage / 36 Source: Dealroom.co. 1. WEF: The Global Risks Report 20212.53Average43.28Likelihood3.5However, almost 70% of global climate-related losses have been uninsured in the last 15 years. What will happen for insurers when the climate crisis really bites?In the last 15 years the protection gap, the amount of not insured losses, have not been closing. The impact and financial cost of natural disasters will only increase.This requires a rethinking of current insurance models. The industry needs to ensure more people have access to insurance product in the future.Especially the industry needs to develop more affordable and scalable products for the underserved and more vulnerable categories.Page / 37 Source: Dealroom.co. 1. Aon annual report 2020Proportion of uninsured global losses from severe weather events 2005-2020(1)2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 202042% 27%31% 33% 31% 19%39% 33% 25% 30% 28% 27% 34%39% 31% 34%▉ Insured losses ▉ Uninsured losses58% 73%69% 67% 69% 81%61% 67% 75% 70% 72% 73% 66%61% 69% 66%“The traditional market has been unable to provide a product affordable for the 70% of uninsured losses. Parametricinsurance can provide solutions that were not available before.”Adam RimmerCo-founder & CEO FloodflashChris LeeFounder ExantePage / 38“Insurance companies are very good at paying a lot of money, very very slowly. This works well if you are middle class with savings, but now increasingly more people are coming out of poverty but still very susceptible to financial losses, living day to day with pay. Parametric insurance is a way to put a bandage on a bleeding wound.”Parametric insurance: transparency, speed, certainty.In parametric insurance, the premium and payout are automatically calculated from a list of parameters bringing benefits such as:● more transparent pricing and faster, effortless claim resolution for the customers● Reduced uncertainty for the insurersParametric insurance is not new, having been used for almost two decades in the catastrophe reinsurance industry. What is interesting now, is for parametric insurance to capture data sources, new or unused. This is enabled by the higher availability of IoT data and enhanced analytics capabilities.Specialist MGAs offering parametric products leveraging IoT and data analytics, for climate and weather-related events (flooding, hurricanes, wildfire), but also business continuity, cargo transport and travel.Satellite and aerial imagery, IoT and AI to provide accurate data on a large scale but with high resolution, for risk management, underwriting and claim triggering and processing.Page / 39 Source: Dealroom.co.Discover the companiesclimate and weather MGAs | business continuity, cyber and cargo MGAs | technology providers | data providers60+ pioneering parametric solution to streamline insurance»Intangible assets currently account for 90% of the S&P 500’s total assets, up from just 17% in 1975...Evolution of assets composition of S&P 500 companies 1975-2020(1)▉ Intangible assets ▉ Tangible assets17% 32%68%80%84%90%83% 68%197532% 1985 199520% 200516% 2015Page / 40 Source: Dealroom.co. 1. Ocean Tomo intangible assets study, Ryskex10% 2020...but insurance has yet to start with themIntangible assetsService contractsIntellectual property (patents)GoodwillSoftwareDataBrandThe insurance sector still has for the most part to figure out how to offer cover for these assets.The first segment which is starting to cover intangible assets is cyber insurance covering IP theft, reputation damage, business interruption, liability and digital assets, including crypto assets.Cyber insurance is a top-of-mind concern for corporates and SMEs, however, it is still strongly underdeveloped.The severity of cyber attacks is poised to accelerate also driven by recent trends in remote work across industries, the increasing reliance of businesses across widely varied facets of operations and the emergence of new technologies.Less than 1% of the global cyber losses were insured in 2020Global cyber losses 2020:€1TGlobal cyber insurance GWP2020: $5BThe cyber insurance market is poised to grow more than 30% per yearGlobal cyber losses(1)Global cyber insurance gross written product(GWP)+50%$1T$600B20182020+32% CAGR$20B$5B20202025Page / 41 Source: Dealroom.co. 1. McAfee report “The Hidden Costs of Cybercrime”But cyber insurance brings massive underwriting and risk management challenges that require both incumbents and cybersecurity startups to establish partnerships for integrated cybersecurity offers.Examples of incumbents partnershipsMain challenges● Complex underwriting: new and hard to predict risk (lack of historical data), especially for SMEs.● Systemic risk: the extent of the damage from a single breach can be massive (ex. supply chain breaches).Strategies● Partnerships between cybersecurity specialist or cyber insurance specialist with insurers.● Integrated offers of cybersecurity products and services.Cyber insurance product offered to Google Cloud customers. Target US companies with annual revenue between $500M and $5B, and cover up to $50M in losses.Allianz and Munich Re will integrate with Google Cloud to access customers’ data to better assess the cyber risks they face and provide more personalized protection.Cisco, Apple, Aon and Allianz announced a new cyber risk management solution for businesses.Aon will provide resilience evaluation services, Cisco and Apple the cybersecurity technology and Allianz the option for enhanced cyber insurance coverage.Page / 42 Source: Dealroom.co.“The commercial cyber insurance market is ripe with opportunities and challenges. The market is in its early stages, losses can be huge and risk mitigation can be very challenging.The key to the SME segment is an integrated offer with more proactive discounts for cyber security software, active riskmitigation, employee training and automated underwriting.”Vijay VaswaniAnalyst Eos Venture PartnersDan RobertsCo-Founder & CEO NaymsPage / 43“Our smart contract powered marketplace allows assets to match liabilities when underwriting digital asset risk, allowing underwriters and brokers to engage in risk transfer with capital markets. We provide the infrastructure to allow forerunners to cover new markets and improve existing ones.”Insurtechs and cybersecurity specialists are closing the gap by insuring digital and intangible assets.Cybersecurity specialist partnering with insurers and insurtech startups bringing competencies in cyber risk assessment and security solutions for an integrated offer.Specialist MGAs and brokers offering products designed to help small business mitigate cyber losses leveraging automated underwriting expertise.The crypto space is beginning to be insured, either through decentralized alternative to insurance and players building the infrastructure for its financing.Page / 44 Source: Dealroom.co.Discover the companiescyber risk | digital assets | automated underwriting | SMEs solutions | crypto assets50+ Startups developing insurance solutions for digital assets and the cyber security »SECTION 1: INTRODUCTION4 The new role of insurance: beyond risk capacity to ecosystems for risk prevention and ancillary services“As we experience the largest transformation in the insurance industry in recent history, the role of insurers will expandbeyond pure risk capacity providers to lead the provisioning of risk prevention and ancillary services to their customers.”Yago Montenegro MendezInvestment Director Mundi VenturesJulian TeickeFounder & CEO wefox“Availability of contextual data will change the role of insurers from offsetting risk to actually prevent it, shifting the role of insurers into service companies. That is insurance getting in its sweet spot. This will make the difference between the companies that will be around or not in 10 years.”“Accelerated ageing is a fact across european population. Insurance corporations have the opportunity to be a relevantplayer in the senior market by delivering quality-driven care services to its customer base and building long-term savingplans to finance the elderly care.”Page / 46Roberto ValdesCEO CuideoInsurance is broadening and incumbents are partnering to offer a broader ecosystem of services.Insurance is usually a part but seldom a full solution to a problem consumers are facing. “Beyond insurance services” including risk analysis, prevention, and replacement services which are to be considered when designing a new product (e.g. cyber), as well as adjacent services like health benefits. This means the value-added service layer is getting bigger, while the insurance slice is shrinking.MobilityVehicle/car repair and concierge servicesNew ownership modelsSafetyCyber securityPage / 47 Source: Dealroom.co.Connected industryHealth services and benefitsPredictive maintenanceSupply chain and logisticsConstruction risk managementHome and propertyEmployee benefits, gig economyInsurance remittanceWellness productsMental healthRental industry (ex. deposit guarantee)Repairs Smart homeRewards and discounts for healthy behavioursSpecific evidence based treatmentsFinancial wellness and retirementSaving management and financial adviceElderly careCompanion for end of lifeThe vast majority of (re)insurers investments are in fact outside the boundaries of strictly insurtech.More than 75% of (re)insurers investments are “outside insurtech” towards fintech, health and wellness, enterprise sector and much morePercentage of (Re)insurers investment rounds “outside insurtech”78%81%72% 68% 71% 62%2016 2017Page / 48 Source: Dealroom.co.2018201920202021 TD(Re)insurers investment by industry “outside insurtech” (2016-2021)Fintech (exc. insurtech) Health and wellness Enterprise softwareTransportationSecurity (inc. cyber security)Real estateMarketingTravel22% 21% 16% 9% 8% 7% 4% 4%Will insurers retain a leading role and drive the future of healthcare?Healthcare is becoming: proactive, decentralized, personalized and value-based. Health care and treatment coverages are not even the products of the future, wellbeing and prevention are. The opportunity is huge, especially post-Covid, but equally is the threat. On one hand, digital players, like telemedicine players, could bundle an insurance product into their offering which they source directly from the reinsurance market. On the other hand, insurers can build health ecosystems providing incentives to adopt healthy behaviour, focus on prevention and add telematics services to their offer.█ Well-being & focused spending █ Care and treatment focused spending18%61%Discover where the future of health is headed in ourHealthtech report83% 201939% 2040E (1)Page / 49 Source: Dealroom.co. Health Tech - Inkef Capital, MTIP, Dealroom report 1. Based on Deloitte.Introducing the new home for Insurtech: insurtech.dealroom.coAccess now!Navigate 3,000+ insurtech startups & more