InsurTech

Daily Review: InsurTech is Hitting Critical Mass - ZhongAn Sold Over 7 Bn Policies to 490 Mn Customers

MEDICIGlobal Head of Content

Right partnerships will define success stories across industries. The insurance and financial services industries are the ones to benefit the most as it becomes clear that technology companies can bring efficiency into processes and redefine business models.

  • InsurTech

InsurTech Is Hitting Critical Mass

  • Launched in 2013, Chinese non-life insurer ZhongAn has already reached a market cap of $13.6 billion on the Hong Kong Stock Exchange, where it started trading in late September this year. ZhongAn uses artificial intelligence and big data to generate mass market sales over the internet. Its flagship product is a policy that covers the cost of returning products bought on shopping platform Taobao.
  • ZhongAn has sold over 7 billion policies to 490 million customers so far.
  • InsurTech startups represent 15% of the $50 billion invested in the global FinTech arena during the 2010-15 period.
  • Many of the insurance products have become commoditized, driving prices and margins down. For example, 70% of people renewing their car insurance policy in the UK use price-comparison sites.
  • Collaborative win-win opportunities in the upstream part of the supply chain are possible for insurers and startups alike. For example, Shift Technology provides AI solutions for insurance fraud detection and automated claims management.
  • Promising segments for market growth/disruption include mobile POS (e.g. inexpensive insurance for shipping return, flight delay, cracked phone screen), group healthcare and automated claims management.
  • Traditional insurers quick to leverage the relevant startup services while defining a digital vision for themselves might be able to thrive.

Read more on INSEAD Knowledge.

  • Machine learning, artificial intelligence

How Machine Learning Truly Applies To Digital Identity

  • Two broad categories of ML models are clustering (unsupervised learning) and classification (supervised learning).
  • Clustering is the grouping of similar data into groups, where data in the same group is more closely related to each other than to data in other groups.
  • Classification is the process of identifying which label a new observation belongs to, knowing the classification of observations from a fact-based training data set. This method can be used to generate a predictive model to associate multiple advertising identifiers to one consumer or a household.
  • The most effective digital identity solution comes from utilizing a hybrid of these two models. Semi-supervised learning leverages advantages from both clustering and classification algorithms to achieve higher accuracy.
  • In semi-supervised learning, a small amount of labeled data is used along with unlabeled data as the training data set for the model. With this approach, the quality, freshness and statistical relevance of the labeled data can be managed. Another advantage of utilizing this model is to perform household identification using classification techniques with labeled data across household devices and then clustering these household devices into individual groups with significantly smaller labeled data sets.

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Artificial intelligence companies' revenue to hit $3 billion by 2024

  • AI companies' revenue projections are increasing at a fast pace and expected to touch around $3.06 billion by 2024.
  • Deep Learning is expected to have the fastest growth within the AI space and will become the largest portion of total AI companies’ revenue.
  • AI industry has received more than $11.5 billion of investments in the last three years. Over $6 billion of VC investments are expected in 2017.
  • "The necessity of automating processes and the need for AI are reasons for the exponential growth in investments attracted by this space in the past few years," said Puneet Shivam, Head US, Co-head Services Vertical, Avendus Capital.
  • Projected revenue share by vertical by 2020: Medical & Diagnostics is expected to account for 21%, followed by search (20%), sales & marketing (18%), autonomous vehicles (8%), law (7%) and cyber security (6%).

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  • Innovative nations

Government funding aims to transform UK into world's most innovative nation

  • The UK government has unveiled plans aimed at making the UK the world’s most innovative nation by 2030 by investing £725 million to transform industries (including £170 million towards building houses that are more affordable and use less energy, and £210 million to improve early diagnosis of illnesses and development of precision medicine for patients).
  • The £725 million will go into a fund over the next three years, on top of the previously announced £1 billion towards projects. Around £80 billion could be invested in advanced technology in the next decade.

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  • Bitcoin

South Korea’s Largest Underground Mall Adds Bitcoin Payments to 620 Stores

The largest underground shopping mall in South Korea, Goto Mall, has partnered with a local cryptocurrency exchange to enable its 620 stores to accept bitcoin.

Read more.

*Featured image credit: Hatch Conference.

Elena Mesropyan

MEDICIGlobal Head of Content

Global Head of Content, MEDICI

Elena is a research professional with a background in social sciences and extensive experience in consumer behavior studies and marketing analytics. She is passionate about technologies enabling financial inclusion for underprivileged and vulnerable groups of the population around the world.