The Three Pillars of Connected Insurance in Italy

High connectivity is one of the hallmarks of the modern society. At any moment in time, individuals are plugged into society through the range of devices, which as well are constituting a complex ecosystem of smart connected things.

As fairly stated in Harvard Economics Review, Consumers are becoming more and more connected whether it is at home, at work, behind the wheel, when they engage in sports and leisure activities, and so on. This is happening quite fast, due to the adoption of smart devices, and companies have to be able to react accordingly in order to maximize value both for their clients and for themselves.

Connected insurance came into play as an industry that can fully leverage the level and importance of modern connectivity. Matteo Carbone of the Connected Insurance Observatory (the innovative think tank created in Italy by the consultancy firm Bain & Company with the Italian National Association of Insurance Companiesand 30+ international Insurers) defines the term connected insurance is an insurance solution based on sensors for collecting data on the state of an insured risk & telematics for remote transmission and management of the data collected.

Carbone defines telematics as an integrated use of informatics and telecommunication, it is about capturing, storing and analyzing data via telecommunication devices. <…> Telematics could be one of the most relevant digital innovation in the insurance industry directly impacting the technical results. Due to the pervasive diffusion of the Internet of Everything this approach could be extended from motor insurance to other insurance businesses.

Three components of a puzzle create the concept of connected insurance – Health, Motor and Home.

A particular country is believed to be at the forefront of innovation with connected insurance solutions. As Carbone shared, connected insurance concept has been concretely used in Italy along with other markets in motor insurance business.

Italy, being the pioneer in motor business, has a relevant experience either in terms of penetration (~15% penetration), or in defining approach to the market. Moreover, Italy is going into the next innovation wave with home and health telematics offering definition.

Andrea Silvello, Founder & Partner at DigitalTech International, commented on the Italian motor telematics, saying that Italy’s strong automotive industry and the fact the country is a pioneer in working with telematics starting way back in 2002, are the circumstances making Italy the leading market in connected insurance over US, UK and South Africa.

As for the health and home insurance pieces of the puzzle, Silvello adds that, The future of connected healthcare will also be influenced by new emerging models like seamless care, shared care, collaborative care and home hospitals, even if it may take some time. The attribute all these models have in common is their customer-centric trait which will probably become a driver for change, precisely because the current health systems seem to be having difficulties in coping with the current needs of the overall population, especially in overpopulated countries.

The third piece of the connected insurance puzzle is the home insurance market which is expected to reach $235 billion in 2016. Data shows that last year two-in-five insurance firms invested in some kind of project based on connected devices and 45% of insurers believe that connected devices will help drive growth in the next three years.

Italy has quite a developed ecosystem of innovators defining the connected insurance industry. Let’s look at ten of the most interesting players in the market.

The Generali Group (known in Italy as Assicurazioni Generali) is one of the most significant players in the global insurance and financial products market. It was founded in 1831 in Trieste, Italy. In the non-life segment, its portfolio ranges from mass-market coverage such as car, home, accident & health, to sophisticated commercial and industrial risk coverage. The group is actively investing on connected insurance, has a strategic partnership with Vitality and acquired the telematics startup Mydrive last year.

PosteVita is part of the Italian Poste Group and it is a successful bancassurance case history. In the last 10 years, the company was able to become the Italian leader on life and pension business and recently introduced a connected home insurance solution for the P&C business.

OctoTelematics is a telematics service provider, offering an integrated portfolio of telematics solution. The company was acquired by Renova Group in February 2014. The company’s technology captures and analyzes behavioral, contextual and driving data to provide innovative solutions for partners, and is powered by the largest telematics database in the world.

Consiglio dal Medico is an app that allows to receive medical advice from a network of qualified specialists and pay for the consultation by simply touching the screen wherever and whenever desired. Users can reserve a private chat with the doctor, who they can choose from range of profiles of the experts. This startup delivered more than 30,000 medical answers in two years.

UniplSai is the P&C Insurance leader on the Italian market. It was a pioneer on auto telematics since 2003 and currently, its portfolio of more than 2 million of boxes live represent the largest insurance telematics portfolio worldwide.

DigitalTech International is a hi-tech company based in Italy and Singapore/Malaysia, founded to leverage on the experience of the Italian innovative telematics on other business lines, focusing on health, life and home. The company is a SaaS provider for the insurance Incumbents offering a white-label platform to manage the connected insurance user experience and gather data from any connected devices.

Air is a recently constituted MGA telematics based. The company provides insurance solutions and telematics services to the car dealers channel in Italy using an OBD dongle.

Intesa Sanpaolo Assicura is part of the Italian banking group Intesa Sanpaolo and distributes its product on the bank’s branches. The company has created a suite of connected insurance solution ranging from autos to motorbikes and homes.

Neosurance is an Italian startup reinventing the insurance purchase for the millennials with the IoT data usage. The startup created an SDK selling, short-term contextual insurance covers with push notifications and use artificial intelligence to deliver effectively a personalized insurance proposition. Last week, the company was awarded "Newcomer of the Year" at the Insurance IoT Europe Summit.

Qmap is a big data company specializing in data traffic elaboration. Its enterprise platform processes more than 90 millions GPS points per day, creating maps of geo-referenced information.

There are certainly more notable players in the market that are growing and developing with evolving technology and the LTP team will be touching upon it more as the ecosystem grows.