“Digital transformation, we need to differentiate between insurance and banking” – Karen Geva Product Innovation Expert, Israel

Israel, one of the world’s oldest but great country, are they catching up with today’s innovations and digital transformations? How the insurance and finance being patronized by local consumers – how they’re being regulated?

We’re fascinated by how Karen Geva, Product and Innovation Expert answered our curiosities and relate Israel’s prevailing startup scenes to tomatoes – but we are captivated by her insights about their insurance and finance updates. 

How will you excite a ten-year-old with the latest updates and development of Insurtech and Fintech happening in Israel?

The Israeli startup ecosystem resembles the process of growing tomatoes in a greenhouse—you need  good temperature control and plenty of light. It’s not cheap to build a greenhouse and underlying the infrastructure needed to provide just the right amount of water and light. But once you have the infrastructure in place, if you play your cards right, you will be able to sell your crops. The infrastructure for the Israeli “greenhouse” is provided by the great entrepreneurial atmosphere in Israel helping startups grow and identifying the right opportunities. 

There are a lot of farmers growing tomatoes in a greenhouse very similar to ours; however, our tomatoes are being sold like hot cakes. Why is that? Because we planted just the right seeds, which usually come from the technological unity of the Israeli army. We have just the right infrastructure and our tomatoes are just a little sweeter—meaning, we have the “Hutzpah” flavor that helps our startups open the doors in other regions. Now you can see why it’s not a coincidence that cherry tomatoes were invented in Israel.  

How does digital transformation affect Israel’s insurers, banks, and customers? How are they reacting to the changes especially those traditional insurers and banks?

When talking about digital transformation, we need to differentiate between insurance and banking. Banks have been in the digital transformation game for more than a decade, so their position is a bit different from insurance which only started the journey a few years back. 

Israeli banks are semi-digital, some more, some less but overall they are innovation savvy. However, the Israeli banking industry is risk averse, which discourages them from making a frog leap into an innovative value proposition. The Israeli regulator, on the other hand, is pushing the banking industry towards transformation by pushing mind-changing reforms like open banking. In that sense, the Israeli banking industry is aligned with global climate with one exception, the Israeli market is small therefore competition is limited so the regulator is much more aggressive in the actions it is taking. 

The Israeli insurance industry is a little different. The regulator is pushing towards changes in the industry that generate aggressive competition between everyone involved, carriers and agents alike. This aggressive competition, in my opinion, is one of the barriers to innovation. When you are busy fighting to maintain your market share and everything is open for grabs, you don’t invest in roads that you haven’t traveled before. Most, not all, Israeli insurers are far from being innovative. They are still in the first stage of digital transformation trying to do the same as they did but with the help of technology. 

What use cases, start-ups, and incumbents doing a great job should insurance and banking professionals around the world know from your ecosystem that are not famous (yet)?

I wouldn’t want to point at anyone in particular as there are so many good use cases out there that demonstrate innovative thinking and are doing a swell job. However, if there is one thing I have noticed it is that what all these good companies have in common is the fact that they put a lot of emphasis on user experience. All of these good companies make the customer the heart of their business, from planning to operations. I believe that in the digital race towards innovation some companies forget that technology is the means rather than the purpose. Some startups and incumbents alike fall in love with new technology but they don’t always find a good enough use case for it. When good technology serves a customer and not vice versa this is where success lies. 

Can you share 3 references everyone should get if they want to know more about Israel’s startup ecosystem?

There are a lot of podcasts, blogs, vlogs and what not, doing a really good job introducing the “startup nation.” However, I chose to put a spotlight on those who provide a good overview of the industry especially for the outsider: 

Startup Nation Central – is a non-profit organization focusing on connecting businesses, NGOs, and governments with Israeli startups. Once a year, they issue a report on the Israeli startup ecosystem providing in-depth analysis of top technologies, reviews of the top sectors and a spotlight on those worth mentioning. 

Viola notes – a blog written by one of the most prominent VCs in Israel, Viola Group. I like their blog because it provides you with a glance at what’s hip in the Israeli entrepreneurial space. You would probably expect that a blog owned by a VC would be talking about their portfolio companies. Well, it does, but not just. Their blog also talks about the Israeli hi-tech industry in general, Israeli entrepreneurial culture and offers great advice for future entrepreneurs.  

Startup Camel – a great podcast about Israeli startups. The host, Adir Freilich, is doing a marvelous job introducing young startups, innovation hubs, and interesting organizations in the Israeli innovation space. 

Your Dos and Don’ts for young people who want to enter the fast-moving worlds of fintech and Insurtech.

Definitely DO – take your time learning the traditional industry. Starting out in Insurtech, I sat in an insurance agency for six months to learn the trade. Later on, when I had to learn more about the American insurance industry I conducted a series of interviews with professionals in the industry just to learn about their jobs and understand their role in the system. I believe that when trying to revolutionize a traditional industry, you need to first learn how it operates so that you can craft your value proposition in a way that brings real change. 

DON’T – don’t assume this journey will be easy. Be ready for a bumpy road ahead and take a deep breath. For both insurance and banking, innovation takes time although it seems that your startup is running full speed ahead. You will have to pitch your ideas time and time again, sometimes to the same people sitting in the same boardroom. Don’t be discouraged as new ideas take time to settle when it comes to working with the incumbents. But, once you do get the message across, there is no greater satisfaction than this.  

As for those of you working for the incumbents, my advice is to look for a good partner within the organization. It’s not an easy task to change how an organization thinks or operate. You will need a good partner to help you steer things in the right direction, someone who is committed and shares the enthusiasm. The reason I chose to work for a bank, although far away from the insurance space I love, is because I identified a partner who is truly committed to revolutionizing the bank and not afraid of challenging the paradigm. Lucky enough this partner, my boss, is also the CTO of the bank.

To know more about you, please allow our curiosity for your 3 books everyone should read and 3 your gadgets everyone should have.

I am quite the book worm and try to read at least one book a month (although I admit that with my hectic schedule that is not always the case). There are three books I’ve read which left a mark:

Predictably Irrational by Dan Ariely – I read this book about ten years ago when it first came out. I remember reading it when I landed my first managerial position and since then nothing looked the same to me. I remember that this book truly revolutionized the way I look at organizations and their relationship with their employees. It taught me about what generates motivation and how decisions are being made. It’s a must-read for just about anyone interacting with human beings. (Available in Germany, in the US, in the UK, in Italy, and in Spain)

Give & Take by Adam Grant – I have to admit that I didn’t finish reading the book but did read the most of it. The book provides you with a unique perspective about the business world and what is it that we define as “being successful.” I learned that giving to others is a sign of strength rather than weakness. This is because as you provide a win-win situation in your interactions, you help others succeed which later contributes to your own success. (Available in Germany, in the US, in the UK, in Italy, and in Spain)

Lean In by Sheryl Sandberg – It’s a bit of a girl-power cliché but worth mentioning as reading this book has been a milestone in my career. Being the only woman in the room has its price and you don’t always feel comfortable expressing your opinions. This book is a must read for every aspiring young woman. I learned to “sit at the table,” meaning: to participate, metaphorically speaking – to stand in the first row so I am seen, and always make my voice heard. (Available in Germany, in the US, in the UK, in Italy, and in Spain)

As for gadgets – I hate to disappoint the readers of Digitalscouting, but I am not much of a gadget fan. My house has a few TV sets and one old laptop. I live far away from the city in the countryside with my family. I prefer to have my kids climb trees in the backyard and threw pebbles into the stream than play with my mobile phone or an X-Box.

When your job revolves around cutting-edge technology, you seem to lose your appetite for shiny new gadgets. You could say that it’s a way to maintain a good work-life balance.

Karen is a product and innovation expert. She has over ten years of product management experience, leading user experience and data-oriented products, in the hi-tech industry.

About three years ago, she was introduced to the financial world, working with the incumbents to help them leverage technology for the sake of digital transformation, and found out that this is her calling. As part of her mission statement to bring digital transformation to Israel and not just export it, a few months ago Karen joined one of the largest banks in Israel as head of technological innovation.

Cheers to more success to you Karen!

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