It is our mission to scout different insurtech, fintech and tech ecosystems asking experts to share their latest updates and expertise. We are happy to collect new strategies, use cases and lesson learned from different communities that we are hoping delivers value whether you're from insurance, finance, tech, and other industries.
What are the things people need to know about the insurance market and the insurtech community in India?
The Indian insurtech market is one of the most attractive opportunities in the world. Insurance is a large, 60 billion USD industry growing at 20% each year, with significant under-penetration and technology currently playing a basic role. It is necessary for companies like SecureNow to develop products and distribution that significantly enhance penetration. The companies that need insurance the most today do not have access.
The insurtech community is growing fast but not fast enough in my view. Firms understand either technology or insurance whereas we need companies that understand both. That’s when the full insurtech potential can be met. I think this will change over the next few years.
What kind of developments did you see in the last 3 years?
The B2C market has expanded tremendously. Insurers themselves sell between 5 to 10% of their total insurances online and there are some web aggregators and online brokers that have built relatively large businesses. The regulations also facilitate insurtech. For example, the insurance regulator (IRDAI) has introduced guidelines for internet platforms, established online sales protocols and is about to introduce a regulatory sandbox that allows companies to experiment.
The way I see the situation in insurance, there are small businesses that understand their risk and are actively looking for solutions, insurers that have a set of products which can be tailored to small corporates, but the distribution pipes are missing.
Now, I would love to know more about your company Securenow.
In the early years of SecureNow we evaluated both retail (B2C) and commercial (B2B) businesses. Soon, though, we realised that our skills are best suited to the B2B business and that is what we have focussed on. Even within the large B2B segment our focus is on small enterprises that are hard to reach. We have steadily introduced new products for this segment. The process of making these products user friendly and easy to buy is time consuming. The challenge is that each client or risk is priced differently. However, through use of technology, we have now made it possible to buy workman compensation, office insurance and many others immediately. On many other products we can issue terms instantly even though actual placement may be offline. You can see some of this in action on www.securenow.in
The first few years we were bootstrapped but over the past three years have raised investment of US$ 7 million. This has helped us build robust technology and scale the business materially. Three years ago, we used to acquire 10 clients a month, today we get 30 a day. To manage such rapid growth requires us to build a strong product placement, claims and operations backbone and that is what we are busy doing.
What kind of partners and customers are you looking for?
Our typical client is a micro, small or medium enterprise. We define this as being less than 100 people or with a turnover of less than 1 million USD. In fact, micro clients are fewer than 20 people. This is an under-served but difficult customer base to get to. Many speak about the business opportunity here but few have managed to successfully build distribution. Our strength is in this area.
We are also actively looking for partners with whom we can integrate our products. Our requirement is that the partner must have a captive client base where commercial insurance fulfills a distinct need. Non-Banking Financial Companies looking for a group credit shield that repays the loan if a borrower dies is one example. In some such integrations, we have been able to get attachment rates as high as 90% of loans.
How do you see the role of the customer and how do you react to it?
Customers are extremely demanding. In the segment that we operate in, they are exceedingly conscious of value. This is good because we are stretched to establish high-quality processes and make sure that the insurance we place is top notch. If we do a good job in serving customers the benefits to us are significant. We have several clients that bought their first small insurances from us, perhaps a premium of US$ 1000 to 2000. Over a few years, this premium has grown to over US$ 50,000. This is a big benefit of listening to our clients and acting on their feedback. As they grow so do we. Not only do we benefit from their growth in the core insurances that they buy but we can also increase the diversity of risks we mitigate through insurance, a complex way of saying we can cross-sell insurance!
Please share some do's and don'ts in building a new company.
The important aspect is to keep an open mind on the business plans that will work. This is often not clear when you start out but should become crystal clear early enough. Building and retaining a team is important because institutional history matters. There are mistakes that we have made over the years and it’s best not to repeat those.
A difficult transition is from the early days of doing everything oneself to having a team and delegating. Without such delegation and empowerment of teams, it is difficult to grow. There has to be an attitude of finding an easier way to do things, of making changes that have a dramatic impact on efficiency. For us, the first such change was the ability to place insurances in minutes compared to previous timelines of days and weeks.
What piece of advice can you share young people and startups who want to enter the fast-spinning world of Insurtech and Fintech?
Building insurance domain knowledge is an essential part of building an insurtech. Technology capability is important but not the only thing that matters. Also, I would advise that you stay with one company for long, particularly if you are a good performer. The possibility of growth is extremely high in start-ups and I find that the best performers typically handle much more responsibility than what they would have in a larger, more conventional company. Building a career is about building capabilities rather than getting a slightly higher pay increase. Do the right things and success will follow.
To give a short personal impression: let us know what are your top 3 books everyone today needs to read?
Reading anything in itself is an invaluable habit. I read on my Kindle several times a day, on my way to work and back and then at home. My favourite books change often but my favourite authors have to be Neil Gaiman, Ruskin Bond, Oliver Sacks and Dr. Atul Gawande. I am not a great fan of business books but for people looking for inspiration I think the best stories are,
- “The Wright Brothers” by David McCullough, (available in Germany, in the US, in the UK, in Italy, and in Spain)
- “Personal History” by Katherine Graham, (available in Germany, in the US, in the UK, in Italy, and in Spain)
- and the story of Shackleton in “Forged in Crisis” by Nancy Koehn (available in Germany, in the US, in the UK, in Italy, and in Spain).
The common theme across these books is the necessity for entrepreneurs to pursue something without success being assured and of how to make the best of a difficult situation.
SecureNow is a tech-enabled insurance broking firm operating in India. It bridges a vital gap by distributing pure-risk, commercial insurances to micro, small and medium enterprises, that do not have access to quality insurances. SecureNow is able to distribute commercial insurances in a sustainable manner by effective use of technology and cuts down the purchase cycle of 2 to 3 weeks to under a day. It is a full-service firm that provides strong technology-enabled claims and service support. SecureNow has over 15,000 clients and acquires over 30 new each day.
For Kapil and SecureNow - a big thanks and more success from all of us here in Digitalscouting. We're hoping we can visit your HQ in New Delhi to the soonest.
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