Top 7 Innovative Insurtech Companies of 2024: Detailed Guide

The insurance industry is heavily investing in digital transformation (see Figure 2) to: 

• Automate regular processes 
• Acquire a competitive advantage 
• Deliver customers a better price and service. 

Though some traditional insurance companies employ in-house models, insurtech firms conduct the majority of the sector’s innovative activities. Therefore, more than 80% of incumbents have invested in or partnered with insurtech firms.  

On the other hand, some insurtech firms attempt to replace incumbents through superior technology by directly selling coverage to customers. Whether disruptive or compliant, the insurtech market is predicted to grow at a rate of more than 50% annually until 2025. Thus, sector executives should explore insurtech businesses’ new solutions that attract investment. Therefore, in this article we present 7 innovative insurtech companies and their implementation of technologies. 

Figure 2: Insurers’ investment areas in 2022.

1. Virtual i Technologies: Underwrite risk precisely and fast

The essential practice of insurance is risk pricing (underwriting). Underwriters have been manually interpreting data to determine risk for generations. However, currently 85% of customers expect fast/instant underwriting and greater availability of data makes manual underwriting useless. Thus, underwriters use AI models, particularly advanced analytics, to speed up the risk scoring process and interpret enormous data 7/24.     

Virtual i Technologies assists insurers and reinsurers with their insurance as a service mentality underwriting platform. Subscribers of their cloud platform can benefit from advanced analytics to quickly calculate risk scores of their customers. Virtual i Technologies’ platform:

• Speeds up and automates the underwriting process.
• Calculates risk more precisely so it helps the risk management practices of insurance companies.
• Reduces human errors  while performing underwriting.

Virtual i Technologies also supports claim adjusters. Their platform offers a secure video streaming channel for users. Thus, the platform makes remote examination of damage and remote filling of the first notice of loss (FNOL) document possible.

2. Etherisc: Transforms claims processing with blockchain 

A traditional claims processing has 5 steps as shown in Figure 3. The primary goal of the initial claim investigation, and policy check steps, is to determine claim’s legitimacy. Each step, however, is time consuming and stressful for insureds, who are not fraudsters mostly and want a resolution following a catastrophic event.

Figure 3: Steps of Claims Processing.

4). For instance, when it rains as much as the milliliter indicated in smart contract, agriculture insurance automatically proceeds to the payment arrangement step, skipping the initial claim investigation and policy check. Because Etherisc has access to rainfall data from a third-party data provider, the data shows that the claim is not fraudulent. 

Figure 4: Automated claims processing of Etherisc.

To learn more about blockchain case studies you can read our 7 Blockchain Case Studies from Different Industries article.
If you think blockchain assists your business, our sortable/filtrable lists might guide you to find the best blockchain platforms and services.

3. Avinew: Utilizing IoT to measure real risk of driving

Another possible insurance area where technology can be effectively utilized is auto insurance. Smart and autonomous vehicles are becoming increasingly popular. Also, many smart gadgets, such as phones, can be interconnected with automobiles. As a result, IoT devices can offer insurers with more detailed information on drivers’ habits and vehicles’ condition since IoT provides instantaneous data flow (see Figure 5).

Figure 5: New data sources available for auto insurers.

Some pioneers, such as Avinew, use IoT to obtain richer data for auto insurance underwriting. In return, Avinew offers lower premiums to drivers and car owners if:

• Car is self-driven (Avinew assesses whether the car is self driven  or not by the help of an AI model).
• Drivers become risk averse (Reduce speed, acceleration, full breaks etc).
• Drivers pick safer routes (In 2019 Avinew acquired Better Drive to measure the risk of the route).

To learn more about how richer data flow from smart devices nudge users to behave better you can read our article on “Internet of behaviors (IoB)”

4. Bdeo: Enhance claims adjustment via AI models

Insurance businesses should have enough liquid assets to cover claims to avoid bankruptcy. Estimating the financial value of “reported but not settled claims” is one technique to effectively manage liquidity risk. 

To estimate insurance companies’ liability, claims adjusters conduct an initial examination of the damage. Nowadays, a range of AI models can enhance claims adjustment.

Bdeo offers a platform for P&C insurance companies that offers different AI capabilities to improve various stages of claims processing as follows:

• A NLP-based chatbot interacts with claimants via the Bdeo mobile app when damage happens. The location of the accident is extracted using the mobile app. Meanwhile, a chatbot instructs clients on how to photograph and videotape the damage and upload it to the system. If the customer’s upload does not meet the quality standards, the chatbot notifies them, and the uploading procedure begins again.
• The Bdeo platform’s computer vision model and claims adjusters remotely inspect uploaded photos and videos. Claims adjusters can investigate more instances through remote investigation. Furthermore, implementing computer vision models reduces the likelihood of damage misvaluation and enhances insurers’ overall claims processing. 

5. Dacadoo: Rewards insureds who have healthy life-style

In the US alone, the health insurance market is valued over a trillion dollars. Thus, it is worth investing in technologies that provide a competitive advantage. Health insurance firms can decrease their liabilities and improve their responsiveness and ESG posture by encouraging clients to live healthier lifestyles. At the same time, they can expand their market share by providing lower-cost services.    

Dacadoo’s digital health engagement platform assists health insurers. Customers’ devices, such as smartphones and watches, are integrated via API. As a result, Dacadoo collects information about people’s habits and provides insurers:

• Real time risk scoring: Assesses mortality and morbidity risk. 
• Loss prevention capability: Behavioral based point system rewards insureds according to their life quality improvements.
• Differentiate product: As we highlighted in our article on the use of digital twins in insurance, insurance is no longer just about compensating for financial losses. Customers want their insurance providers to provide assurance and loss prevention techniques. Dacadoo offers such leverage for health insurance vendors.

6. Celsius Pro: Provides scientific environmental risk management

The climate issue is one of the most significant challenges that businesses face, with 97% of enterprises affected in some way (see Figure 6). Extreme weather conditions, which are 5 times more common than they were 50 years ago, may have an impact on almost half of the businesses’ operations. Companies obtain natural catastrophes (Nat Cat) business insurance plans to protect themselves from the financial consequences of catastrophic weather disasters. More extreme weather events and higher demand for Nat Cat policies resulted in a 17% more loss of Nat Cat related insured items in 2021 compared to 2020.

Figure 6: Percentage of companies that affected specific impact of climate change

Therefore, to avoid insolvency, Nat Cat insurance sellers should have a scientific risk assessment based on environmental risks.  Celsius Pro’s vast data set, and algorithms, objectively quantifies Nat Cat risks.

Celsius Pro:

• Build an in-house data warehouse where data flows from different meteorological stations and enrich the historical dataset each day.
• Implement advanced analytics to interpret the big data and visualize Nat Cat risk.   

7. Lemonade: Introduced D2C insurance

Lemonade is one of the insurtech companies that sells its own coverages (as Etherisc) with its digital technologies rather than supporting incumbents within their digital transformation journey. 

However, rather than selling insurance coverages via brokers or time consuming office environments, Lemonade directly sells its coverages in digital environments only via a custom mobile app (Direct to customer (D2C)). 

Company offers variety of coverages such as:

• Renters’ insurance
• Homeowners’ insurance
• Pet insurance
• Auto insurance

Thanks to the digitized coverage selling, and insurance chatbot, that automates customer interactions, Lemonade provides a faster service compared to many incumbents which apparently boost customer satisfaction. For instance, it is rated almost five stars in the App store.

By checking our sortable/filterable list of top insurance suites, you can find platforms to boost your claims processing, or fraud detection.

You can also check our insurance underwriting platforms list to improve your risk scoring.

If you need further information about insurtech landscape we can help:

This article was drafted by former AIMultiple industry analyst Görkem Gençer.