28 The InsurTech ecosystem is still focussed on collaboration and insurers are increasingly looking outwards to innovate Last year’s report argued that collaboration will be the key to unlocking val- That said, while insurance is sometimes singled out for lacking an inno- ue. If anything, this view has strengthened over the past year with InsurTechs vative spirit, recent research found 67% of industry leaders see creativity continuing to see themselves as enablers rather than disruptors and the and innovation as very important to their organisations, ahead of other number of full stack InsurTech solutions still very low. financial services businesses.9 And examples such as that of Lloyds Banking Group show clearly how insurers are being increasingly creative in their The value that collaboration can deliver is seen in the example of NuvaLaw, interactions with start-ups, seeing them not as individual point solutions from Startupbootcamp InsurTech’s 2017 cohort, a platform that brings in- but seeing how they could combine to create even more powerful propo- surers together with a number of tools, processes and services to reduce sitions. the time and cost involved in settling claims. NuvaLaw is designing a new process to handle inter-insurer motor damage and personal injury claims; For example, Derek Smith, Head of Insurance Innovation at Lloyds Banking its online dispute resolution service, which employs AI and platform tech- Group notes that “partnering with Startupbootcamp InsurTech has helped nologies, has the potential to deliver a 40% reduction in costs and capital us gain access to new technology, business models and emerging custom- outlays, and resolves claims at four times the speed of court-based set- er needs. Teams from across our division are now running multiple PoCs tlements. If insurers work together through solutions such as NuvaLaw’s with companies from the cohorts and events run by the team. there is huge value to be created. As an example, the General Insurance and Innovation teams are partnering Insurers increasingly recognise the opportunity that InsurTech presents with three of Startupbootcamp’s companies to build and live test future them and are looking outwards to innovate. In 2016, just 28% of insurers home insurance propositions that address customers’ needs of tomorrow 7 surveyed had begun exploring partnerships with InsurTechs. By 2017, 45% by proactively reducing physical and cyber risks in the home.” said they were directly engaging. Other insurers have work to do, however, with a further 42% of the firms surveyed conceding they are not even mon- Still, despite such examples, insurers must be prepared to put their money 8 where their mouths are: PwC’s 2017 FinTech survey found that while finan- itoring the InsurTech space. cial services companies plan to spend an average of 15% of annual turnover on their technology programs, the figure for insurers is only 7%. 7 PwC, FinTech Survey, 2016 • 8 PwC, FinTech Survey, 2017 • 9 PwC, CEO Survey, 2017