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This Andreessen Horowitz General Partner talks about the tech companies disrupting the centuries-old insurance industryhttps://www.businessinsider.in/miscellaneous/this-andreessen-horowitz-general-partner-talks-about-the-tech-companies-disrupting-the-centuries-old-insurance-industry/slidelist/67017024.cms2018-12-10T00:09:41+05:30

This Andreessen Horowitz General Partner talks about the tech companies disrupting the centuries-old insurance industry

Dec 10, 2018, 00:09 IST

This Andreessen Horowitz General Partner talks about the tech companies disrupting the centuries-old insurance industry

We protect against our losses by sharing our risk, or pooling.

Farmers used to pool their crops at the end of their season. They would choose to give up a higher than average yield in good years, in order to mitigate loss in down years. And this is the fundamental concept behind insurance.

This Andreessen Horowitz General Partner talks about the tech companies disrupting the centuries-old insurance industry

The first insurance market was actually a coffee shop in London. Helmsman would insure the content of their ships before going overseas.

This Andreessen Horowitz General Partner talks about the tech companies disrupting the centuries-old insurance industry

The London Fire wiped out two-thirds of homes in the city and insurance went from a nice-to-have to a must-have.

This Andreessen Horowitz General Partner talks about the tech companies disrupting the centuries-old insurance industry

Acquire customers, underwrite them, and manage claims — these concepts have developed, but have remained relatively the same.

Insurance is a $5 trillion market worldwide.

This Andreessen Horowitz General Partner talks about the tech companies disrupting the centuries-old insurance industry

The government is also behind many other forms of insurance.

These major companies have all been around since before WWII.

Why hasn't there been more incumbents? Starting an insurance company is hard.

This Andreessen Horowitz General Partner talks about the tech companies disrupting the centuries-old insurance industry

But the insurance industry is on its way to changing.

We’ve moved to a world where we can pretty much get anything we want on-demand.

This Andreessen Horowitz General Partner talks about the tech companies disrupting the centuries-old insurance industry

The level of risk has increased so much that it's forcing the industry to react more quickly.

The most exciting story in insurance is a data story.

This Andreessen Horowitz General Partner talks about the tech companies disrupting the centuries-old insurance industry

New insurance companies are targeting niche groups. Next Insurance, for instance, has insurance specifically for yoga instructors.

There are also companies focused on the type of insurance. If you buy a hedgehog, for instance, you might want insurance for your hedgehog from Bought By Many.

This Andreessen Horowitz General Partner talks about the tech companies disrupting the centuries-old insurance industry

If you have a home, you’ve probably had to fill out a form like this with 40-60 questions.

Now with all your home’s information online, a company like Hippo can provide an insurance quote with one question: What’s your address?

Betterview simplifies the underwriting process for commercial insurance with satellite and drone imagery.

Other companies, like Health I.Q., are compiling entirely new sets of data to prove to insurance companies that their population of users are healthier and therefore, should have lower rates.

Until new data sets take off, it is difficult to tell who will have better behavior than others.

Businesses definitely think about insurance.

With new data, insurance will open up more widely to more markets and more people.

Lemonade gives a portion of their profits to causes to cut down on embellished claims.

This Andreessen Horowitz General Partner talks about the tech companies disrupting the centuries-old insurance industry

The types of insurance companies that a16z likes:

Although the industry has grown a lot, the innovation we’ve seen over the last three centuries isn’t going to be nearly as exciting as what happens over the next three decades.

Insurance is going to become more accessible, and risk will be scored at a much more personal level.

This Andreessen Horowitz General Partner talks about the tech companies disrupting the centuries-old insurance industry

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