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Are You Ready for the Future of Insurance?

Rob Galbraith gave our company the best present for Christmas 2019: his book, "The End of Insurance as We Know It." Inside, he wrote an inspiring message "To Małgorzata, Best wishes on your tremendous efforts to shape the future of insurance and bring about a safer world." Roberto received the same hand-written message in his book, of course. Roberto and I teamed up to discuss Rob's book and how new technology is transforming the insurance industry.

I rarely read books cover to cover, but I got so inspired by Rob's personal story in the introduction that I had to read it in its entirety. It was definitely worth it! What a fascinating journey through the present and future insurance trends, explaining where technology is taking the P&C industry in the 21st century. It helped me understand insurance and its transformation spurred by rapid technological advancements.

The book is comprised of 4 parts:

  1. Flaws of P&C insurance
  2. Why conquering the insurance sector remains elusive
  3. How Insurtechs can re-mix insurance as a digital risk transfer model
  4. Thoughts on the road ahead

Parts 3 and 4 are the most relevant to our business, and these are the topics I would like to focus on here.

Rob GalbraithInfluence of Insurtechs

Rob states that insurance is an ideal digital product. It seems perfect for insurtechs to disrupt, but the barrier for entry is quite high. "If you can't beat them, join them," says one of his chapter titles. Indeed, as an insurtech, you have the choice to cooperate or to compete. The "Peace and Love" model of insurtechs cooperating with traditional insurance companies has its attractive side, but a successful partnership can be a long-distance target and quite a feat for a startup.

Most relevant and thought-provoking were chapters 15 "Intelligence Squared" and 16 "Stop and Go: The Case for and Against Telematics" because they speak directly to the value proposition our company is bringing to insurers. They both discuss the complexities of the newest technologies and how they can interface with, transform, and power up insurance.

Thoughts on the Future of Insurance

Rob's views on the future in the last section of the book are truly thought-provoking. Highlighted in this blog are the ones which are most relevant to commercial trucking companies and their insurers. We agree that it is AI that could most likely revolutionize insurance, including computer vision for image processing and NLP for text and voice data. Indeed, the right mix of both can lead to brilliant human-centric applications.

Rob talks about three uses/benefits of AI for insurers and technologies that have the most potential to disrupt P&C insurance:

  1. Leveraging existing data sources to gain new insights via supervised and unsupervised learning to identify patterns and trends.
  2. Ability to make use of data that is acquired but not fully utilized. Gaining insights from unstructured data – text, voice, images - can come in handy here.
  3. Making sense of the explosion of sensor data. Here we see crash avoidance technologies like "dreyev" with a big potential for eliminating preventable crashes. Through continual learning, we can enable personalized use cases for driver training and improving driver behavior.

Market Disruption

Rob talks about the "uberization" of insurance and why it has not happened yet. “Uberization” of insurance may not be here, but we do see the "uberization" of trucking on the rise, where monitoring and micro-coaching in real-time will make a big difference. We wonder how would that would impact commercial insurance?

In the chapter "Back to the Future," Rob mentions further market disruptions in the near future.

  1. A fundamentally new way to price and underwrite risk, upending the traditional approach of using proxy variables like age and gender. I agree, insurers need to start analyzing raw sensor data on excessive speed, hard braking events, and other driver behaviors, such as distracted and drowsy driving patterns.
  2. A transformation of the current highly reactive insurance model by sensor-generated data (reactive to losses after they occur) to one that is more proactive and preventing losses before they occur. This is clearly the way to go! What is the point in spending time and resources in analyzing crashes, determining their costs and paying for them, if they can be prevented?
  3. Ridesharing – the biggest source of liability for companies is the driver. Who insures the driver while the passenger is not there? Those vehicles are on the road much longer, and therefore chances of them getting into a crash are much higher.

Sitting around a lunch table three years ago, we had a fascinating discussion about the far-reaching consequences of algorithmically improving overall driver behavior on the road. In the age of distraction and driver complacency caused by all the surrounding technology, driver attentiveness algorithms can compensate for that and truly help us stay safe on the road.

Gamification can further encourage better driving behaviors. It's simply behavioral psychology. Imagine if insurers could encourage better driver behavior at scale. They could then shape the loss performance of their auto insurance books!

Another question which Rob asks is whether insurance is becoming less relevant as crash avoidance technology radically reduces losses. Not sure what that would really mean to insurers; yet, one thing is for certain: change is definitely coming to the insurance industry.

Overall, the book does a stellar job in bringing the insurance perspective closer to a layperson. It includes a solid introduction to insurance and is probably the best Insurance 101 for all levels.

It is both engaging and highly informative – a hard combination for a book on insurance, one may think. Plenty of statistics and examples help one understand concepts in Insurance Innovation.  Subtitles inside the chapters are pretty ingenious and thought-provoking, some reminiscent of song lyrics, e.g., "You've Gotta Have (Bad) Faith "… and "The Sky is Not the Limit." We would highly recommend this book to anyone curious about the future of insurance, future of technology and the future of all of us! It's a great compendium of future insights, as seen through the insurance lens.


Many thanks to the author - The Most Interesting Man in Insurance! (named by Nick Lamprelli) – a title that is well-fitting and well-deserved.

Armed with the insights from Rob's book, we will now be able to translate his concepts and extend them into commercial insurance scenarios and deal structures we are currently working on.

Greetings from the "Bold and the Brave"!
Maggie and Roberto

Maggie Stys
Maggie Stys
Dr. Styś co-founded dreyev with CTO Roberto Sicconi in 2016 to solve the challenges of distracted driving faced by commercial fleet owners. 

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