Asia will be the key pillar in the upcoming revolution of insurance and in all likelihood will become the hottest market for insurance technology (InsurTech) globally. Its no longer just a pipe dream as this time all the stars are aligning for it. Take the sheer population size and rapidly emerging tech-savvy middle class, together with low effectiveness of traditional insurance distribution. Combine it with a destabilizing wave of political populism, making its rounds across much of the developed world and you’ve got most of the ingredients for a region that will take on a leading global role for InsurTech.
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Singapore at the heart of Asia insurance innovation (Photo: Shutterstock)
So what, if anything, is missing to really ignite InsurTech in Asia? It turns out that while the region is ripe for InsurTech, the actual quantity and quality of startups in Asia is nowhere near that of other regions… at least not yet.
Share of investments in insurance startups can be used as a good proxy to the overall level of InsurTech activity around the world. According to the figures, the U.S. takes a lion’s share at 63%, with Germany (6%), UK (5%) and France (3%) making up the distant second at 14%. China (4% - which doesn’t account for Zhong An’s massive investment in 2015) and India (5%) (Source: CB Insights).
So the logical question is then, why aren’t there more startups in Asia, considering the substantial opportunity and funding that exists in the region? Is it due to a shortage of experienced entrepreneurs, difficulty of starting a business, getting access to investment or anything else? The answer is that it’s likely a combination of a few factors, including a weaker early-stage entrepreneurial ecosystem which doesn’t yet effectively support startups and a cultural aspect of lesser tolerance for failure. Both of these are changing fast though and entrepreneurs across Asia are starting to identify and test innovative InsurTech solutions. The following are just few recent notable InsurTech startup examples across Asia that have already reached beyond Series A funding: Zhong An (An $8 billion Chinese InsurTech startup), Connexions Asia (Singaporean Flexible Employee Benefits platform with a US$100 million valuation), and two large insurance aggregators out of India-- Policybazaar and Cover Fox.
via www.forbes.com
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