Approaching Vendor Partnerships for InsureTechs

Last month, Novarica hosted a panel of IT services company executives who discussed what they’re looking for in startup partnerships. Cognizant’s Craig Weber, Salesforce’s Raja Singh, and EY’s Bob Reveal discussed their approaches to building an InsureTech ecosystem and putting startups in front of insurers. Some key takeaways from the discussion include:

Breaking Through the Noise

Conferences were a huge source of interaction and collaboration pre-pandemic. Now, most communication occurs via email and virtual conferences, which can make it difficult for startups to know how to approach a potential partner. All of our panelists agreed that reaching out directly to vendors is a sound approach in this virtual era. Many vendors have teams that evaluate InsureTech, which can help startups get in the door.

So how can a startup make sure its message doesn’t get caught in a spam filter? Craig pointed out that startups should not treat pitching a relationship with an IT services company like pitching a VC for funding. Startups should have clear positioning around value. It’s important to remember that the technology itself is not the selling point; communicating business value and articulating use cases will be the real differentiators.

Integrating With an Insurer

Many IT services vendors curate and pre-vet a network of InsureTechs that they bring to an insurer. This ecosystem approach makes integration flexibility key. Most startups have messaging around their integration capabilities and API strategy. The integration story looks slightly different for core versus point systems, but startups focused on either area should consider the same realities around system complexity and legacy platforms.

Raja pointed out that the right messaging around “wrapping” rather than “ripping” for startup core adjacent vendors can put insurers at ease. As Raja pointed out, many insurers will be hesitant to rip and replace legacy systems, especially if they’re under ten years old. Positioning for point systems might need to take existing core system vendors into account and focus more on wrapping. Many IT services companies, like EY and Cognizant, have integration relationships with these vendors and may be looking for solutions to supplement them. These vendors will also need a flexible integration plan; as Raja pointed out, a clean RESTful API can help a startup stand out.

Sought-After Technologies

Our panelists agreed that technologies surrounding automation are an emerging focus area for vendors and insurers. Technologies that can balance automation and human intervention are of growing interest; Craig specifically mentioned AI technologies that can bring human intuition and emotion into a process. Core vendors also influence the types of solutions an IT services vendor might seek out in areas like document ingestion or claims.

Bob pointed out that technological needs will differ between life/annuity and property/casualty. Property/casualty insurer core system replacement is continuing but has largely stabilized and is slightly more predictable. Life/annuity insurers are just entering this critical inflection point, and their approach to modernization may vary and dictate different InsureTech and technological needs. Approaches to core modernization and improving digital processes will be key areas to watch in this sector.

Novarica hosts monthly interactive town halls for InsureTechs where we discuss challenges and opportunities in the insurance industry. We hope to see you virtually at our May Town Hall next week.

Novarica also helps insurers and established vendors better understand opportunities in the InsureTech landscape. Be sure to check out our annual InsureTech industry report in which we profile 250 startups. And don’t hesitate to reach out to me at  or Research Director Stephanie Dalwin at  if you’re interested in learning more.

Add new comment

CAPTCHA
This question is for testing whether or not you are a human visitor and to prevent automated spam submissions.
12 + 3 =
Solve this simple math problem and enter the result. E.g. for 1+3, enter 4.

How can we help?

If you have a question specific to your industry, speak with an expert.  Call us today to learn about the benefits of becoming a client.

Talk to an Expert

Receive email updates relevant to you.  Subscribe to entire practices or to selected topics within
practices.

Get Email Updates