Despite encouraging signs in the overall business landscape, P&C insurers are under pressure to transform their value propositions and compete on more than just price. Amid mounting environmental, social, technological, and competitive risks, next-gen data sources and the ability to leverage them are seen as crucial to protecting and growing margins, maximizing efficiencies, and achieving competitive advantage.
Indeed, 92% of P&C insurers believe data-driven insights can help them generate significant improvements in not only pricing, but also client experience, underwriting, and claims management, according to a recent survey from Swiss Re. By the end of 2025, a third of the 181 zettabytes of data generated worldwide will be real-time and captured automatically and inexpensively.
Today, a growing army of insurtechs are making carrier-relevant data available on demand, via API. And advances in AI, generative and otherwise, promise to further help insurers harness a rapidly growing universe of data to improve loss ratios, increase premium growth, and boost retention. Carriers utilizing a modern, cloud-based platform that enables them to operationalize the latest insurtech data and innovations will increasingly put distance between themselves and less nimble rivals.
Yet even while the industry’s adoption of new technologies and data sources over the past five years has been characterized as nothing short of “astounding” by Gallagher Re, hunting down the hottest new insurtechs is far from easy. Despite the fact that insurtech funding remains well below levels seen in 2021, it’s still robust—particularly for late-stage start-ups. Overall, funding grew by nearly $100 million between the third and fourth quarters of 2023, topping $1.1 billion. Roughly 40% of all insurtech funding in Q4 went to mega-round ($100 million+) deals—a six-quarter high. Identifying the most compelling insurtech value propositions before they get locked up (or, judging from those late-stage funding trends, acquired outright) by other insurers will only grow tougher.
It’s a challenge that has become the driving force behind the Guidewire Insurtech Vanguards incubator program, an initiative designed to help P&C insurers quickly gain access to cutting-edge insurtech value propositions as Guidewire scouts for new additions to our industry-leading PartnerConnect program. With that in mind, let’s explore some of the competitive tensions facing the industry—and how some of the additions to our program over the past 12 to 18 months can help insurers rise to the challenge.
IoI: The Internet of (Real-Time) Intel
In truth, data has always been the lifeblood of insurance. But over the next decade, success in this sector will directly correlate with a carrier’s ability to leverage exponential amounts of real-time data from a rapidly expanding array of Internet-connected devices, technologies, and sources. The data piped to carriers via in-car and smartphone-based telematics systems to enable today’s usage-based auto insurance models is just a glimpse of what’s to come.
Increasingly, insurers will need to leverage robust data ecosystems that could include traffic cameras, Internet of Things (IoT) sensors, radar, LiDAR, and (much) more in order to fuel innovative new forms of coverage and streamline the claims journey. Witness the real-time, AI-powered solutions from Nauto. In addition to helping drivers prevent collisions and reduce risky driving behaviors, Nauto automatically records and reports detected collisions and initiates first notice of loss (FNOL) automatically. It also leverages sensor and dashcam video to assist claims handlers, exonerate drivers, and combat wrongful claims.
On the job, MakuSafe offers award-winning IoT solutions that leverage wearable technology to help improve worker health, safety, and productivity while mitigating workplace hazards and exposure to costly workers’ comp claims by 50% or more.
Claims Management: Mastering the Moment of Truth
Nothing’s more crucial to long-term customer loyalty than that ultimate “moment of truth” known as “claims.” But beyond its capacity to enhance or diminish the brand experience in the eyes of insureds, claims are also a carrier’s biggest cost center. And striking the right balance between customer satisfaction and profitability grows more challenging by the day. Think about it: Despite all the technology investments made in recent years, the global combined ratio for the industry continues to creep upward, reaching as high as 103.8% in 2023. That’s up from 98% in 2019.
Insurtech solutions designed to help carriers process large volumes of claims efficiently and optimize the effectiveness of adjusters are key to expediting claims resolution and ensuring positive outcomes. AI will play a central role in all this. Just ask Roots Automation, which provides AI-based “Digital Coworkers” that dynamically ingest, understand, and interact with policy and claims documents, systems, and processes, freeing up adjusters to provide a more concierge level of service. There’s also Claimsforce, which enables insurers, third-party administrators (TPAs), and independent agents to automate smart disposition of claims based on selected parameters, simulate claims scenarios to optimize decision-making, and more.
This is all just for starters, too. Vanguards like SLVRCLD use machine learning (ML) and other technologies to identify contents items, accurately price them, and even point to nearby suppliers carrying them. Digital Owl combines ML with proprietary technologies to analyze thousands of medical records and transform them within 24 hours into a single, focused, actionable summary. Meanwhile, Dawai/KnowRisk leverages AI to process claims documents and generate customized claims correspondence in seconds. And SnapRefund focuses on what insureds care about most: prompt payouts. SnapRefund’s technologies help carriers and agents automate claims payments faster and more accurately while eliminating manual paperwork and other administrative costs. Others, like Clearspeed, boost decision confidence for straight-through processing by quickly flagging fraudulent claims with an accuracy rate of >97%.
Underwriting Innovation: Selecting & Retaining the Right Risks
Achieving a competitive edge in underwriting requires moving beyond traditional risk-segmentation models and underwriting criteria. A one-size-fits-all approach based on overly broad and often outdated data won’t cut it anymore. Savvier insurers increasingly tap ML and predictive analytics fueled by granular data to make better informed decisions about coverage, policy renewal, and pricing—as well as pinpoint the most profitable (or costly) prospects as early as possible. When integrated with a modern insurance platform like Guidewire, this is where Vanguards come in.
By leveraging AI and geospatial data, for instance, True Flood Risk provides API-based intel on 200 million properties worldwide to help carriers understand, price, and mitigate flood risk. Wizard Analytics, on the other hand, offers the world’s first-and-only Excel-native AI and ML scrubber to instantly ensure Schedule of Value (SOV) accuracy. For its part, Pinpoint Predictive, utilizes deep learning (DL) combined with behavioral data and curated intelligence, to help insurers make highly accurate loss predictions—including propensity for litigation—long before underwriting or even quoting begins.
Meanwhile, ForMotiv segments high-intent applicants to focus marketing and outbound efforts on opportunities with the highest chance of closing. Veruna leverages AI and deep learning to help independent agencies identify the best opportunities for leads, referrals, and upsell and cross-sell potential. There’s also swifter.io, which extends carrier policy management systems into new distribution channels with customized quote-and-bind experiences—and Raincoat, which enables new forms of coverage, including parametric insurance products, offered through embedded distribution channels.
For existing policyholders, ReFocus AI uses ML-based statistical modeling to identify those who are most likely to leave, up to six months in advance, so insurers can initiate measures to retain the customer.
Operationalizing Intelligence: Unleashing & Leveraging Trapped Data
Wasting manpower on processing incoming documents and data—or tracking down proprietary data trapped in silos—just won’t cut it when profitability grows harder to come by. Even in the best cases, data in these assets isn’t likely to be rationalized, curated, or contextualized, let alone made actionable.
Many Insurtech Vanguards leverage ML, generative AI, and other technologies to instantly extract meaningful intel from documents or other types of data and make it actionable to CRM, underwriting, and claims teams. In Sixfold’s case, GenAI is leveraged to evaluate submission data and to surface those that best align with a carrier’s unique risk appetite. Eigen Technologies document processing solutions automatically extract document contents and transform them into structured, usable data. Others include Pibit.ai (automated extraction of insights from submission documents such as ACCORD, loss runs, and more), RecordLinker (ML-driven integration of policy records across all systems to identify discrepancies and ensure accuracy), and Quantexa (integrated intelligence that unlocks silos and connects billions of disparate data records to inform faster, more accurate, and fully contextualized underwriting, risk intelligence, and anti-fraud decisions).
The reduction in manual processes enabled by such solutions can be remarkable. Doxci‘s solution, for instance, has been shown to decrease operational expenses by as much as 30%. Not to be outdone, ScaleHub leverages AI to deliver 100% automated document processing for any volume of forms in as little as one hour and at an accuracy rate of more than 99%.
Meanwhile, Paperbox and its AI-based inbox intelligence solution automate email and physical document processing from both physical and digital mailboxes. In the case of Gradient AI and Torch.AI, proprietary data is fused with intel from tens of millions of claims and additional public data sources—social media, geography, and more—to uncover hidden context and correlations through a deeper, ontological understanding of an insurer’s data.
Gaining access to all of these insights is one thing. Making them accessible to everyone who needs them is another. To that end, member start-up InsOps offers low- and no-code solutions for building a Unified Insurance Data Lake as a Service (UIDLaaS), designed to connect insights, and the data behind them, wherever they may be stored. Whether it’s within CRM, ERP, internal, or external systems, InsOp’s combination of cloud data migration, GenAI, and ML makes it all available and usable everywhere it’s needed—at speeds that are 10X faster than any other ingestion solution on the market.
Optimizing Efficiencies Throughout the Extended Ecosystem
Insurtech ecosystems are central to the growing momentum seen in embedded distribution and the $722 billion in gross premiums Deloitte expects it to generate by 2030. Usage-based insurance, automated FNOL, and new forms of parametric coverage are just a few of the other major trends predicated on ecosystems.
But tools for managing specific elements of an insurer’s extended ecosystem of suppliers, agents, and other partners can also drive significant cost savings while giving them the ability to scale up operations and deliver superior customer experiences.
Cases in point include Codafication, which offers an end-to-end, cloud-based project management platform that gives insurers’ teams everything they need to triage and manage subcontractors and direct repair networks in processing property and contents claims. Collaboration is simplified with trackable histories and a single source of truth for all stakeholders. ClaimSafe, on the other hand, focuses on emergency property damage claims, enabling insurers and suppliers to allocate the best possible resources and connecting all stakeholders in a single platform during large-scale CAT events.
Others are focused on specific verticals. Vecto, for instance, connects carriers to a network of car providers to improve and expand the rental replacement during the claims process. Meanwhile, Bifrost unlocks siloed data to consolidate all contract-related information for reinsurance management operations, reducing errors and repetitive manual work to facilitate collaboration between legal, underwriting, claims, accounting and cedent teams.
Then there are payments. Members like Sureti (payment rails from carriers to certified restoration contractors) are indeed at the Vanguard of their respective value propositions as insurers expand the reach of their ecosystem operations.
Claim Disputes & Litigation: Tipping the Scales of Justice With Analytics
While replacement costs have jumped 30% since 2018, inflationary pressures are beginning to ease, at least in terms of construction materials. But even as economic inflation continues to decelerate through 2024, Swiss Re warns that “social inflation”—the tendency for juries to sympathize with plaintiffs in claims disputes that make it to court—remains a concern.
Together with third-party litigation funding, social inflation has helped push the percentage of claims that go into litigation up 30% in just one year, and nearly 50% over the past five. The number of so-called “nuclear” jury awards over $10 million has doubled since 2020. Plaintiffs’ lawyers and consultants also continue to invest heavily in robust data, analytics, and other technologies to identify and exploit liability opportunities as well as to find potential new clients and favorable jury members via social media.
Enter our Insurtech Vanguards. With names like ClaimDeck (data analytics for reducing indemnity, legal spend, and claim life), Optimalex (predictive analytics decision support tools to improve consistency, fairness, and efficiency in claims and dispute resolution), and Charlee.ai (AI-based predictive analytics for litigation and claims management), these ambitious insurtechs are helping insurers tip the scales of justice in their favor.
Other support technologies can also help accelerate dispute and litigation resolutions. Just look at eSumry, which leverages large language models (LLMs) to provide a ChatGPT-style interface that gives litigation examiners and managers easy access to depositions, exhibits, reports, and more.
Purpose-built for auto lines, NoTraffic offers an AI-powered traffic signal platform connected to intelligent sensors to provide detailed mapping of accidents—including vehicles that ran a red light, turned into the wrong lane, and more. Meanwhile, PainWorth calculates bodily injury claims in minutes—decreasing litigation by fostering trust and collaboration with claimants while enabling adjusters to instantly find the most relevant case law for a particular claim.
Simplifying CX: Enhancing Customer Engagement
Efforts to streamline processes and improve the customer experience through digital engagement can work wonders—but only to a certain extent. According to J.D. Power’s 2024 Property Claims Satisfaction Survey, satisfaction levels for claimants using digital channels to manage a claim hit 903 out of 1,000 last year, but only as long as the claim was settled in less than three weeks. Scores fall precipitously when the claim cycle time—the amount of time from reporting a claim to finished repairs—extends beyond that point.
In 2023, the average claim cycle reached 23.9 days, which is six days longer than 2022’s average. During catastrophic (CAT) events, the average stretches to 34.2 days. That’s a problem when lines like personal auto see a growing percentage of policyholders shopping for a new insurer.
The growing frequency and severity of CAT events have also made it difficult to limit customers’ need to contact their insurer with questions. But that’s not all. From making policy changes, to buying more or different coverage, to finding policy docs or paying a bill, J.D. Power suggests that “digital” doesn’t yet always equal “easier.”
Queue Vanguards like Floatbot, a generative AI-powered Conversational AI platform that helps carriers, MGAs, and brokers build self-service chatbots and voicebots, and Modern Metric, which enables carriers to easily collect information and prepare personalized insurance proposals. There’s also Canopy Connect (consumer consent-driven verification of premiums, limits, coverages, deductibles, and declaration pages from all personal and commercial lines in just seconds for a frictionless customer experience) and Yassi (instant access to live, real-time vehicle lien, registration, and title data from state motor vehicle agencies and federal databases for total loss claims management, from FNOL to settlement).
And don’t forget Glovebox, a client experience platform for independent agents that enables policyholders to get quotes quickly and easily, as well as request service and report claims using an automated chatbot. Aerogami, meanwhile, transforms policy documents into a mobile experience capable of providing support and proactively engaging policyholders throughout the claims process.
Others offer API-based integrations for insurers, agents, and others that simplify the front-end user experience in web and mobile channels. For the ultimate in convenience, IB, Inc. offers a solution that helps policyholders manage all the policies they have with multiple insurance companies in a single smartphone app—which could prove critical in the event of a natural catastrophe.
Remote Patrol: Reducing Risk, Optimizing Response
The ability to bypass costly, time-consuming physical inspections through the use of computer vision, smartphone and aerial image capture, and other remote inspection technologies stands to have a massive financial impact for insurers seeking to reduce costs and improve customer satisfaction. One carrier with $200 million in direct written premium recently reported a true run rate savings of over $1.4 million with property intelligence generated with these technologies, for instance.
These same technologies can also help reduce the 10% of P&C losses that result from fraudulent claims. By expediting claims processes overall, they may also prove pivotal to reversing the 7-year low in property claims satisfaction documented by J.D. Power. Homeowners pleased with the claims process are 80% more likely to renew their policies and can contribute to as much as 30% more profitability.
So it shouldn’t be surprising that innovative insurtechs in this space continue to join our Vanguards program. ProxyPics, for example, leverages real-time property photos and video, computer vision, ML, and mobile app technology to provide exterior and interior property condition intel, LiDar-based floor plan scans, and 3D model measurements to quickly and accurately detect potential hazards for underwriting and damage verification for claims.
Hosta a.i., on the other hand, leverages spatial and material analytics to automate on-site property assessments. Carriers, contractors, or property owners can snap images using a camera or mobile device and upload them to the insurer’s cloud platform—no special app required. Configurable APIs enable insurance reps to instantly see detailed structural and spatial measurements, conditions, risks, CAD and 3D models, and even an itemized bill of materials, directly within their established workflows.
Meanwhile, Sync Technologies generates digital twins to give insurers a 3D, virtual reality-based view of properties to simplify everything from site inspection and data collection to scoping and repair work.
These and other insurtech solutions are beneficial to expediting any property claim, let alone the growing number of large-scale claims events stemming from natural catastrophes. In 2023, insured losses from CATs topped $100 billion for the fourth year in a row. According to a new report from Swiss Re, average annual insured losses from CAT events are set to double within the next 10 years.
Vanguards like Salient Predictions and KorrAI could play an increasingly important role in selecting, mitigating, and responding to these particular risks. Salient, for instance, combines novel ocean and land-surface data with machine learning and climate expertise to arm insurers with highly accurate weather forecasts 2 to 52 weeks in advance. Major carriers already tap Salient’s forecasts to proactively inform policyholders of weather-related threats and tips about preventive measures. They can also use Salient data to optimize placement of CAT response teams and other operations in preparation for forecasted large-scale events.
Not to be outdone, KorrAI leverages satellite-based interferometric synthetic aperture radar (InSAR) and AI technology to detect ground motion trends to provide the first global-scale ground motion risk index to inform underwriting decisions. The same intel could one day inform claims and CAT response planning long before a major event.
Commercial Insurance: Unlocking New Opportunities Large and Small
According to KPMG, commercial lines remain buoyant, but signals of change are swirling around this sector. Carriers that focus on reducing legacy systems and harnessing new technologies enabled by a modern insurance platform will be best positioned to thrive in the decade ahead.
A tech refresh won’t do. Leveraging both internal and external data and the rising technological wave to connect and optimize back and front office processes is key. To that end, Insurtech innovation makes it possible to gain a competitive advantage in existing commercial lines while expanding into new ones.
Fortunately, commercial insurance is well represented in our Vanguard member roster, which includes TensorFlight (a neural network-enabled desktop inspection platform for commercial property), Instabase (workflow automation for commercial broker submissions), BlueZoo (foot traffic measurement solutions for identifying, mitigating, selecting, and pricing commercial property risks), and GigEasy (a platform for offering a rent protection benefit for gig economy workers). There’s also Relativity6, which offers API-based tools that predict the 6-digit North American Industry Classification System (NAICS) code for any business so commercial underwriters can confidently quote business, Tbetter detect fraudulent activities or claims, and provide more relevant marketing messages.
Meanwhile, Relay Platform is a desktop solution that helps commercial insurance brokers manage deal flow across an intuitive, user-centric workflow management system and instantly quotable, streamlined access to both digital-first and traditional brokers.
Together with a growing list of regulatory mandates, state laws imposing 12% or more in annual interest for workers’ compensation claims payments not made within 20 days—including those that are taken to court and aren’t resolved for years—can become financially ruinous for insurers. So it’s worth pointing to Vanguards like Atomic, which provides real-world insights from employee and employer data to streamline workers’ compensation processes.
Governance & Regulatory Compliance Made Easier
P&C insurers must comply with an alphabet soup of regulations sporting acronyms like GDPR, CPRA, HIPAA, LGPD, PCI DSS, NIST, and more. Insurtech Vanguards like PrivateAI, Fairly AI, Monitaur, and InsurIQ give carriers the tools they need to meet internal and regulatory mandates and governance issues.
Take solutions like those from Fairly AI, which offers solutions that help insurers implement and document robust governance policies by continuously monitoring AI models to ensure responsible and ethical use of AI. Or the Digital Agent Compliance Platform from InsurIQ, which pares down manual tasks associated with agent onboarding and records management with automated workflows and real-time enforcement of licensing compliance measures. To establish and maintain cross-functional alignment, Monitaur enables data, governance, risk, and compliance teams to design and execute AI governance policies enterprise wide from a centralized platform.
Meanwhile, PrivateAI offers tools designed to manage and protect sensitive data. The company’s AI-powered solution automatically detects and replaces over 50 different types of personally identifiable information (PII) in over 47 languages. Processing data using artificial intelligence helps combine cybersecurity and privacy to keep valuable and applicable data operational while complying with regulations the world over.
Scouting Next-Gen Vanguards Goes Global With Live ‘Pitch Day’ Events
As we continue to identify the hottest, most innovative insurtechs, we’ll surface them to our existing community of customers based on their specific challenges and business goals. Learn more about the Insurtech Vanguards program here. Plus: Catch up on the action in our annual Insurtech Vanguards Pitch Day competition, which just went global with our first events in Sydney, Australia, and Dublin, Ireland—and keep your eyes peeled for this year’s US competition in the coming weeks!
