Insurtech such as AI, virtual assistants, telematics and sophisticated anti-fraud software are all shaking up various sectors of the insurance industry. But two niches remain relatively old fashioned; home and life. There are disruptors active in the home insurance market however and Insurance Edge spoke to Becky Downing and Charlotte Halkett, CEO and MD of Buzzvault.
They have big plans to shake up home contents cover and make it a much more personalised, custom-built experience.
IE: Why does the home contents market need to change?
BD: About five years ago I was burgled and as part of the claims process I had to prove that I owned every item that was taken, provide receipts, get valuations done and so on. After all that I got about half the value of what was stolen. It was a very negative experience and it made me think that in some respects the home insurance market is broken in some ways.
If you move house, as I’ve done recently, you still find that getting insured while you move is another big problem. You are doing all the work, compiling an inventory and estimating its value. It really is time that there was a better way of doing contents cover.
CH: Home contents damage or theft is a classic `pain point’ for the insurance industry. About one in five claims are not paid out and research shows that many people don’t know exactly what is, and isn’t covered, plus they don’t know how to value particular items.
IE: How can this all work better in the future?
BD: Most people have smartphones now, and you can start any policy by using an app that takes photos and video of a property. Everything of value to the homeowner can be photographed and valued remotely and this is how Buzzvault can help householders reach a happier place, where a truly accurate contents policy can be tailored to fit the consumer.
Charlotte joined Buzzvault from Insure The Box and she knows that nearly all disruption within insurance right now is happening because of data; the way we handle customer data is the key to offering the right products and services.
CH: If you look at the typical household claim you can see that every step of the way, from First Notification of Loss (FNOL) to settlement offer, is a cumbersome process and in many ways becomes a low point in the customer’s relationship with their insurer. What we have is something much more efficient, far easier to use and it takes some of that pain away from the customer’s point of view. It’s a kind of digital butler service.
BD: Exactly, Buzzvault is something that proves itself useful at one of the most stressful points in your life.
IE: OK, let me ask you this; how would you value a used Rolex watch, just from a photograph, because values of particular models can vary, plus the condition, service record, box and paperwork etc all make a big difference to the price?
BD: That is a difficult one right now, but all I can say is that we are moving into tech that will offer an accurate valuation of something like watches and jewellery. It is a big issue for many homeowners and I’m sure that the industry will get to a point where we can solve that problem quickly, at the point of policy quote. We are already dealing with long established obstacles like asking householders, almost bizarre questions such as, `how far away is the nearest tree?’ We will get there.
CH: One of the biggest opportunities in home contents is within the rental sector. About half of all renters have no contents cover at all and we think part of the problem is that getting a quote on replacing specific items can be so complicated and time-consuming. The key to winning over tenants is making the process completely transparent and providing accurate values so that people know they are going to receive X pounds if a particular item is damaged or stolen.
BD: Most people tend to under-estimate the cost of replacing their home contents by about 40%, so using tech to identify the true costs, and letting customers choose their level of cover via an easy-to-use app based platform is definitely the way to go. More pre-filled forms, fewer boxes to tick – all adds up to a faster process and people are far less likely to abandon a quote if things run smoothly and rapidly.
IE: Your company won the DIAmond award at the Digital Insurance Agenda event earlier this year, what was that like?
BD: You only have eight minutes to pitch your company, service and mention the key points that make you different, so it’s a tough crowd! But what a great feeling on the night and to win something like this really spurs you on.
CH: Also inspiring to be in a room with another 55 companies, with some real world class start-ups there as well. Loads of interesting ideas, competing views on how the industry should change and which direction we are heading.
BD: The most interesting thing about presenting at the awards event was realising that all this new tech is being used to resolve a very human story; people are upset and vulnerable when their house is flooded, damaged by fire, or burgled. But we have something that can really help make the aftermath a less stressful journey. You do feel proud of what you’ve built when you explain how Buzzvault makes a difference.
CH: People want cover for when the worst happens, and they don’t really care about the techie stuff, they just want everything to kick in and work for them. As an industry we must never lose sight of that.
IE: Thank you for your time, good luck for the future.