It’s been a long time since IE magazine talked to André Symes, (below left) Group CEO of Genasys Technologies. The innovative software company has been busy building new partnerships across the UK, South Africa, North America, LatAm and Europe plus opening a new Product and Innovation Campus in Cape Town.
IE; Tell us how Genasys has been evolving over the past year.
AS; You know the biggest change over the last year or so, since we had a major investment in the company, has been freeing up time for me and Craig Olivier (pictured on the right above) (Group CTO) at Genasys and I’d say to any founder or board level member that you cannot overstate the benefits of having really good, experienced people joining you in the boardroom. It gives you so much more time to focus on strategic decision-making and that’s so important.
That’s how we got to the stage where we have a new innovation hub in South Africa and it’s great to invest in more South African talent, plus bring on new thinking to our team and continue to develop new products. Our focus is underpinned by how we scale our business sustainably – how we expand into territories in a controlled manner.
IE; It’s been a long journey over five years since IE met you both pitching in the North of England.
AS; Yes, Craig and I were just thinking back to those days recently. We got slightly lost looking for one office and ended up walking down this country lane, two guys in suits looking like we had just wandered in from a conference or something. But those were great days because you learn so much and as a company we want to keep learning what works, in the real world, as we grow.
Craig is now based in Cape Town and we have hired more staff in South Africa as well as in the UK, so it’s just as exciting a time now as when Genasys first entered the UK insurance scene but in a different way.
IE; Looking at the insurtech scene in general, one thing you notice is that buzzwords all have their time. A few years back it was blockchain, now it’s ChatGPT, what’s your take on it?
AS; All these tech advances need to be subject to a reality check. At Genasys we’re all about looking beyond the hype of tech to evaluate its value and then working to support the insurance industry’s aspirations and translate this into real-world application for businesses. Our view is that we look at the problem we’re trying to solve and look at the menu of technology to use.
That’s going to be the test with ChatGPT; how useful a tool is it for insurance brands? Until insurance businesses start using it properly and at scale, then there’s the danger it’s a bit of a gimmick, but the signs are very promising. For example, ChatGPT can achieve higher accuracy scores in some legal and medical exams compared to human students, it can also offer very accurate medical advice on diagnosis too. What matters is how those features are utilised by insurers in their respective specialty fields.
I mean years ago, nobody ever thought that Deep Blue would beat a grandmaster at chess, but once it happened, there was no more debate, no going back. It’s the same with ChatGPT or AI in general, once the genie is out of the bottle then you have to decide how best to use the new tech.
IE; So it’s much the same with AI; we need to understand its potential uses rather than just use it as a marketing tool?
AS; To some extent right now, AI is just consultancy fodder, and I don’t mean to offend any consultants out there. But it has to become more than just potential. Where we’ve seen AI really succeed in insurance so far is where it sets out to solve a specific industry problem, known as Narrow AI, such as fraud detection.
Yes, there’s plenty of chat across the sector about AI’s power to price risk right now, and that’s a given in some respects because it can take a stack of data and predict a certain level of claims, then cost per claim on average and so on.
But think about AI’s power in terms of improving the customer experience overall. I’m currently not seeing or reading much about that, but it’s so important. If an AI chatbot can truly understand human questions and resolve problems, then think about the long term impact of that admin breakthrough. Customers who are happy stay loyal, they return to buy new stuff.
The thing is sometimes you just need one piece of customer ID and it opens the doors in so many ways. For example, Genasys recently did a demo where we took a photo driving licence as ID, then a chatbot could talk in any language to the customer, offer new products, price on a quote and buy basis and so on.
All we did was take tech from different systems to make that happen and it baffles me why big tech doesn’t leverage the same tech to get the best from AI. In theory, you could use AI to eliminate some types of insurance completely for a customer, as you could calculate that risk as being so remote, millions to one. But the flip side is that you can also use AI to figure out what each customer does need, where the real risks are. For me that is the real value; it enhances the customer experience by making it personal.
IE; Thinking then about the customer experience and how it can be improved, what are your views on wildfire risks and the use of real-time data as a means for insurance brands to understand their exposure and offer new ways to reduce claims?
AS; Let’s take a step back here. The ideal outcome is for policyholders to experience a quick, seamless claims process in their hour of need and to then receive a fair price for their premium at renewal. It’s a balancing act for insurers yet crucial to consumer trust that policyholders aren’t unfairly penalised by events, such as wildfires, which can very often be outside anyone’s control. So without doubt, accessing real-time data is critical if insurers and reinsurers are to accurately identify their catastrophic risk and exposure and then price accordingly.
We’re working with our Genasys clients to help shift the dial towards a far more positive public perception of the value of insurance. This means looking at how we can change the way insurance is done: how can we put the end-customer first while providing insurers with the ability to flex and deliver fast in any situation. We believe that insurance businesses can achieve this through smart decisions about their core tech. By this we mean using a single core platform which everything can connect to, and evolve and innovate as needed, complemented by an API-first approach.
A well-designed, API-first technology approach enables insurance businesses to access real-time data, to drill down to review management information and geo-plot the risk. This geo-specific information can then be overlaid with additional third-party information such as the weather and fire risks to really understand the level of exposure. This is super useful if businesses want to encourage positive policyholder behaviour change such as implementing climate-related or other useful adaptations to their property.
By taking an API-first approach to data-sharing, insurance businesses can better understand risks in real-time rather than doing retrospective and at times hugely out-of-date corrections as part of their catastrophe modelling – and believe me it happens! It means that you and your customer experience the benefits: you’re able to meet, even exceed, customer expectation while protecting the company’s bottom line.
IE; What are your thoughts on M&A activity, now that the venture capital supply is a bit tighter than pre-pandemic?
AS; It’s a good thing in many ways that investment isn’t so easy to come by now. In the past lots of cash was essentially funding a land grab, as companies were buying bases – customer bases and databases alike. Then they were sitting back after the deal was done and wondering, okay, what do we do now with all these customers?
In the future we will probably see fewer deals, but the companies involved will have a plan in place, to get more value from the customer base. Some of the big tech companies have shown that you can still run a business with a significant reduction in the size of the previous workforce, so there is a lesson there for many companies; ask hard questions about the value inside the company that you’re buying.
IE; Do you think that in the past some of the investment in M&A and Series A-D rounds was actually used to groom brands for an exit, a cash out proposition?
AS; This is probably not a popular thing to say, but yes, that was the case in the past, there was too much focus on the exit strategy, rather than the growth strategy. Because to grow, you need to put the customer first, not the shareholders.
IE; It still baffles IE mag that the motor market essentially has two binary options; Comp or TPFT in a market where renting is replacing owning a vehicle and commuting is almost finished for millions of office based workers. Do you think new investors can finally transform that old 1970s insurance mindset?
AS; There’s an argument that mandatory motor insurance creates less of an incentive for insurance businesses to innovate and offer new products, such as flexible policies which you can switch on and off, that define the real day-to-day risks policyholders’ experience in our post-pandemic world. But with the right technology platform in place now to help you innovate for today, tomorrow and the future then this is completely possible.
At Genasys we’re seeing insurance businesses who really want to step up and think about how they can make insurance much easier for the public to access which is so encouraging for us as our ethos is all about how can we make change the consumer view of insurance through great technology.
You know five years ago Genasys built a car insurance product that you could upgrade and downgrade via an app, depending on temp cover on other vehicles, named drivers, passenger, contents within the vehicle, monthly/annual mileage – the lot. But legacy platforms like comparison sites find it harder to cope with such innovative offerings for the consumer.
Innovation isn’t a ‘nice to have’ as technology and the consumer landscape are moving faster than ever before and stagnating in a changing world means regressing. In our view, until the organisational mindset of an insurance business evolves to embrace innovation then nothing fundamentally changes. But in theory, the industry could use AI, ChatGPT apps and more to revolutionise motor insurance from the ground up. It’s there, all the tech tools are here, insurance business just have to join them together and to start thinking and acting proactively.
IE; Fascinating to visualise the future André, thanks for your time.
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