A recent report published by Ernst & Young LLP (EY) – an assurance, tax, transaction and advisory services company – and InsurTechNZ – a not-for-profit division of FinTechNZ – has highlighted that insurtechs in New Zealand are having to form partnerships with other startups, or else plan overseas expansion due to the apathetic reception of local insurers.
The report, InsurTech Emerging at Pace, revealed that although 72 per cent of surveyed New Zealand insurtechs said they were already working with an established insurer, broker or services provider, 63 per cent said there currently wasn’t enough collaboration between incumbents and insurtechs to successfully transform the ecosystem.
Dr Graeme Horne, Advisory Partner, EY, argued that the insurance sector has ‘yet to embrace digital advancement at a comparable pace to other industries such as banking and retail’ and as such, there can be a ‘disconnect between the level of service currently being offered by insurers and customers’ expectations’. “In this environment,” he explained, “New Zealand insurers have a significant opportunity to embrace the benefits of insurtech to help them deliver better customer experience and value. However, in order to achieve this, there is a need for increased collaboration between incumbents and new entrants.”
The report showed that the main barriers cited by incumbent insurers, brokers and other established providers included differences in organisational culture, ability to scale, compatibility of technology systems and data security.
Jason Roberts, Chair of InsurTechNZ, explained that ‘increased collaboration will benefit the entire ecosystem’ and that the next step is for incumbent insurers and insurtechs to bridge the gap and explore a ‘by New Zealand, made for New Zealand’ sector-wide opportunity.
Read the full report from EY and InsurTechNZ here.