Des Moines
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In mid-April, for the final time, Brian Hemesath took the stage at the Des Moines, Iowa, Global Insurance Symposium to kick off the showcase event for the insurtech accelerator he had stewarded for the past five years. The Global Insurance Accelerator had started with just a folding chair and a card table in a dusty office, with companies that didn’t even have logos prepared, had blossomed into a worldwide phenomenon. In the first year, seven insurance companies sponsored the program for six startups; by 2019, those numbers had increased to 13 and ten, respectively. More resources, upgraded facilities, and notable investments and successes have trickled out of the group over its half-decade.

Hemesath decided to step down to ensure that the accelerator never suffered from legacy thinking. That’s how startup culture works, he noted: It’s important to be able to move on to the next thing. “Innovation means embracing risk,” he said. Lastly, Hemesath thanked the regional insurers and municipal authorities for their support. “Des Moines and the midwest are literally on the map now” for innovation, thanks to the insurance industry’s digital transformation, he said. “We’ve leveraged our own natural resource — insurance professionals — to build this reputation.”

A new set of eyes in the personage of Nicole Cook stood ready to take over. Like Hemesath, Cook had left her home state of Iowa to pursue a career in financial technology, starting with the Des Moines-based payments startup Dwolla and eventually moving on to a couple other projects, including time Both she and Hemesath

“I had been a part of a startup that was Des Moines-based, but it was one of the few,” Cook said in an interview, noting that historically, the pressure was on innovators from the region to move out of the area. “Now, startups are saying, ‘I don’t need to leave this ecosystem.’ The support system exists and things like the GIA have started to bring investors to the area.”

The Global Insurance Accelerator is one of the primary examples of how insurtech has carved out a niche to help regional technology growth and innovation in some areas. More than 80 companies that sell insurance in some form — ranging from locally grown notables like The Principal, to major regional offices for companies like MetLife and Nationwide — have a presence in Des Moines, according to the Greater Des Moines partnership. Once the fintech movement moved into insurance, locals who had tried to support more industry-agnostic tech development programs realized that “being more focused and leveraging the insurance industry that was here makes sense,” Cook says.

Now, Des Moines and the state of Iowa have a blueprint for leveraging existing regional strengths into a tech cluster. An agritech accelerator recently launched in the area, with some crossover with insurance but also complementary characteristics. And it isn’t the only city where this is happening.
Hartford
Two days after Hemesath’s sendoff, the Hartford Insurtech Hub held its demo day in the Connecticut city long known as the insurance capital of the world. This was the second class for the accelerator, which was founded by a London company, Startupbootcamp. But despite its overseas origins, the Hub is decidedly Hartford: It’s supported by several locally based insurers, including Travelers, Cigna and The Hartford; and managing director Dawn Leblanc is a Connecticut native.

Illustrating the impact of insurtech on the greater economy of Hartford was the keynote speaker for the event was Glendowlyn L.H. Thames, the executive director of CTNext, a local group that provides support to entrepreneurs in all sectors. By leveraging the region’s strong insurance base and building a digital ecosystem around insurtech, “we are reimagining what Hartford can be and we are leading with our strength,” she said.

The Insurtech Hub isn’t the only program serving the industry. Nassau Re launched its own corporate insurtech accelerator in Hartford in February, and industries ranging from healthcare to manufacturing are opening their own — a similar phenomenon to the downstream effect on agriculture from the GIA in Des Moines.

And with buy-in from local groups, Hartford is at the cusp of a renaissance, Thames concluded: “A quote I use to describe our efforts to move forward for our community is, ‘If you want to go fast, go alone. If you want to go far, go together.’”

Nicquana Howard contributed reporting.
Columbus
By now, the recipe for insurtech success is emerging: Combine a history of insurance in the area with space for new companies to come in and set up shop. Municipalities that see the opportunity are taking notice by tailoring their business environment to encourage insurtechs specifically.

The state of Ohio is particularly focused on insurtech and has passed incentives to support them, says Valentina Isakina, managing director of insurance and financial services for JobsOhio.

“If a company wants to set up her, we have traditional incentive packages around taxes, grants and workforce services,” she says. “But we also to help connect with business partners and stakeholders in the state.”

The “startup studio” Rev1 Ventures has been particularly active in collaborating with Columbus-area insurance companies on this kind of project. The company, which provides both capital and strategic services to help connect startups with larger firms that can benefit from their technology, was a lead partner for State Auto’s launch of a $25 million insurtech investment venture fund in 2017.

More recently, it partnered with another Columbus-based P&C carrier, Grange, on the launch of G-Force Innovations, to help the insurer more effectively identify and work with early-stage companies and emerging technologies.

However, partner insurers aren’t in competition, says Rev1 CEO Tom Walker. Different companies “have their own focus on tech verticals they’re interested in,” he says, adding that encouraging insurtech development for the central Ohio area is a net benefit. “It helps put a bigger spotlight on Columbus.”
Toronto
The Canadian metropolis is a little different from most of the areas on our list, because as a world-leading city the idea that companies would flock there is less foreign of an idea. However, the reasons that the city is an epicenter of insurtech are similar to many of its smaller counterparts.

“If you think about Manulife, Sun Life, Great-Western, there’s just a lot of insurance in the area,” says Roland Chan, founder and CEO of FindBob, a Toronto-based insurtech that went through the Global Insurance Accelerator.

Chan started out as a tech entrepreneur, but dipped into insurance when running an agency. He explains that insurtech wasn’t automatic by any means. What helped it develop at a higher level was that the startup community in Toronto saw that insurers in the region wanted to innovate in their business and had an appetite for trying new things. That spurred more locals to try their hand at the sector.

“There’s a really vibrant startup ecosystem, everything from pre-ideation support to formal accelerators,” he says. “I think we have a vibrant fintech ecosystem, but when we started out there weren’t a lot of insurtechs. Now there’s innovation arms with a lot of these carriers that you can engage with, like RGA’s Cookhouse Lab.”
Twin Cities
The capital region of Minnesota is an up-and-comer for insurtech. There’s a fairly vibrant history of technology and innovation in the region, from companies like 3M and Target. Now, regionally headquartered insurers are making moves to help spur development of an insurtech ecosystem.

“The goal is to build out the fintech community,” says Pooja Shah, managing director of the OnRamp Insurance Accelerator, run by Gener8tor and supported by Allianz and Securian. “It’s surprising that there isn’t one already, given hat it’s a university town with a lot of talent and entrepreneurship.”

A native of nearby Madison, Wisc., Shah came to the accelerator world through QBE Ventures. She says that while there, the “usual suspects” — New York, Boston, London — were the areas of interest. Now, insurtech has “been bringing together these communities.”

“A lot of the companies that start in the midwest had been going to one of the coasts, because that’s where the activity has been,” she continues. “But being away from there and the distractions has advantages as well.”

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