The insurance industry, known more for its risk-averse profile than its appetite for disruption, has begun to fundamentally shape-shift over the past decade. A great deal of that change has come thanks to insurtech startups that are changing the game by bringing new technologies to the industry.

However, as in other technology sectors, as well as the insurance industry itself, the statistics around women leaders in the insurtech space are underwhelming. A recent study of 535 insurtech companies worldwide by Eva Genzmer of the German insurtech Friendsurance found that just 4% — 20 in total — were founded by women.

“Insurance isn’t different than any heavily male-dominated industry,” says Snejina Zacharia, founder of the AI-based distribution insurtech Insurify. “What’s key is that successful young women who have raised money have to be true to themselves. They can be more successful because of their ability to be more intuitive with the way they run their business, build products and improve the customer experience.”

Zacharia became interested in the insurance industry while trying to manage a claim for a minor auto accident in her last year at MIT. “I was shocked how fragmented and disjointed the car insurance customer experience is,” she explains. “I spent hours talking to different agents, filling out online forms, and answering the same questions over and over. I felt the user should be able to make decisions on their own based on data they provide.”

Many insurtechs are, like Insurify, focused on the customer experience, says Karlyn Carnahan, who leads the P&C insurance practice for Celent. “There are startups focusing on distribution, analytics or operational

services; the insurers who are increasingly partnering with the startups; and the investors, including insurers, who see the potential to make a lot of money in this space,” she says.

The reason insurtech has moved front and center is because as a vertical, the industry is ripe for change, adds Donna Peeples, a Digital Insurance Women in Insurance Leadership honoree in 2014, when she was chief customer officer for AIG. She agrees that insurtech is pushing the industry’s customer interaction forward.

Now, she is chief customer officer at Pypestream, a customer messaging startup that counts insurance as one of its major industries, putting her on the ground for the insurtech revolution. Peeples often represents Pypestream at major insurtech events, with her industry experience adding credibility to the company’s message.

“End users are demanding better service, more consistency and increased transparency in companies they do business with,” she says. “In their minds, Amazon makes it easy, why shouldn’t my insurance company?”

Though Peeples agrees the numbers for women in insurtech are “dismal,” she believes that doesn’t mean that women should be afraid to throw their hats in the ring. Insurtech is driving industry changes that represent significant opportunities for all entrepreneurs, she says.

“I think about my two daughters and how I want them to grow up to be fearless and not be afraid to expand their platform, take on more responsibility and deliver results,” she says. “It’s exciting and an honor to be a part of what is happening, with the possibilities to make people’s lives better.”

Carnahan agrees. For innovators in the insurtech space, insurance has a great deal of market potential if the current model can be disrupted, and those who provide services for insurers have the ability to impact a large market, she explains. In addition, insurance lends itself to creative uses of technology as the product is generally data-based and services can often be distributed through technology. “We don’t have parts that need to ship,” she says.

Like any startup, however, the biggest challenge is speed to market — getting revenue before running out of runway. Insurance carriers traditionally have a very slow sales cycle and don’t usually make fast decisions, while there are often issues getting new technologies integrated with existing application architecture.

The other challenge is the culture of many insurance companies, in which carriers are more comfortable with traditional processes and are more likely to use new technologies after they’ve been proven.

“Insurtechs that are most likely to be successful are those that understand insurance and are able to articulate a message about the true benefits that will accrue to a carrier; those that have a process that allows a carrier to quickly test with little investment; and those that have clear proof points about the benefits,” Carnahan says.

So while women — and men, for that matter — who tackle the insurtech sector must have a great idea, there’s also a human side to the story. Patience and empathy are key to building successful businesses.

“A lot of people might read about overnight success stories in TechCrunch, but a lot of companies don’t make it, or it takes 15 years before it’s a profitable business,” says Jennifer Fitzgerald, co-founder of the online life insurance broker PolicyGenius. “You have to make sure you have a good support network.”

FACES OF CHANGE

Those women who have launched insurtechs to date share a common thread: a desire to make the insurance industry work better for policyholders by leveraging the range of digital technologies, from mobile to AI to big data from multiple sources. Digital Insurance asked three of them to talk about what drew them to the industry, why their solution is going to help and what they would tell other women who want to break into the sector.

KATE STILLWELL
Founder and CEO, Jumpstart
Company Founded: 2015

Q: Can you talk about the idea and the goals behind Jumpstart?

Stillwell: As the first company to offer parametric earthquake coverage, Jumpstart pays customers based on the shaking intensity of an earthquake in their area, as reported by the United States Geological Survey (USGS). Our goal is to get 50 times more money into the system than the status quo, creating an upward spiral of recovery rather than the downward economic spiral that often follows natural disasters.

Over my 20 years as a structural engineer designing buildings to stay safe in an earthquake, I had come to realize that a robust infrastructure is certainly necessary for a community to recover — but that alone isn’t sufficient. Despite calculations that a magnitude 6.7 quake, or larger, will strike in the next 30 years, just one in nine Californians has earthquake insurance. And the reason is that they are understandably discouraged by the high cost and complications of traditional earthquake coverage.

Q: What’s attractive about the insurance business for a tech entrepreneur?

Stillwell: We’re at the cusp of a renaissance. There’s loads of implicit knowledge and informational asymmetry that’s just asking for greater transparency. The parametric approach in particular is a cornerstone of the insurtech revolution, along with unbundling and on-demand coverage.

Even more exciting to me is the opportunity to crack a market, such as that for California earthquake insurance, which until now has been an unsolvable puzzle. We’re out to discover the secret to exploding this untapped demand.

Q: What advice would you give women who want to enter the insurtech sector?

Stillwell: There are plenty of women in insurance, just not a lot in leadership. Because I’m a structural engineer — where it’s about 80% men — by trade, I’m not a stranger to a male-dominated profession, but by comparison the tech scene has been a total shock. I’ll leave it at that without adding any more to the recent chatter on this topic. My advice is that no matter if you’re an employee in an insurance organization or you’re venturing out to start your own business, you need to build coalitions with each other. Use your network of like-minded, strong, empowered businesswomen to band together. Yes, enter the fight, but on your own terms, using feminine strengths like conviction, intuition and relentless execution.

Q: What keeps you inspired by and curious about the insurtech space and this era of insurance industry innovation?

Stillwell: I feel really privileged to be part of the re-imagination that’s happening in this centuries-old industry. The ubiquity of data is creating informational parity that levels the playing field between consumers and risk-bearers — which, in turn, lubricates the market, like eBay did for specialty items like antiques. Ultimately, this is good for consumers because it leads to both lower prices and hyper-customization of product availability. But it’s also good for insurers because it can dramatically grow demand. Also, I’m totally inspired to create a startup that has a moral mission. Insurance is an honorable profession, after all: It exists to deploy money to people when they most need it. It feels good to be making sure we can make good on that.

SNEJINA ZACHARIA
Founder and CEO, Insurify
Company founded: 2013

Snejina Zacharia

Q: What’s attractive about the insurance business for a tech entrepreneur?

Zacharia: In terms of customer experience, the industry is worse off than travel was 17 years ago. Since then, the travel industry has transformed but insurance hasn’t.

My argument is that it’s ripe for disruption now because the tools are better and the technology is more advanced. Carriers are also maturing to the idea that they need to address what customers want. What attracted me is that what people see as obstacles — the fragmented distribution, the lack of full visibility of the value chain — I see as an opportunity for a fresh outside perspective about what best practices could work from other industries.

Q: What keeps you inspired by and curious about the insurtech space and this era of insurance industry innovation?

Zacharia: What excites me is that it’s almost a [level] playing field. Everyone is relatively small and can make a major impact. This is a very risk-averse industry, which is unfortunately dependent on old-school technologies that organizations have spent millions of dollars on. But I can also see the evolution within the insurance industry, how they are becoming more open and curious in embracing new technologies.

JENNIFER FITZGERALD
Founder and CEO, PolicyGenius
Company Founded: 2014

Q: Can you talk about the idea for PolicyGenuis and some of the goals you have for the company?
Fitzgerald: PolicyGenius is an online insurance brokerage that makes it easier to compare insurance quotes, and then apply and buy policies. I was an associate principal at McKinsey for five years and worked exclusively in consumer financial services, mostly insurance, which is where I met my co-founder. We saw a lot of opportunity to do something digital and consumer-focused in insurance. Distribution was a consistent theme across all the companies we worked with. They struggled to reconcile a traditional, agent-based sales force with an increasingly digital consumer landscape. There was a chance to rethink the model from the perspective of the consumer — after all, most of life is digital today, from shopping on Amazon to banking.

Q: What’s attractive about the insurance business for a tech entrepreneur?

Fitzgerald: Though people didn’t see it a few years ago, this is absolutely a huge market. The other thing that attracts us is there is a lot of value locked up in inefficiency and big challenging problems, from distribution and underwriting to legacy products, that represents opportunity if you know how to tackle it.

Q: What advice would you give women who want to enter the insurtech sector?

Fitzgerald: The first advice I’d give to them is to make sure you really want to do it. It’s the most challenging thing you’ll ever do in your business career, because every day brings a new problem that you have probably never seen before.

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