Page 34 - Insurance Times November 2021

fractions of insurance for a particular moment, time, and The travel market has also grown and there are travelers
miles count. These new opportunities are increasingly tied to with a variety of preferences and budgets to cater to. So the
mobile devices. hospitality sector has absorbed this new trend, and not
necessarily to the detriment of the traditional players in the
As mentioned earlier, a disruptor in the business context is an hospitality sector.
organization bringing in new technologies and other
innovation into the industry, to cause a radical change therein. What really emerges from these instances is that
Though Insurtech is commonly associated with disruption, in some remarkable changes may even lead to
my view, it is still premature to categorize Insurtech as a facilitation and not necessarily disruption in an
disruptor. Insurtech had emerged on the scene with the
potential to bring in radical change as a disruptor but now existing industry.
things appear to be taking a different turn. The dictionary meaning of a facilitator (noun) is a person or
entity that helps in assisting another in doing something more
In their own time there have been other sweeping changes easily by discussion, providing advice, mentoring, etc., rather
which have brought about, what can be more appropriately than offering a ready-made solution without any involvement
termed as disruption or radical change. An instance, though of the recipient. For example, a teacher acts as a facilitator
not from the domain of finance, would be the sweeping of learning. Therefore, in the context of the insurance
change in the transportation sector. Upto the eighteenth industry, it would refer to entities assisting the insurance
century, road-travel was mainly undertaken by horse-drawn industry to achieve some goal or providing help in modernizing
carriages. Subsequently, there was a change when steam the industry with new learning leading to better benefits for
engines and then the internal combustion engines were all stake-holders. It is thus beneficial and not detrimental to
introduced. The travel industry grew and gradually horse the insurance industry.
carriages went into disuse and the steam engines were later
replaced by diesel engines and even later by electrical Though the Insurtech new-comers made their presence felt
locomotives, bullet trains, driverless trains, Maglev etc. Thus, in the insurance industry with cutting edge technology and
new technology in transportation was first a disruptor, was innovative products, and may even have been viewed as
gradually absorbed into the industry and eventually became upstarts, they are here to stay and now co-exist with the
an integral part of the sector. established insurers. At this stage, it would be appropriate to
state, in my view, that Insurtech has provided a great deal of
The entire eco-system changed and many organizations value-addition to the insurance industry by their innovative
connected with the earlier forms of transport, went into closure. products and use of emerging technology.
But the transportation industry thrived and provided
convenience at an affordable cost for consumers. Similarly air As Insurtech is forging a new path in the insurance sector,
travel has put the erstwhile passenger liners out of business and which brings multiple benefits with it may now be argued
become part of the travel industry. Mass travel is now common that the established but adaptable insurers are possibly
and affordable. This would be a good instance of disruption. viewing them as new entrants who have something
constructive to offer the legacy bound global insurance
But remarkable change and not radical change may take place industry.
in many different ways. The degree of change and the extent
of the impact on the sector concerned is required to be At this juncture, it may be prudent to carefully observe the
'measured' in order to evaluate the role of the new-comers. To changes taking place in the insurance to frame a proper
focus on a relatively modern development, in the hospitality response or policy on the same. A considered analysis about
and travel sector, the "Airb&b" concept arrived as a potential the role of Insurtech, with more data, in this respect will
disruptor in the hospitality sector. They provide personalized then emerge which will assist in coming to a proper conclusion
comfort, stay and even food at relatively affordable rates to in the matter.
travelers all over the world. Bookings take place online and
they have their scheme of certification for the discerning Determinants required to assess
traveler to choose from. But they have not put the traditional whether Insurtech is actually a
hotels out of business. Both systems exist side by side and their
advent would, in the medium to long-run increased the size of Disruptor?
the market, which is a positive for any industry. One would need some determinants of the extent of the

34 The Insurance Times, November 2021