RPC Insurtech in brief - March 2023
Welcome to the March 2023 edition of Insurtech in Brief - a selection of the latest insurtech news and developments from across the globe.
Tesla ready to join UK insurance market
Reports have indicated that Tesla is looking to start offering insurance to its drivers in the UK after Companies House filings show it is seeking to open a branch of its Malta-based insurance business.
Tesla initially launched its insurance offering in California in 2019 and has expanded to provide coverage in 12 US states and Europe.
The company differentiates itself by using data from the vehicles to model driving behaviour, with safer drivers being rewarded with lower premiums.
Elon Musk's ability to attract talented individuals with a keen interest in disruptive technologies has been key to the success of Tesla. The tech titan has already called on actuaries to join his insurance team in another example of the war for talent in the insurtech market.
Roadzen to go public
Indian insurtech Roadzen announced plans to go public by merging with blank-check vehicle Vahanna Tech Edge Acquisition I Corp (Vehanna) in the United States. The deal values Roadzen at a pre-money equity value of $683m and the combined company will be listed on the Nasdaq exchange.
Roadzen has built a technology platform that uses telematics, computer vision and artificial intelligence across underwriting, distribution and claims processes.
The Listing Rules were amended following a review by Lord Hill in March 2021 to ensure London remained a competitive venue in response to an increasing number of special purpose acquisition company (SPAC) deals and listings in the US.
Insurtech companies such as Ondo and Financials Acquisition Corp have listed in London since the changes. However, the amendments to the Listing Rules have not caused a boom in public market activity amongst insurtech companies and given the uncertain economic climate it seems unlikely that we are going to see a significant increase in the near future.
io.insure enters UK market
Australian tech and insurtech firm io.insure entered the UK market with a product which it claims to be the first global M&A and specialty insurance online marketplace.
The company believes that M&A insurance products aren’t tailored to SMEs, can be time consuming to obtain and are often cost prohibitive leaving a large number of deals without insurance.
The platform aims to fill this risk protection gap by connecting customers, advisors, distributors and insurers. The firm has also entered the US market since its initial launch in Australia.
io.insure's focus on SMEs is part of a growing trend of insurtechs across the world competing with leading incumbents to offer insurance packages tailored to the needs of small businesses.
Tech Nation to close
UK Government-backed Tech Nation is due to close this month after it lost the Department for Digital, Culture, Media and Sport’s Digital Growth Grant worth around £12m.
The company provides a network for technology entrepreneurs to provide coaching programmes and act as a conduit to investment. Tech Nation also offers a Global Talent Visa, which allows tech talent to work for businesses in the UK’s digital sector.
Insurtech companies face a tough fundraising environment as elevated interest rates and inflation have made investors tentative and demanding higher returns. The removal of support from organisations like Tech Nation only exacerbates difficulties as insurtech businesses have to look elsewhere for advice in relation to investment and talent acquisition.
Despite the potential vacuum created by Tech Nation's closure, insurtech companies with innovative business models are continuing to attract interest from investors and can support from other organisations such as the British Business Bank, equity crowdfunding company Seedrs and Innovate UK.