The Term Insurtech is Outdated. We’re Now Living in the Time of Metasurance Web3 Companies.
Insurtech has been fantastic for the insurance industry. it has forced traditional insurance companies, huge and bloated from centuries worth of acquisitions, to consider this thing called “the internet”, and figure out how to sell to their customers online.
They have pushed (maybe dragged) the insurance industry into the 21st century by adopting many of the business strategies developed during the Web 2.0 era. They’ve “moved fast and broke things” by burning through millions of venture capital and reinsurer dollars in the pursuit of growth, somehow managing to go public at billion dollar valuations while maintaining a 235% loss ratio.
This is all very exciting. However, when you start to look under the hood, you might start to ask yourself, what exactly has changed? Strip away the fancy apps and quirky corporate art, the “machine learning” claims handling (recall those loss ratios) and what do you find? Usually, a very traditional insurance company with long policy forms, extensive public filings and straightforward actuarial rating algorithms. Maybe with an AI twist.
I expect in the coming years we will see an entirely new breed of insurance company. Due to the heavy regulation of the insurance industry, there may be some clever workarounds to avoid their products technically being “insurance” (warranty service contracts anyone?) but the mechanics will be similar. The kicker, of course, is that these will be the “Blockchain based NFT Smart Contract policies” we’ve all been waiting for.
Thus, I propose that the term “Insurtech” does not apply to these projects. Insurtech is so 2010s. What we need is a 2020s, decentralized, tokenized, Web3 version of this term. Here are a couple thoughts I’ve had:
- Cryptosure Companies
- Advantages: Straightforward, easy to remember, rolls of the tongue
- Disadvantages: There is a lot of stigma that comes with the term “Crypto”. It’s not immediately evident that it’s insurance related. Also, there seems to be a (defunct?) marijuana insurance startup with this name.
2. Insurechain Companies
- Advantages: It’s insurance. It’s blockchain. What more could you want.
- Disadvantages: Blockchain is the buzz word of 2013.
3. Metasure/Metasurance Companies
- Advantages: Broader than just crypto, the metaverse might be more future proof.
- Disadvantages: Either the Metaverse is just a 2021 buzzword, or this will get popular and I’ll get sued by Facebook.
My personal favourite? I’m going to start calling them “Metasurance” companies, and see if it sticks. If you have other ideas — feel free to leave a comment.
I’ve created /r/Metasurance where I will be collating all the links I find while researching this subject. I would love for you to join the subreddit, and contribute!
