For decades, Silicon Valley has been referred to as the startup hotspot. However, in recent years, other metropolitan areas have emerged seeing that viable alternatives. Places previously thought to be being less appealing have surged over the country, from Seattle to Boston, driving innovation and purchase in a different group of tech companies which range from biotech to finance sectors.
New York City, specifically, has differentiated itself as the brand new capital of insurance technology (aka insurtech), playing house to disruptive players in the house, casualty, health, auto, family pet, SMB, disability, and life insurance coverage verticals. This is driven, in large part, by the city being home to a significant number of Fortune 500 insurance players, such as AIG, Metlife, Marsh, Chubb/ACE, New York Life, Assurant, and Travelers among others. Proximity to these large financial services firms offers startups greater opportunity to develop partnerships or bring in talented individuals with industry experience.
Oscar is a perfect example of a New York insurtech startup made good. Oscar, based in the heart of NYC, is attempting to disrupt health insurance. Founded in 2012, Oscar is an online platform that allows individuals ( and now businesses) to get health insurance quickly and very easily. The company initially offered plans only in New York, but has recently expanded to three additional states. In 2016, Oscar was valued at $2. 7 billion.
Another, insurtech startup, CoverWallet, has its eyes on disrupting House plus Casualty insurance for small business. Also based out of NYC, CoverWallet has made vital strides in their digital-first approach to commercial insurance, helping business owners to understand their risks and safeguard themselves. CoverWallet’s goal is to make business insurance easier to understand and more accessible for small businesses almost everywhere; combining intuitive online products with concierge-like support. CoverWallet launched in 2016 and has already been named one of the Best Entrepreneurial Companies by Entrepreneur Magazine and recently partnered with Starr Companies to develop new insurance products to better serve small businesses.
“Given the intense regulation in insurance, finding the right partners and hires with domain expertise is a critical part of successful industry disruption, ” said Inaki Berenguer, CEO of CoverWallet. “In launching our partnership with Starr and Hank Greenberg, we’ve appreciated the benefits of being able to hook up directly, in-person. Success in taking on the small business insurance ecosystem requires the ability to react quickly, build associations with partners and physical proximity helps all parties to be aligned to tackle opportunities as soon as they come up. ” Mr. Greenberg, current CEO of Starr Companies and former CEO of AIG, was called Crain’s Most Connected New Yorker in 2014.
Furthermore to proximity to close by insurers, NEW YORK in addition has distinguished itself as a hub for insurtech because of its way to obtain ground breaking marketers and innovative capital. NEW YORK, the house of Madison Avenue, is definitely where companies head to build a brand, marketplace their items and establish their existence. CoverWallet, in competing with bigger, more established brands is certainly leveraging NYC’s many innovative resources to improve how smaller businesses perceive insurance. Merging technology and style talent, CoverWallet has generated a platform to erase the tough edges of insurance and offer an user knowledge that modern-day businesses attended to anticipate from their financial providers. Regarding to Berenguer, “insurance won’t be romanticized like style, music or theatre but we prefer to believe we are intersecting the innovative thinking about these professions with the day-to- time nuances of insurance. ” The draw to NYC isn’t strong simply for startups like CoverWallet and Oscar. Aetna, the huge health insurance carrier, lately announced that they might end up being relocating their headquarters to NEW YORK (Chelsea) starting in past due 2018, to be able to further transform the business to meet the demands of our fresh digital age.
“Small business owners need to spend their time growing their business, ” said Berenguer. “Handling policy information on-line implies that when you have the opportunity to close a deal, but just need to provide a certificate, you may get the document immediately and move forward rather than tracking down your agent. Every business faces risks, but interacting with your coverage shouldn’t increase those risks. ”
Launching in NY maybe harder than most of the states, while the regulatory environment is considered tough, however , some of the entrepreneurs who also operates in NY, observe this while an advantage “We purposely chose New York as Lemonade’s first state. Beyond it being an economic capital, we wanted to work hand in glove with NY regulators and state legal system, as it’s known to be one of the most exacting in the world. We wanted to drive ourselves to get licensed in such a ‘strict’ state so that we would be able to replicate the licensing process in other says nationwide. So although we can attest that the NY regulatory environment is definitely ‘tough’- I think it’s more fair to say they were exacting, yet fair and available to the game-changing technology ” stated Daniel Schreiber, CEO and cofounder, of Lemonade.
In the past couple of years, the insurtech scene in NEW YORK has extended significantly, and it appears like that trend might continue given the breadth of the insurance industry. NYC startups possess popped up to handle not simply health insurance and industrial insurance, but also life insurance coverage, renters insurance, automobile insurance, family pet insurance, and disability insurance. Businesses are also creating brand-new coverage items, such as for example on-demand insurance, and back-end technology for agents and insurers.