In episode five of Zoom Into Insurance, Erik talks with Catalyit CEO & Co-Founder Steve Anderson to talk about why now is the time to move fast. They discuss the timing and rise of insurtech, new technologies around the corner, and why now is the time to invest in the future.
Steve Anderson has been leading insurance innovation since before insurance and innovation were conjugated together. He is the best-selling author of The Bezos Letters and recently launched Catalyit, a one-stop-shop for making sense of insurtech.
Here are some highlights from the episode:
You recently launched a new venture, could you tell us about Catalyit?
Catalyit is a company aimed at simplifying technology for insurance agencies. We discover, evaluate, select, and implement new technology that is impactful for insurance agencies. On one level it's what I've done for 26 years, but Catalyit is building for the long term; primarily helping agents and brokers discover new tech, know who's out there, what to do, and what to pay attention to.
Several state associations are founding members, and all understand that their members need help with technology. Associations haven't been known to be really helpful in the technology space, but we started talking and the end result is a for-profit group invested in by 7 state associations.
Now more than ever, there is a huge focus on innovation. Since this is something you've been doing since 1995, why is now the right time to innovate?
I have a bit of a different perspective, I don't think firms need to innovate first, I think firms need to invent first. In an email from Jeff Bezos to his company, he asked “how did we do it?” and he answers that with invention. Do crazy things together long enough and well enough to make them normal.
As an industry, we need to invent all sorts of things that are new; we need to invent new ways for customers to engage with us, we need to invent new ways for agents and brokers to communicate and more. To do so, we need to encourage successful failure, so experimentation comes first. If you know you won't fail then it's not an experiment. Experimentation leads to invention, and invention leads to innovation.
When you think about the current focus on innovation, what factors are driving it in 2021?
If there's a silver lining to 2020, it's the fact that the pandemic poured gasoline on trends that were already there. Work from home was already happening and there was some pushback, but all of a sudden everybody was doing it. That's just one example of a trend that was accelerated. The consumer has changed again. I, as a consumer, already wanted to do things online, but now even more so.
There isn't a new normal, there's a next normal. For that reason, everyone in the insurance ecosystem knows they need to do something and do it fast.
Many brokers and carriers are trying to do everything all at once. What advice do you have for principals to build a good foundation to innovate on top of?
One of the bigger issues is that the technology is often chosen because “so and so told me about it” as opposed to looking internally, determining what we need, what problem we're solving for, and then looking for the tools that allow us to do that. I have seldom seen a technology fail, but I see implementation fail often because of resistance internally. Like it or not, many agencies have the culture of “this is the way it's always been done.”
APIs are important to open up communication and realize the full value of the tools you choose. I have a new appreciation for open platforms because you don't have to find one size fits all, and you shouldn't. Legacy platforms are still an issue for this and I see that on the carrier side a lot.
There's a lot of innovation in personal and small commercial, what pieces of the value chain are under the most pressure today?
What's interesting to me is the multiple examples of startups making a direct to consumer plays, and then swinging back to agents and asking to work together. There's still an opportunity to collaborate, and I don't believe that technology replaces the interaction, but enhances it.
While we are seeing startups find ways to do things faster, independent agents have an opportunity to enhance the relationships. To do so, we need to meet the customers where they are and be flexible. A lot of agencies are saying they will never sell online and I think that's a mistake. Businesses might want to, and you should listen to your customers if that is what they want.
What are the best offensive moves for brokers to come out of 2021 strong?
Marketing and sales technology.
A major problem a lot of agencies have is follow-up failure and an unwillingness to change. Change doesn't mean changing everything, of course, you need to be intentional with it. Jeff Bezos didn't want to open physical stores because Amazon hadn't found a way to make it meaningfully differentiated. Most brokers can't explain how they are meaningfully differentiated.
Principal point: what's the one thing that principals and other insurance leaders should remember from this discussion to take into their day?
Be willing to experiment and don't be afraid of failure. If you're not experimenting you're not inventing and if you're not inventing then you're not innovating.
The State of Insurance Brokerage Innovation with John Jackovin
Reinventing Insurance Distribution: OnRamp Insurance Themes
APIs and the Future of Connected Insurance
In episode 6 of Zoom Into Insurance, Erik sits down with Caribou Honig to discuss APIs and the...