Industry Lacks Personalization; Customized Products on Deck for the Future, Next Insurance CEO Says

This article is part of Carrier Management’s series on the Future of Insurance.

Guy Goldstein, Co-Founder and CEO, Next Insurance, believes an insurance industry today lacking personalization needs to move to one that tailors products to business customers.

Guy Goldstein, Co-Founder and CEO, Next Insurance

Guy Goldstein is the Co-Founder and CEO of Next Insurance. He is the former CEO of Check, a mobile payment company that was eventually sold to Intuit for $360 million. https://www.next-insurance.com

Goldstein and Next Insurance co-founders Nissim Tapiro and Alon Huri started the company to fix a problem they discovered while starting up Check—that it took way too much time and energy to obtain and maintain insurance for their company.

Next Insurance aims to transform the experience for small-to-medium business insurance with a tailored, personalized approach, partnering with trusted insurance providers to deliver policies that are tailored to the uniquely specific elements of each small business sector. Utilizing big data technology, Next Insurance uses insights into consumer behavior to identify the right policy at the right price.

Founded in 2016 by a team of serial entrepreneurs, the company is headquartered in Palo Alto and has received a total of $48 million in venture capital funding from Ribbit Capital, TLV Partners, Zeev Ventures, Munich RE Ventures, Markel, Nationwide, American Express and more.

Goldstein has 20 years of experience in technology, product development, management and strategy, with prior stints in corporate development and R&D at HP software and Mercury Interactive. He once served as a fighter pilot in the Israeli Air Force and holds a bachelor’s degree in business and computer science, cum laude, from the Tel-Aviv University.

Q: What major changes do you see on the horizon for the property/casualty insurance industry in the next 10 years?

Goldstein (Next Insurance): When we look at the future of insurance, there are two parallel trends that can be seen. The first change comes from technology, which will impact risk. The second change is how insurance is going to be serviced to customers.

The Technology Shift. Technology is expected to advance exponentially in the next 10-15 years, increasing by thousands of percent in its capabilities compared to what we see today. There are many future predictions that are becoming more real every day, such as the likelihood that automation will remove humans from the driver’s seat of vehicles, the printing of human organs, which reduces medical costs significantly, a highly intelligent home that can protect itself from potential harm, and many more.

In such an environment, the risks will dramatically decrease, as will the costs to remedy these risks, ultimately decreasing the cost of insurance. To modernize, insurance companies will have to reduce their fixed cost to be able to cope with the reduction in premiums.

Serving the Customer. The insurance industry lacks personalization, with risk factors and underwriting still relatively generic. As insurers are able to compile more sophisticated and in-depth data about risk, it will be easier to tailor the insurance needs to the specific customer. In business insurance today, we still have catchall insurance types such as general liability, inland marine, employee liability, etc. What we should have is insurance that is tailored to a plethora of subcategories, such as insurance for an Indian restaurant, insurance for a wedding photographer or insurance for a litigation lawyer.

There is little doubt that the entire insurance process will be direct and online in the future. There will no longer be the need for a mediator (in this case, an agent) between the insurance provider and the customer, as this online system will enable the customer to buy, maintain and handle claims all in one place.

The insurance system today is built on agents, actuaries and underwriters, who will be replaced with simple-to-use online interfaces, algorithms and artificial intelligence. With less personnel required and new technologies introduced, the costs of insurance will dramatically decrease, freeing up more of the insurance premiums to pay claims as opposed to serve the internal needs of the insurer.

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Guy Goldstein, Co-Founder and CEO, Next Insurance

With less personnel required and new technologies introduced, the costs of insurance will dramatically decrease, freeing up more of the insurance premiums to pay claims as opposed to serve the internal needs of the insurer.—Guy Goldstein, Next Insurance