Figures from Swiss Re show that “$1.3 trillion (70 percent) of global economic losses derived from natural catastrophes in the past 10 years were uninsured”. Gethin Jones and Laurent Sabatié co-founded Skyline Partners to address this gap and have started by focusing on weather risks in India. Intelligent Insurer speaks to them to find out how they plan to close the global protection gap.
When and why did you start Skyline Partners?
We started the company in 2017. Before that Gethin was head of change and transformation at Chaucer Syndicate and Laurent was chief actuary at managing agency, Syndicate 1110 at Lloyd’s of London.
We started to look at how we could combine new technology and opportunities in the insurance model by combining it with data driven products and accessing new markets.
Skyline was set up to use new technology to bring new products to new people who were underserved by financial protection. We wanted to close the protection gap and be innovative with protection products using distributed ledgers, real time analytics and the cloud. Previous products were not profitable or too expensive, so by being purely data driven we felt we could develop products that eliminated lots of steps in the process and offer better data and risk models.
What have you achieved so far?
In 2018, we built our concept product and platform and sourced initial seed funders.
We have a pilot launch planned for Q2 in India this year. And we have partnered with IBM. They invested as part of their global entrepreneur programme, although they are now commercial partners.
One Advent was our initial funder, they also provided support with gaining our AR status and getting our regulatory approvals in place.
We’ve been working out our distribution of partnerships in India. It’s around extreme weather and how it affects agriculture, construction and renewable energy,
Why did you choose to launch in India?
Our vision is to target the unprotected populations of the world and we identified India as in the top three most under protected.
India is very technologically advanced and homogeneous in terms of regulations because it is one country. There are 1.3 billion people to access, plus the 3G network penetration is good. This enables us to target customers and provide products and make a difference.
India is also a young country, 50 percent of the population are under 25 years old, with an emerging middle class. People are looking for financial protection and we are concentrating on weather because the country is heavily dependent on agriculture. There are 400 million farmers in India and there is a growing renewable energy market and large construction projects going on as well. As a country it is very under protected, so the demand is there and people are able to consume it digitally.
How are you driving public-private partnerships to help to close the protection gap?
The Indian government was one of the first to develop public programmes to serve the under protected and funds a scheme for farmers to protect their business and life from weather risks. Private insurers are getting involved in taking the risk subsidised by the government. We aim to complement this.
As the government's scheme is very large, we’ve started by providing short term protection liquidity, while the government is looking after the smaller, low income social security side.
There are still some elements of friction in the government scheme that could be helped by digital technology, which we are developing. For example, one issue for the Indian government is high cost because of the manpower needed to run the scheme. Our plan is to automate this using smart platforms.
At the moment we need to prove the concept, so we’ve started by targeting a slightly higher tier with more tailored risk protection for the middle class. Then, later, we’ll extend into the population with parametric products, open APIs, and blockchain to operate and automate the process and move to large volume.
What is the next step for Skyline?
We will begin our pilot in Q2 this year, which will run for six months. We’ll monitor performance of the product and platform and if it’s successful we’ll scale up and roll out.
Laurent Sabatie is speaking at Intelligent Automation & AI in Insurance Europe (May 21, London)
For more information on the agenda and speaker line up, please visit the website www.intelligentautomationeurope.com
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Skyline Partners, Swiss re, Catastrophe, 2018 Results. Gethin Jones, Laurent Sabatié, Chaucer Syndicate, Lloyd's