Anorak scores £4M funding to make life insurance more accessible
VCs continue to pump money into startups attempting to inject life into the legacy and lucrative insurance industry. The latest ‘insurtech’ company to pick up funding in the U.K. is Anorak Technologies, which is on a self-described mission to “build the world’s smartest independent insurance adviser,” starting with life insurance.
The London-based startup has raised £4 million in seed funding from Kamet Ventures, the €100 million-backed incubator set up by insurance giant AXA. Anorak says it will use the new capital to invest in the platform, including taking advantage of Open Banking, and for business development, such as forging partnerships with banks, wealth managers, and online brokers.
Like almost every other insurance startup, Anorak is talking up its use of data science and machine learning to help you find the life insurance policy most suited to you. But, tellingly, it is also trying to crack the sales and distribution funnel, noting that most people in the U.K. don’t take out a life insurance policy or have sufficient cover.
To do this, the startup is making a partnership and API play so that its digital insurance brokerage can plug into other products, such as online banking and e-commerce, to offer up the right product at the right time. This might coincide with a significant life event, such as buying a house or starting a family.
“The most important aim for us is to figure out exactly what kind of protection you need,” explains Anorak co-founder and CEO David Vanek, who previously held major roles at Made.com.
“So we gather the necessary data from you about your family, home, income and finances. Then, having scanned policy documents from all the major insurers, and analysed hundreds of pages of smallprint, we find the best policy to suit your circumstances. We’re independent so there’s never any pressure to buy: you apply when you’re ready”.
In addition to matching you to the right policy, Vanek says the company is looking at how to integrate Anorak seamlessly into people’s digital lives. This will see it partner with fintechs, including challenger/neo banks and PFMs, and plug its wares into e-commerce offerings to start a conversation about life insurance “at just the right moment, when they already have these ‘big’ things on their mind”.
“We see ourselves as a smart data company that delivers independent insurance advice, founded on trust and transparency. Our vision is to build the world’s smartest insurance companion and redefine the way millions protect their future. To put people back in control,” he says.
To achieve this, Anorak claims to have digitised the entire journey, including policy rating and matching, and translating insurance jargon into plain English.
“Somewhere along the way, the life insurance industry lost sight of its customers, clarity and trust dropped off the menu,” adds Vanek. “If you’ve ever been through the process, you may understand: it’s a universe of confusing products, insurance jargon and painstaking user experience (if we can call it that). Even when you know you should sort out your life insurance, it gets pushed to the bottom of the to-do list, because, well, life takes over. For that reason, it’s often actively sold, not proactively bought”.
To that end, Anorak’s typical customers are described as young families, people who need life insurance when they start having dependents (partner, children, etc.). “There are key life events when people need to consider getting protection: birth of children, taking a mortgage, [and] change in income,” says the Anorak CEO.
Published at Mon, 22 Jan 2018 12:40:14 +0000