Earlier this week, online small business lender Kabbage raised $250M led by SoftBank Group. As part of the announcement, Kabbage announced that it would look to potentially offer new products like insurance and payroll services.
What might this look like from the vantage point of Kabbage's potential insurance partner? In November 2016, when SoFi announced it would partner with Protective Life to launch a term life insurance offering, the news was almost entirely covered from the angle of "SoFi is entering the insurance space."
But it's interesting to see how Protective rationalized the partnership. Here's what Protective management said on a March 2017 company update (slide from the presentation below):
"What we're trying to take advantage of is brand with customers, like with Costco. If you're a Costco member, you have a lot of confidence in Costco so if they affirm that you're their exclusive provider it really helps lets you use their brand to affirm your offering."
Perhaps more relevant is that Protective might not have been able to fulfill the partnership had it not adopted certain new technologies and approaches to product design. As they explained:
"I don't believe we could have gotten up and running (with SoFi) in the time we did had we not adopted a more agile approach in terms of what we did."
Tencent deepens focus on insurance
Earlier this summer, we unpacked Zhong An Insurance's IPO prospectus to take a deeper look into its products, partnerships, and regulatory landscape.
This week, one of its founding partners, Tencent, announced it would be moving forward with a new online P&C insurer called WeSure Internet Insurance with a $55.5M investment from Taiwan's Fubon Financial.
The announcement noted that WeSure has not received an insurance license yet. Recall that earlier joint ventures such as Baidu teaming up with Allianz and Tencent with Aviva in Hong Kong have also faced license issues. Compounding those issues is that China is currently looking to appoint a new insurance regulator.
Look to the sky
Farmers this week announced it would launch a new drone program with Kespry to assess residential property damage (drones in insurance was also the topic of a WSJ piece this week below). My colleague Nick Pappageorge recently put together a comprehensive primer on the state of drones. You can get the full 69-slide deck here.
Have a great weekend,