For insurtech, many experts are turning east to the Asia Pacific-based insurance companies who are leading the way. And, the word is that even there, the insurers are lagging behind financial services companies in the implementation of technology.
The Asia Pacific Guide for Investing in Start-ups is a new guide from a leading global law firm Baker McKenzie, that serves as a comprehensive handbook for insurance companies when contemplating an acquisition, partnership or joint venture in the insurtech space.
Singapore-based fintech and insurtech adviser Stephanie Magnus, a Principal at Baker McKenzie Wong & Leow, said: ” Insurance companies are playing catch-up. They are lagging behind their financial services peers in technology implementation. We expect to see insurtech incubator and accelerator programmes to produce key acquisition and JV targets for our big insurance clients, and expect this to remain an exciting space for business tie-ups over the next 18 to 24 months.”
Brian Chia, head of corporate and commercial practice at Wong & Partners, member firm of Baker & McKenzie in Malaysia, added: ” This is strategically important for insurance companies. They are motivated to explore new distribution channels, product offerings, as well as risk assessment and management capabilities that are made possible by insurtech. With increased margin pressure, insurance companies need to join the insurtech race to stay in the game. ”
As the insurtech sector continues to heat up, wide variations in regulatory approach to insurtech investment and utilization exist. Insurance companies in Asia Pacific are facing a “labyrinth” of regulations as they increase investment in the insurtech space.
Commenting on investing in insurtech start-ups, Dr. Isabella Liu, Intellectual Property Partner at Baker McKenzie in Hong Kong, said: “In addition to regulatory challenges, particularly in areas such as telematics, biometrics and big data, insurance companies are challenged by other considerations in relation to data privacy, cross-border data transfer and intellectual property protection around insurtech investment.”
The Baker McKensie report identifies and clarifies what makes or breaks a deal in relation to investment criteria, corporate approvals, corporate governance, connected transactions, remuneration structure, intellectual property and data privacy across 11 jurisdictions in Asia Pacific. It helps insurance companies steer through ambiguity and uncertainty, and gain visibility into what is possible in the region’s complex insurtech transactional landscape.