Tech-ing over Insurance
Insurance - the word alone is enough to trigger a visceral reaction in many people. From high premiums to complicated paperwork, the ethically ambiguous business practices of those who have dominated this space over the last few decades has left little faith from consumers in the industry as a whole. Queue Naked Insurance - complete transparency is literally in the name.
Founded in 2016 by actuaries Alex Thomson, Ernest North & Sumarie Greybe, Naked is an AI-driven platform that allows you to purchase insurance for your car, home, contents and single items completely online. “We all worked for leading insurance companies in South Africa before breaking away to start Naked,” explains co-founder Sumarie Greybe. “As consulting actuaries, we knew the insurance industry inside-out and saw first-hand how existing insurers are struggling to meet the needs of the connected consumer. We decided we could change that by building an insurance platform with modern digital technology at its core and a new business model where there is no conflict of interest between profitability and claims pay-outs.”
Through the Naked app, users can get a final insurance quote in 90 seconds and sign-up for cover in less than three minutes, guided by the friendly chatbot, Rose. In the background, the quoting system is completely automated, using a range of sophisticated algorithms and rich data sources to generate a fair, instant and final quote for the customer. Customers also claim via the Naked app guided by the claims chatbot, Jade. During this process, customers are prompted to take a video selfie and explain what happened. “By using AI to process these claims, we are able to instantly approve some claims without human intervention and pay them immediately,” Sumarie says.
An insurance company of this nature may have typically been considered niche, at least for the time being, due to its radical shift from the traditional landscape. However, the COVID-19 pandemic has accelerated South Africans’ adaptation to technology in many different sectors, and even those who may have ordinarily stalled in this regard have now been forced into a scenario where either personal safety or business relevancy hinges on their ability to change with the times. “We have enjoyed record sales during this time,” Sumarie says. “The pandemic has also helped shed light on just how robust digital models are. For example, a lot of people have wanted to benefit from our CoverPause feature which allows our users to pause their accident cover with one click if their car won’t be used for a day or more - saving them up to 90% of their usual car insurance premium.”
The recipients of numerous awards, including the MTN Business App of the Year 2019, the innovative minds at Naked are constantly optimising their technology to further enhance user experience. Incorporating an element of social responsibility into their business model is a great indicator of the principals from which the business is built. "Unlike conventional insurers, Naked takes a fixed portion of premiums to run the business, with the balance going into a pool to cover claims. The money left in our claims pot at the end of the year is donated to causes that our customers nominate. So, when they join Naked, our clients become part of a community who deeply values doing the right thing.”