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Latin American banks are partnering with tech firms to harness their innovation and agility to bring new products to market quickly and efficiently - and insurers have started following suit.
The trend is growing in the region, including in Argentina, where an event in March will act as a regional collaborative space for tech startups and established players from the insurance sphere.
Branded Insurtech Latam Forum, it is being jointly organized by Digital Insurance LatAm - a company that helps bring together stakeholders from the respective worlds of insurance and technology - and consulting and events firm IMS.
"In Argentina, and in Latin America, there exists, on one side a vibrant tech startup ecosystem, and on the other, a segment of traditional players trying to accelerate their transformation and innovation processes," Digital Insurance LatAm founder Hugues Bertin told BNamericas. "The forum will constitute a bridge that joins these two worlds."
The knowledge-sharing and networking event is geared not only to tech firms and insurers but also to brokers, agents, investment funds, accelerators, IT providers and consultants, among others. The forum will also host Insurtech Pitch Day - the first of its kind in Argentina - where five pre-selected collaborative insurtechs will pitch their ideas to insurers and entrepreneurs in a competition format.
"We believe there is a very important opportunity in the market," said Bertin. "Fifteen years ago, on average, it cost US$1mn to launch a startup. Today, with US$50,000, you get a team of entrepreneurs who can remedy insurers' pains through insurtechs. For example, how to automate my back office, how to stand out from the competition, how to start handling the internet of things, which is going to be a disruptor in the world of risk. How to maintain recurring contact points with policyholders, and more much."
Examples in the region of alliances between insurtechs and established players are digital life insurance platform Klimber (which offers Prudential policies) in Argentina and Jooycar (which powers Colombian giant Sura's pay-per-km and pay-how-you-drive solutions) in Chile.
Latin America's insurtech ecosystem is nevertheless smaller than the region's fintech ecosystem. In terms of maturity, it also trails that of developed markets such as Europe and the US.
However, Bertin is upbeat on the future. "Today, you could say that we're 2-3 years behind, if we compare ourselves to the global leaders," Bertin said, adding that within the next 2-3 years innovative players such as Lemonade, Zhong An or Trov could arrive.
Also on the collaboration front, this week Prudential announced it was partnering in Argentina with Discovery, which operates the innovative Vitality health and life and insurance platform. Discovery also has partnerships in Ecuador, with companies Salud and Equivida, according to Vitality's 2018 annual report.
Insurtech Latam Forum takes place in Buenos Aires on March 27.