The broker as architect: Designing the future of automotive insurance

Raja 0:45

Amazing! And how is the business doing for you?

Frederic Bouchet 0:47

We can see a lot of very exciting challenges coming with the Chinese car makers going outside of of China, and with this as a quite good position because we we are one of the few global insurance brokers, and in Willis, and this is really maybe where it's called secret sauce, we we combine different line of business and different capabilities that we align in the in the on the interest of the of the car maker. So we we pretend not to be a standard placement broker, but we behave more like what we like to call a broker architect. We design solution, and to do so, we combine the teams like ICT, Risk Analytics, the actuaries of the of the company. You can consider any insurer; they have no more actuaries than we have. So this is very useful because some car makers will have what we call service product contract, they will not have insurance, and one of them I cannot mention any name here, but we have a very large European car maker we work with, and we know them in a more comprehensive, let's say, warranty strategy, combining self-funded program on their own and also insurance program, and so they can opportunistically decide which which thing to do. Should I sell for the product which gives the best price because they don't have the margin on the insurance company to pay, or should I leverage insurance product when, by regulation, it's mandatory? So this is the one big pillar we have. The second one is obviously the brokerage one, but we try to be innovative in that one because we may use a local insurer, but we may also find regional insurers, and we may also use reinsurers and NGAs. The time when we were doing, like let's say, a specific brand for, let's say, Italy and for motor insurance, and we were just doing the placement, is something we don't do anymore because after two years the the car maker will say okay you found me the good insurers but what is your added value I don't see it anymore so it brings us to the third pillar which is technology and this is maybe probably why we discuss together today is the technology became very strategic very crucial we we went through the digitalization I would say of the insurance distribution if you think 10 years ago, mostly the car makers were using the dealer channel, the face-to-face channel to sell insurance, and it was only possible in few countries because the regulation make it very difficult for dealers to be insurance intermediaries. But in countries like UK, it's very different. In France, it's very different in U.S. It's very different. It's more digital, or clients will go to their insurance company and what try and what want to do the OEMs is to to be part of the insurance offer to the to the customer, leveraging their brand, their data, their different touchpoint they have. They know when your OEM warranty will expire. They know when your car will be delivered the first time. They know when the car will be repaired. So it gives them a lot of touch point to to leverage. And this is something where you need CRM, when you need APIs, when you need technology. And this is where Willis, I believe, I will not compare with our competitors, but I will say that we are probably more open to work with third party in short tech, we have not only one but plenty of different insuretech we we discuss with and we try to have strategic partners in this area. I will say a few to work with, and the the thing is that when we when we deliver to our partners, the car makers, they know that we we did the the research, the the compliance approval, and what we bring to them is something we certify as the quality level of release, and we front it. So for them, it's a unique top shopping point for them, which is very convenient.

Raja 4:34

Amazing! Thank you so much. And you know, I personally understand the journey and how exciting this business is, because you know we at InsureMo when we started 10 years back. So auto and mobility was one of the very high growth potential areas for us. You know, so we could because we started as an ecosystem friendly API platform. So the whole idea was that can we provide APIs which are ecosystem friendly, which means can you embed this into an automobility ecosystem? To you know, can you bet this into an e-commerce? Can you bet this into a fintech or telco? You know, and we felt obviously banks is the largest, bank assurance is the largest. After that, even for us, you know, automobility is probably the second largest and probably the fastest growing. Then even then, banks, the growth rate here is amazing. And I think we also feel that technology has evolved massively, and the reason why we were the pioneers in this whole space was, you know, we could see the impact an API could bring to this. So, with that, you know, we are while we are discussing, I can't let AI, the elephant in the room, be out of this question. So, let me let me again ask you a question around the AI stuff because we, being from an ecosystem-friendly API, we are now an AI-friendly API. You know, again, we've been very lucky because we've been doing ecosystem-friendly APIs for the last 10 years. Now, with this whole AI being so real right now, what's your take? What is Willis doing to address this whole AI challenge? You know, if I may say.

Frederic Bouchet 6:00

So we cannot comment everything on that topic, so I have to be cautious with my answer. But I will say that you have done the very good Robbie anticipation as you did before with the API, now with the AI, because we can see that AI is at least a coming new sales channel. I will sell. I would say sorry, and it's probably also becoming soon a transaction channel as well, and we will think that today you may replace plenty of people have replaced Google Search Bar to to different conversation tool, ChatGPT or whatever the platform we can say, and they will I think do potentially three things step by step. The first one that they can do today is the discovery. I have this car brand. I live there. What do you think I should do? Which cover I should take? Do you advise me to take this or that? So they will guide you what to do. And then I believe that AI does not say anything it has not access to. So I believe that the API thing you have done and the AI friendly API you have is very key because I don't believe I will keep the example of ChatGPT, but it's it's agnostic. I don't think ChatGPT can quote an insurance if they are not connected with the good API to quote. So this is the second thing. So the quote will be possible to to happen, and I think that AI are also doing everything needed to be able to do the payment, also so to transact the solution. So probably in the future, I don't think. But you are the technical guy in the room. I'm not. But I don't think today we could transact and issue an insurance policy through AI. Not leaving the the chat of the of the AI tool, but I think it's coming. And I believe the key thing for us, coming back to your question, is what will we do in the near future? And I say the near future to be part of it because we work for our car makers to keep control of their ecosystem. We deploy for them. I mean, they deploy also aside. We don't do everything for them. They do. Everyone brings the the good thing in this ecosystem. But there's ecosystem to resist. Let's say I'm a new car owner, and I ask ChatGPT or Claude to to give me some ideas. And if, let's say, one insurer has already integrated with this ChatGPT thing, it may propose a generic insurance offer, which is far less efficient than what the specific brand of my car could offer me with connected services. If it is an EV card or the status of the battery, it could get, it could leverage the connectivity of the cars. It could leverage plenty of data, usage data, and so it could make be much more efficient and smarter. So I think what we will focus on on the next the next months, the next years, probably more months than years, is to be part of this, to be the one that will be seen as the referenced official insurance partner of this particular brand. So the offer will be specific to the car brand you own and not generic like an insurer could do. So I think the challenge for us is to be to be part of this revolution, evolution, and to be, I hope, one of the few being able to embrace this change. So, company like you will obviously be very helpful for us to to navigate this change.

Raja 9:08

Yeah, and I'll take one last question because you know you pimped up a point on automobility, and now when you talk of automobility, you know it's not just one party and the second party, right? It's an ecosystem. Yeah, and what we've been doing in these 10 years is solving the connectivity problem for the ecosystem, right? So there is there are brokers, there are car dealers, there are car manufacturers, there are spare part dealers, there are roadside assistance companies, there are toll taxes. Today there are reward companies, fintechs. Everybody's participant into an automobility ecosystem, right? And we've been solving this using API. How do you see this partnership of so many players in the auto and mobility ecosystem evolving.

Frederic Bouchet 9:45

I think you may be in love with one particular brand, like the car. You get finance the car. You you like the rate. You you have some some claims experience. The car is well repaired, but there are multiple. Let's say. Touchpoint and interaction you have in your lifecycle or the lifecycle of the car with the with the car maker, and if something was goes wrong, let's say, it may it may dissatisfy you enough, so you will switch the brand or you will go somewhere else. And the more you can articulate all together this complex, I mean, comprehensive ecosystem end to end, the better you can deliver a great experience because it's not to sell what the car maker are looking to is not to sell an insurance policy, is to deliver a customer experience, and this is doing just what you explained, onboarding all the different step of the journey, the different partners, the the whole ecosystem in a unified and and smooth way, frictionless way that I think we can give what the customer are looking for. It's a real-it's a real differentiator, I think.

Raja 10:43

Amazing! Thank you so much.

Frederic Bouchet 10:45

Thank you. It

Raja 10:45

was a pleasure.