Where do you think the potential is for embedded insurance in the SME space?
So I think the kind of the problem with SMEs in general is that it's a kind of an underserved segment of the market. So in my opinion, you know, we don't see, the kind of products which they need. You don't think see things tailored like they should an SME. And I think if we're going to Embedded is going to target SMEs, I think it needs to be specific around something focused on that industry or that specific need or the product which they're buying.
I think that's where the most relevant use case for embedded in an SME is. So, I mean, maybe an example is something we're trying to do at WTW, which is work with vertical SaaS companies. So vertical SaaS, by definition, is focused on a specific industry, and we think that's where there's more relevance in terms of selling an insurance product alongside an offer. And I think horizontal SaaS is probably a bit too broad unless you're going to sell very broad cover like maybe, you know, employer's liability insurance. But I think if it's if it's focused on a specific industry or a specific product.
And then in terms of the product, for those, vertical SaaS platforms, would this be, like, standard SME insurances, or how would you would you tailor them to the specific context and need of that platform, user base, and so forth?
I think in an ideal scenario, you'd want to tailor it to that specific vertical or niche. But, I mean, I think what will probably happen, like, in most industries is that you will probably move around a bit in the space and think a bit of it. We'll start off with kind of high ideals of selling, you know, very, very focused bespoke package insurance to hairdressers, but what we might find ourselves doing is possibly something slightly different to that, maybe even more focused on professions or professional indemnity where people are required to buy the insurance.
But it's an exciting space for sure, and it's an unserved space. So it's a nascent space. You think there is a opportunity in the future. What kind of time frames are you thinking about in terms of when this becomes more and more realistic and, turning into premium? I think the challenge with all with embedded insurance in general is finding the right premium volumes.
I think you're obviously right to pick up on that question. I think we're obviously hoping that it's going to be instant. You know, we're hoping that it's we're going to find some big premium pools this year, but I think it'll probably be slow build up, you know, over the course of two or three years. I would suggest that many people are, you know, many founders of companies become more digitally native, and so over time, certainly, people will be looking to maybe buy their insurance, you know, in a more embedded digital way.
What about you? What do you think? Yeah. I'm still not 100% convinced whether it's, possible to sell into those vertical SaaS or other form of SaaS platforms. For me, the key question is that insurance intent close, the insurance purchasing intent close enough to the purpose or, of that platform that is trying to sell it?
Or is there a way you can, micro package or bundle the insurance into a subscription, into some other product. And I think if you manage to achieve either of this, I think that's how you can, achieve take rates. I think for me, like, with a vertical SaaS one, I think on paper, it's kind of the perfect kind of scenario. But actually, when you get into, like, anything in real life, there's obviously lots of complications. So one thing we find out with vertical SaaS is that, you know, they might be very focused on one element, so point of sale maybe or doing bookings.
And another thing as well is that the vertical SaaS companies themselves aren't necessarily focused on SME, like we found them where they, where their key clients are big companies, companies which you wouldn't sell to you know, in like, an online environment, which need to have, like, a proper risk managed broker, basically. So it's a it's an interesting space, vertical size.
