Insurtech and the Start-Up Nation: Navigating Innovation in Israel’s Insurance Ecosystem
The intersection of insurance and technology – insurtech – has resulted in a multitude of opportunities and successful start-ups, so many of which have been developed in Israel, the “start-up nation.” Kobi Bendelak, CEO of InsurTech Israel, an insurtech accelerator, joins Eli Azoulay, Vice President of Business Growth at Sapiens, for a discussion on Israel’s critical role in the rapid growth of insurtech technology, why it is such a fertile ground for innovation, and how Sapiens continues to play a part in the industry’s remarkable expansion.
Eli Azoulay|Kobi Bendelak
Eli Azoulay: Hello, welcome to the Sapiens Insurance 360 podcast. I am your host for today, Eli Azoulay, Vice President of Business Growth at Sapiens, and I’m so glad that you are out there listening. This is where we discuss the latest news, trends and issues from across the insurance solutions and technology spectrum.
The intersection of insurance and technology – insurtech – has resulted in a multitude of opportunities and successful start-ups in the last decades, so many of which have been developed in Israel, the “startup nation,” that fosters both incredible innovation and so many insurtech pioneers. How has Israel become such a hotbed of insurtech? And what contributes to its ongoing success? And how does Sapiens continue to play a part?
So to answer these answers questions and more is today’s guest, Kobi Bendelack, CEO of InsurTech Israel (ITI), an insurtech accelerator that helps insurtech startups and companies reach relevant international markets through mentorship and support from parties and brokers.
Kobi, thank you so much for joining us on today’s program!
Kobi Bendelak: Thank you, thank you Eli, and thank you Sapiens for having me here! Thank you very much. Looking forward.
Eli Azoulay: So Kobi, let’s start with basic questions. Talk to us about the Israeli insurtech system and ITI.
Kobi Bendelak: The Israeli Insurtech ecosystem is a very flourishing and active ecosystem. Eli, do you have in mind how many insurtech startups we have in Israel?
Eli Azoulay: No.
Kobi Bendelak: Let me help you. So it’s almost 200!
Eli Azoulay: Whoa!
Kobi Bendelak: So, yes, it’s a very flourishing and a huge ecosystem. We just arrived from a roadshow in the Midwest, in the US Midwest. And I tried to describe how it looks like that we have about 200 insurtech companies, with a lot of great solutions in there. High level, this is the Israeli Insurtech ecosystem — very flourishing and very, very, very active.
Eli Azoulay: Thank you for that, Kobi. How are Israeli Insurtech startups or existing organizations collaborating to drive innovation in today’s insurtech ecosystem? And please tell me how Sapiens’ continues to contribute?
Kobi Bendelak: For us, the Israeli insurance let’s say ecosystem company here in Israel is startup focused. The Israeli insurtech startups focus in on the target markets. I’d say like it’s [the] US and Europe. So for us, being a part of the global activity at Sapiens is desirable. It’s a great opportunity for us to grow and to accelerate our activity around the world. And Sapiens is really evolving that.
Eli Azoulay: I can share with you that I’m personally [participating] with the startups that you are bringing [at] every round, and they are amazing. Fresh ideas with unique spirit, and it’s an honor for us to support this scene. I mean, really amazing, amazing, amazing.
Kobi Bendelak: Thank you!
Eli Azoulay: So could you highlight for us some notable success stories or innovations that have emerged from [the] Israeli insurtech scene? And from ITI’s support?
Kobi Bendelak: Of course. So let’s start about speaking about the success stories. So first, any successful ecosystem needs to have success stories to attract partners, to operate, to be part of the ecosystem. And we have very great success [stories] in our ecosystem. So Lemonade and Hippo and Next Insurance are part of our ecosystem success story. There’s some people that don’t know that Lemonade, Hippo, and Next Insurance are Israeli-based companies. They started here and now they’re operating abroad. But in the beginning they started here and this is a very great success story. So but we are speaking about this one or the startup that’s operating now in Israel. So I can mention two great success stories as well. So the first one is Binah. Binah, it’s a great startup using a video capture to see and understand what is your health condition by just taking a short, quick video of your face, we know exactly what is your blood pressure, stress level, diabetic, and a lot of information about you. All of that information is very useful for the insurance industry. First for underwriting that’s for sure. For better underwriting, they know exactly what is your client’s health. That’s one thing. The second thing is wellness and prevention. So they can prevent from damages or they can assist to prevent damages or losses for in the future. And the last thing is retention. Every insurance company wants to keep their clients in. And you don’t know who is your new client when you start life insurance, or when you have a health insurance client, so you don’t know that exactly. So by using the Binah application, the clients can update the insurance company about their health. And if you are using Binah, the clients can keep going with the discounts that we are receiving. So the discount can protect your clients. Retention is a great tool, Binah is a great tool for retention. So this is one success story.
The second thing we can say is Atidot. Atidot is a great tool for life insurance. They develop a solution that [an] insurance company can understand, better understand [your] clients expectation about tension, about paying the premium, about a lot of things that can give you insight about your clients and assist you to keep the relationship with your life insurance clients even better. So these two great tools are very great success [stories]. And I know that Sapiens was involved [with] that company and the system to operate around the world.
Eli Azoulay: That’s brilliant, Kobi, really brilliant. So looking ahead, what trends do you foresee shaping the future of the Israeli Insurtech ecosystem and how ITI and Sapiens partner together to help shape it and even export its innovation platform globally? I know, many questions together, but I guess we’ll manage it.
Kobi Bendelak: It will be okay. I will try to manage it. So let me surprise you, GenAI.
Eli Azoulay: Yeah.
Kobi Bendelak: I don’t think there is any person around the world who didn’t hear these two words. It’s a buzzword, but it’s not actually, it’s not a buzzword. It’s really amazing technology that will improve the insurance world. Let me a little bit describe it in a wider view. So I think until last year, we can split the period of what we call the generation, the Insurtech generation. Until last year I think so, of the insurtech industry, we call it the Generation 1.0, meaning the insurance industry or the insurance company [started] to digitize themselves. I think the majority of the insurance companies around the world are digitized.
It’s some, some are deeper involved, some are less involved, but the majority of the insurance companies around the world use digitized tools to engage with their clients. So that’s one thing that happened in the first generation. The second thing is index, that the insurance companies [need] start to index themselves, collect all the data from all other sources that they implement in the insurance companies, the systems, and they have better understanding and a better approach to web data.
So that was the first generation of insurtech. And it’s until last year, I think that’s the majority of the tools that the insurtech industry developed for the insurance world. Since then, we jump for a new generation. It’s, we call it the insurtech generation 2.0, meaning using the data, using the digitalization that the insurance company already [has] and trying to improve the insurance industry by using different tools and especially different products. And just to give you an example, because of the technology we can use now, a new kind of a product, it’s called parametric insurance. So instead of having the traditional flow of having insurance by insurance, something happened, and then you will claim and the process is a very long scale. The clients don’t like it. Instead of that, parametric insurance [does] it differently. So instead of waiting for the claim and then claim when claim happened, the insurance company will pay you automatically, because they can assist what’s happened by digital tools and understand [that] the claims happened and pay you immediately, in seconds. I can give you an example. It’s something that maybe the audience already knows. It’s the cancellation, the flight cancellation policy. So if the flights are canceled, insurance [companies] know that immediately for this for the flight for the airline systems and they will pay you immediately the amount of the money that you need to get or if your servers stop working or if you’re using an Amazon platform. But for me, it’s not working. The company knows exactly what’s happened and gives you the amount of the money that you owe to be protected by them immediately. So this is one kind of of product, but there is many more product that came for the next generation of Insurtech that we have started, I think last year.
Eli Azoulay: Definitely amazing what’s happening here. So before we are the ending, I just want to tell you that I can speak for so many companies and people and to say that we cannot wait and see what’s coming next from the startup nation. I think that a lot of companies think thanks to you and on the ecosystem, I know I speak for so many when I say that they can’t wait to see what’s coming next from the startup Nation. So thank you, Kobi.
Kobi Bendelak: Thank you very much.
Eli Azoulay: And to our listeners, thank you so much for spending your time with us today. We love hearing from you. So if you have comments or would like to follow us on the social media, please reach out to us on our channels and don’t forget to subscribe to our podcast. Thank you once again for listening. We’ve got more coming, so stay tuned to our Sapiens Insurance 360 podcast.
