Listen In: Corvus Founder on Growing an InsurTech & More Insights
Corvus Founder and CEO Phil Edmundson sat down (virtually) with VentureFizz to discuss his business beginnings, innovation in insurance, and what makes Corvus successful.
If you’re looking to hear more on all those topics, plus paper route nostalgia, the early pitfalls of cyber insurance, and where insurtech can go from here, listen to the full podcast on VentureFizz.com.
In the meantime, we’ve pulled some of our favorite insights from the podcast to share while you find your headphones:
VF: Tell Us About Some of the Lessons You’ve Learned in Building a Business?
PE: I learned there’s a big element of trust in the commercial insurance business, and meeting people is really important. You have to like — and want — to get on the road. You have to reach out to people who have never heard from you before and share. What informs me at Corvus is an inclination I had before, which is to be very generous with what I know. People appreciate that. The openness I have always tried to use in my career is very present in the tech industry. Share the best practices and don’t pretend you’re so much smarter than everyone else — because you’re not.
VF: Let’s Talk About Corvus: How Did You See This Opportunity and Start Building the Company?
PE: There was an immense amount of opportunity in our business to use new forms of data, and tech enabled that data so that it could help us to predict and prevent commercial insurance claims. There are different types of insurtech companies, some of them focus on the servicing side, or automation or efficiency. Some of them focus on how to manage claims better, but we have gone after the biggest piece which is underwriting — more than sixty cents on the dollar is spent on the result of underwriting, which is claims. Understanding that aspect of the business and using data to better perform on those metrics, to me, seemed like the most compelling opportunity.
VF: What Was the Industry Like — Did They Have the Data and the Tools — When You Started Corvus?
PE: The industry was doing what I had seen it do with other new products. I’ve had a front row seat to how the insurance industry responds to new technology, and the way the industry did that typically was to look at the type of insurance that was closest to the new category of risk, overprice a lot, and offer very restrictive coverage. Even as recently as five or six years ago, cyber insurers were using very old fashioned techniques, applications that were modelled after other types of professional liability, but it’s really a combination of first and third party coverages. In any case, that’s where it usually resided in big insurance organizations. It was overpriced. Insurers were all running thirty percent loss ratios and making lots of money. No one was trying to use new data to improve the situation.
VF: What Areas Are Still Ripe for Disruption In InsurTech?
PE: There’s a lack of good digital platforms to share information with clients. Everyone buys insurance, but nobody likes to buy insurance. Commercial insurance is almost worse than buying personal insurance, because you don’t want to be the person that buys the wrong commercial insurance for an entire organization, especially if your claim isn’t covered. Buyers want benchmarking tools, scores, and advice. They want to make decisions better — and the use of data can be so prominent in this field. That alone —since I’ve worked running a brokerage firm — stands out to me as an exciting place to bring new technology.
Hooked? Click here for the full podcast!
The rise of remote work and growing concerns over ransomware acted as partners-in-crime to get organizations to hone in on risk mitigation efforts over the past couple years. Through compiling our Risk Insights Index, we found that with certain initiatives — safer or reduced usage of RDP, growing use of email security tools, and other measures taken to limit the impact of threat actors — businesses are more prepared than a year before and ready to play defense. Those efforts are borne out in our finding that the rate of companies who pay a ransom when attacked with ransomware fell by half within a year.
The whisperings of “firming rates” start first, quietly in business meetings, then published in industry reports. Soon to follow, rumblings of a “hard market” are brought to the conversation. It’s cyclical in nature, and we see it across all insurance lines at one point or another. For years, Cyber Insurance stretched far and wide with “soft” market conditions, remaining highly profitable. Now that period of growth, with exceedingly available coverage and inviting terms, has stalled in the face of a hard market.