The UK has a successful and rapidly growing data-driven insurtech sector. Finding new ways to use data and technology to transform this multi-billion pound industry is helping insurers and brokers improve product offerings while reducing costs. Percayso Inform is pioneering new ways to use data from multiple sources to drive innovation for their clients across the insurance sector. This interview with Richard Tomlinson, Percayso Inform’s Managing Director, offers insights into the competitive advantage which data offers for insurance innovation.
Martin: Could you give us a brief overview of what Percayso Inform does and why it was founded?
Richard: Percayso Inform provides next generation insurance intelligence services to insurance providers from long established businesses to start-up insurtechs to reduce fraud, claims and cancellations whilst increasing conversion, retention and cross sell opportunities. We do this by accessing the best and most relevant data sources and working with our clients to provide bespoke solutions which are able to drive a clear pricing advantage across their distribution network.
Percayso Inform was founded to shake up the insurance data enrichment sector to provide a dynamic, flexible and bespoke alternative to the incumbents.
Our founder’s vision was to bring to bear new data sources, accessed in new ways which deliver a step change in predictive capability alongside entirely new solutions and international expansion.
Martin: Percayso Inform uses data to help brokers and insurers price their products more effectively. How do you source data for this?
Richard: We have a long list, that is growing all the time, of carefully vetted data suppliers from the credit bureaux to specialist insurance data providers by insurance line, for example motor or household, and by data type. Each provider and the data they supply go through a detailed due diligence process to ensure that the service is compliant, accurate, predictive of insurance outcomes and can be accessed in appropriately speedy timescales.
Ultimately, the data has to add value to our insurance clients’ pricing – that’s the ultimate test.
Martin: In a world where data is becoming a commodity, how does Percayso Inform help its clients achieve a sustainable competitive advantage?
Richard: In three main ways:
- New data sources that have not been used before– there are niche and new data sets being built up and created all the time, typically by businesses that do not have the analytical ability, the technical integrations or the distribution network to effectively deliver them to the insurance industry – so we find that data partners often approach us.
- Using existing data sources in new ways and in combination. Using the latest data science techniques employing machine learning and AI we are able to ‘squeeze more juice out of the lemon’ – by that I mean drive more value by using the data in ever smarter ways.
- By providing a bespoke service– too many insurance providers have become content to take off-the-shelf data product sets and deploy them in unsophisticated ways. At best, this dumbs down the power of the dataset and, at worst, it can actually be detrimental to their pricing, their business and their customers. Percayso Inform is all about working with our clients to ensure they really understand the data and how it is best used to increase retention, improve profitability and win new business.
Martin: Providing data-driven solutions to customers allows for more innovative business and revenue models than more traditional businesses. What is Percayso Inform’s business model and where does the company sit in the insurance value chain?
Richard: We are very flexible when it comes to commercial models and are able to entertain a broad spectrum of options including flat pricing, volume based and even risk reward. At the end of the day whatever we do has to provide a substantial ROI for our clients so we work on a model that will deliver that with each.
Where we sit in the value chain will vary depending on the client, our relationship and the solutions we provide. Sometimes we are strategic partners delivering an enterprise solution at the top and sometimes we are content to simply deliver an individual dataset for a specified purpose.
Martin: How do you see the role of data in the UK insurtech sector developing over the next few years.
Richard: I see this as the engine for innovation and growth and the spotlight from the big players will be firmly on this sector. The big players are unable to truly innovate for many reasons of scale, legacy tech, processes and simply having too much to lose. The insurtech sector is able to move much more quickly, test and learn, go from concept to delivery in weeks rather than years and as such I believe will take up an ever-increasing share of the UK insurance market in the next 5 years.
Martin: You recently raised £436,000 from equity crowdfunding. Why did you adopt that approach to raise investment and how did you find the experience?
Richard: We took this approach for a few reasons:
- To build awareness– as a relatively new business it is always good to get the word out and ensure the market knows what you are about. We have had a lot of press and social media coverage on our raise and as such have been proactively approached by a number of new investors, clients and potential partners.
- To bring on board a broader set of investors– we have brought on board an additional 274 investors as part of this round and they represent a broad profile – insurance insiders, technology experts, professional investors as well as existing clients and partners and as such we have a much more balanced investor base who have effectively become our evangelists. As investors, they are much more likely to recommend you, make connections and introductions and generally amplify your message.
- It’s good discipline– the process you go through, both because it is FCA regulated and also in the public domain, means that it’s really important that you show the best (and of course accurate) view of who you are, what you have achieved and where you are going. Everything has to be both evidenced and at the same time compelling to the audience so I think it has really helped us to syntheses the message into something that everyone can appreciate and understand how we deliver value for the insurance sector.
The positive impact on our team as a result of the raise shouldn’t be underestimated either. To have been able to attract the interest of a wide range of investors who are excited by what we are doing and want to become part of our journey has given us all a huge energy boost. Having also been recognised as a business that is well positioned to help insurers succeed with our inclusion in the 2021 InsurTech Impact 25 compiled by Oxbow Partners, we’re all fired up to take the next steps in our development as a business, including expanding our geographic footprint beyond the UK. We’ve got a busy but exciting year ahead!