‘Money is available’ – Insurtech UK CEO Melissa Collett’s funding mission for members
Insurtech UK CEO Melissa Collett is fighting hard on a range of issues so its members can remain global leaders of innovation.
Winning Government-backed funding for UK insurtechs is a top priority, says Insurtech UK CEO Melissa Collett in the latest Voice of Insurance podcast.
Collett says there is ‘money available’ for UK insurtechs to win, especially as the Government has outlined the UK insurtech sector as a priority for growth.
Money can come from Innovate UK, part of UK Research and Innovation, which is a non-departmental public body backed by the Government.
It hands out grants to successful applicants.
Speaking to podcast host Mark Geoghegan, she said: “Insurtech has been identified by Innovate UK as an area for growth and the UK economy.
“So there is money available. And what we’re trying to do is highlight the availability of this R&D (Research and development) funding to our members so that they can apply. It’s competitive, but they can access this funding.”
Collett said Insurtech UK was also working closely with the ‘really keen’ Department for Business and Trade.
Collett said: “It’s not just Innovate UK, but the Department for Business and Trade is also really keen to promote insurtech as an export, as well as something that also attracts companies into the UK market.
“So it’s something that we’re working very closely with the department on a number of ventures in various parts of the world, because this is really seen as a growth area.”
Although the funding is an important part of Insurtech UK’s mission, Collett said the broader mission was to ‘make the UK a global leader for insurance innovation’.
She stressed that the UK has the highest number of insurtechs in Europe and is second only to Silicon Valley in producing unicorns.
A big achievement for the trade body has been the strengthening of ties with the US through the ‘UK Connecticut Insurtech Corridor’.
The partnership aims to remove barriers faced by UK insurtechs when expanding into the US, and vice-versa for US insurtechs looking to the UK.
Geoghegan said Connecticut had Hartford at its heart and ‘was one of the beating hearts of the US industrial revolution and the US insurance industry’.
Collett said: “So far, I believe, 11 of our members, so that’s almost more than 10% of our members, have already made use of the Connecticut corridor, and are using it to establish operations in the US. So we just want to continue building that.”
Questioned by Geoghegan on other issues Insurtech UK was working on, Collett outlined capacity, tax and FCA authorisations.
Collett said ensuring insurtechs have access to capacity arrangements is ‘vital’, something which can be a struggle for insurtechs.
Another pressing issue was on tax. There was a subset of companies that can’t reclaim or offset tax that other larger companies can, meaning ‘they are being slightly penalised’, she said.
Elsewhere, authorisation of insurtechs has been ‘incredibly slow and difficult’.
She said: ” That’s something we actively lobbying about. Because it is really important that the PRA (Prudential Regulation Authority) understands the difference between a big insurer and a small start-up.’
Artificial intelligence has been one of the most relevant topics to hit the insurance industry in recent years, stated Geoghegan.
Asked about the issue, Collett said the body had concerns over ‘bias in algorithmic decision making’.
However, 2023 was the ‘year of the AI governance’, with the Prime Minister Rishi Sunak wanting to be a world leader on governance.
Collett said: “I think that AI governance or responsible AI or whatever you want to call it ethical AI is now very fully on top of the agenda. And that’s why I think that people being conscious of bias is now got a much better chance of eliminating or reducing that bias than before where it was just unconscious bias could creep into the decision making.”
Collett highlighted the benefits of AI, stating members were involved in using it by ‘harnessing the power of the technology’ to improve customer experience.
Wrapping up the conversation Geoghegan asked how insurtechs could get involved with the trade body.
Collett said: “We absolutely welcome anybody working in the insurtech ecosystem to join us. And there’s a way of joining us, no matter who you are.
“Whether you’re involved as a partner, you can get involved if you’re providing legal consultancy, accounting, whatever services to ensure tax. Join us as a partner.
“If you’re an insurer, broker, a more of an incumbent in the market and reinsurer join us as an associate. And as an investor, we’re actually coming up with an investor membership model as well. So basically, we want to welcome anybody who wants to meet the insurtech ecosystem in the UK.”