Insurance as an API

There are moments that transform industries. Inflection points in which the future is less certain, yet everything feels newer. Insurers are in an industry that is undergoing one of these shifts right now. As technology invades a historically slow-moving industry, new possibilities are opening up and new opportunities are being presented. I believe that insurance is going through an “AWS Moment” as insurance products themselves become API-enabled.

The most widely-known use of API’s within insurance is for quoting. Online quoting has been the obsession of the industry ever since the pandemic started, for obvious reasons. The pandemic accelerated a long-term trend of consumers preferring to purchase online and interact with humans less. Very few insurance companies were prepared for this and it has become the #1 focus for many.

But Insurance as an API is a relatively new concept. It is the idea that not just quoting but the entire policy lifecycle is available for external consumption. A handful of pioneering companies are just starting to roll it out, with remarkable results. The companies realize that in order to be dominant in the next phase of the insurance industry, they have to relinquish control of the customer to the companies that already have them. Vetting partners is certainly important, but if you connect with the right partners the opportunities are enormous.

If you can expose Insurance as an API, you are effectively making your entire product–and the business processes behind it–available to the outside world to use. It is a foreign concept to many insurance companies at this point, yet it is widely understood and used in many other industries. Because of it, you can start to embed insurance throughout all kinds of consumer touch points and sell through all kinds of new channels ranging from software applications to supply chain distribution partnerships.

Insurance as an API allows third parties to use their unique data to deliver quotes within their own customer experience, and even provide an integrated buying experience. (This is more commonly known as “embedded insurance”) It allows coverage choices to be tailored based on the unique knowledge of the customer, who they are, and their risks.

Insurance as an API allows the servicing of a policy–including claims and billing–to start to use modern customer service tools: conversational AI, advanced call center systems, and marketing automation tools. This results in lower expenses, happier customers, and higher retention.

Insurance as an API allows for adjacent types of products to be easily incorporated into the customer experience. From specialized risk improvement to premium financing, the insurance “package” becomes more useful, easier to consume, and becomes more accessible to a wider range of customers.

But perhaps most importantly of all, Insurance as an API provides exponential speed. By packaging the product within easy-to-use API’s, companies are able to lean on partners and not exclusively on their own internal ability to craft the best customer experience and reach the entire market. Again, this is perhaps a foreign concept to most insurance companies, yet history has generally proven this to be a smart approach, and the first movers are benefiting from many opportunities not available to others.

All of these things are not guesses–these are the same dynamics that have played out over and over in different areas. When Amazon launched AWS, for example, the entire hosting and development industries saw these benefits, and the entire industry had to react. We’re now in the process of experiencing an industry-wide shift to ensure that all business processes are supported by APIs, and easy to consume by whichever partners need to use them. The ability to play in this arena will determine who wins and loses for the next several decades.


The new insurance tech stack

Historically the Insurance industry has been slow to innovate, but COVID flipped the script. The innovations that used to set companies apart (Api’s, quote-to-bind, marketing automation, etc.) are now business requirements, and innovation has moved into new areas.

The role of an insurance company is changing. Increasingly, insurance companies are in the business of collecting data about their policyholders and then distributing that data to multiple internal and external stakeholders. Internal stakeholders being actuaries, underwriters, and claims adjusters. External stakeholders being policyholders, agencies, regulators, and TPA’s.

It’s worth exploring what this means to companies and agencies. A focus on data distribution and coordination fundamentally changes the role of the insurance CIO/CTO. A role that has historically been focused on vendor selection and implementation projects is now forced to consider data flows and platform architecture, and it puts enterprise architecture at the center of the equation.

A technical leadership role that has historically been focused on vendor selection and program management is now forced to understand and plan for data flows and platform architecture

The toolbox for insurance companies going forward does not look like the enterprise architecture of yesterday.

The new toolbox

Instead of monolithic core systems that handle everything, CIO’s and CTO’s are increasingly looking outside of traditional vendors for key capabilities. The services in the toolbox for most insurance companies new include:

  • CRM — there’s always a source of truth for the customer, and the CRM is usually it.
  • Marketing automation — Hubspot and the like are often used for automated customer outreach, and sophisticated companies are using marketing automation for ALL services (including for claims and billing). 
  • Quote-to-bind (that’s us!) — You need a way to turn traffic into policies with a great customer experience. Should be able to sell any product you have to any channel you want to leverage.
  • Billing — invoicing, payments, endorsement reconciliation.
  • Agency management — agency codes and commission management.
  • Policy engine — your source of truth for the policy, usually lives inside of a policy system but in reality should be an independent service (stay tuned for some exciting news on this front).
  • Certificate management — getting policyholders and others the documentation they need.
  • Claims handling — the customer experience to make the best of a bad time for any policyholder.

Now there are a couple of additional items required which every company needs as well:

  • API’s — for any company with plans for digital distribution, this is a must. This is your technical front door to the rest of the world, and if it’s impossible to open or non-existent, you should not expect to get in.
  • Identity management and authentication — to connect all of these components, there is a layer of identity that every company has to own somehow. In order to create a cohesive user experience across all of the other services, this is key.
  • Analytics and data lake initiatives — with multiple services comes the challenge of bringing all of that data together in a usable format. This is they key to unlocking the latent potential in all of the data being collected. There are some incredible new tools.*

* This is especially interesting because there is so much room for disruption insurance that comes with free and open data flow.

The build-or-buy ship has sailed. Very few companies have an appetite for building large pieces of software internally, even fewer are successful at it. There are exceptions, but they are typically niche carriers or new MGA’s who are starting with a green field. Prebuilt components will provide richer data, a better experience, and infinitely faster time-to-market than something built in-house, when that’s possible.

Technical experts at carriers and agencies are being forced to quarterback a platform architecture and strategy, selecting and then connecting the dots.

BUT… can they?

A platform is the wiring for all of these capabilities. The identity management and authentication, authorization, and the data all make up the infrastructure, the substrate upon which microservices are wired together, and then user interfaces are placed on top of them.

Many companies now are focusing their technology groups on selecting these core components and then quarterbacking the process of plugging them in.

The most advanced companies, at least within insurance, are also developing some of their own specialized services–typically to support differentiation within their market niche.

Hopefully, if you’re in the insurance industry, you have a plan for this that you’re already executing on. If not, you should talk to somebody who’s already doing it.

But if you are, the future is exciting. This all leads to composable business models… up next!


At Uptake I was on the team that investigated insurance. I fell in love, and ended up starting Dais to bring technology into the industry.


Small Commercial Insurance Trends In 2021

Despite the pandemic, small commercial is incredibly hot right now. Most likely this is due to an increased focus on bringing offline processes online, and this is the lowest-hanging fruit available in the small commercial space. 

This has been a busy sector of the commercial P&C market in the last 9 months. Let’s take a look and see what’s happening in this space.

Nobody wants to touch it

The key to small commercial profitability is that you can’t touch it much or it becomes unprofitable for a long time (because the premium is so low). So there’s a real advantage in being able to provide a great customer experience in a scalable way.

Some carriers are seeing success in setting up service centers for agents and retaining a few points in commission for the service. Some agents are automating it themselves.

Carrier portals left behind for API’s

The trend around five years ago was to set up a carrier portal, often focused on ease of use. There was a huge first mover advantage in this, and the carriers that were able to move first enjoy a stickiness that is almost impossible to replicate for newcomers.

The late adopting carriers who set up carrier portals later are finding that change management at agencies is hard and adoption of their carrier portals is harder still. Changing the behavior of CSR’s is incredibly difficult, and most agency CEO’s struggle to do it effectively.

The first movers are happy with the current situation, everyone else is now scrambling for a solution. And all roads lead to API’s to connect to digital distribution.

API’s becoming table stakes

Everyone is connecting to API’s. There are many companies out there who connect to API’s to provide what is effectively a comparative rating service to agents. Most notably, agency management system vendors. And when these agency management systems have the ability to connect natively, it will challenge the small commercial rating systems to provide value outside of simply a connection to get a quote. 

Either way, it will be a race by the carriers to connect the distribution systems with the most flow to sustain growth. Industry API standards are sure to emerge, and carriers that can’t adapt quickly will see their premium volumes quickly dwindle.


Amidst the rush to automate everything, the best agencies are focusing on specialized programs based on unique data and strategic partnerships. They are being opportunistic and finding partners with large groups of policyholders, usually in a specific class, and creating a great customer experience specifically for them.

The most sophisticated agents are partnering with distributors, associations, retailers, and others to get access to proprietary flow as well as proprietary data sets (schedules, account history, activities, etc).

New MGA’s are dominating SEO and online marketing

The first movers in online marketing were, not surprisingly, startups. MGA’s and niche carriers have enormous head starts on traditional agents and carriers, and are making it difficult to compete on customer acquisition costs for new entrants and carriers.

Automation and API’s are slowly creeping up-market, into middle-market

Automation and API’s happened first in middle-market. Then they came for small commercial, and are eating it one class at a time in many carriers. Carriers that have already automated a BOP are moving to work comp, and those with automated work comp are automating commercial umbrella. 

The march towards automation will continue until the simplest lines of business have all been automated, and this needs to be considered in every carrier’s strategic planning.


The data edge in insurance

I’ve had the pleasure of being in a few different industries now: call centers, industrial machinery, and now insurance. It’s always interesting to try to observe not just the differences between them but also their similarities. Specifically, the similarities in how these different industries are incorporating data into their vertical stacks.

Within insurance, data has probably a more direct impact than any other I’ve seen because it’s based almost entirely on math, at the end of the day. You have to take in more than you pay out.

Here are a few areas where there is just so much potential for data in the insurance industry, and some interesting things different people are doing with it.

Using data to underwrite better

Boils down to taking more good risks than bad

  • classic data science application, write algorithms that are smarter
  • finding completely new sources to use such as drones, sensor data, and social media profiles
  • partnering with third parties who have exclusive access to useful data including personnel histories, vehicle location, business profitability, and more

Ultimately all of those come

sources of proprietary loss data


  • Lack of a process for figuring out how to use new data sets
  • Getting new data sets into a data lake

Using data to simplify insurance for the consumer

Prefill data etc

Using data to simplify insurance for the consumer


Digital agencies are the future of insurance

Selling mattresses used to be an incredibly capital-intensive proposition. You needed real estate, a storefront, stock in the store and salespeople. Only a few chains of mattress stores and department stores sold them.

Then, the Internet happened.

When the now-giant mattress company Casper launched in 2014, they took advantage of the fact that a brick-and-mortar store is no longer required to sell to customers. A massive physical presence is no longer a requirement to compete in a market, meaning that Casper could immediately come in and compete with mattress and department stores, without the massive capital investment required to compete in the market with physical stores.

Today, six years later, they are the 7th largest mattress retailer in the country.

The Internet has been doing this for years — knocking down barriers to entry and letting innovation flourish. The tools that Casper used to break into the mattress market in a big way are available to everyone. And that’s the history of the Internet in a nutshell: it makes opportunities that were previously only available to few now available to many.

And it’s happening in insurance next.

The digital tools that used to only be available to VC-backed startups who invested millions to build them are becoming available to all agents. And it’s turning the insurance industry inside-out. The ripple effects will be felt for decades

To be clear, insurance agents are never going away. They are the experts who help the average person or business owner properly buy insurance. Most people wouldn’t make decisions on their investment portfolio any sooner than they would try to remove their own appendix. And insurance is the same way: it’s a complex product that requires training and experience to buy and sell intelligently.

The problem is that right now, most agents don’t have the technology to effectively meet the needs of consumers who are accustomed to delightful online experiences. They have the personal piece down pat, but this is only half the battle. The future requires a human touch augmented by technology to remove frustration, redundancy and unnecessary work from the process. The future is better.

The real threat is that the existing agency system is incapable of adapting fast enough, leaving insurtechs and direct-writing carriers to step in and take all of their customers. Agency independence dwindles, leaving customers with fewer choices and a poor customer experience.

Fortunately, the Internet is once again intervening.

Digital agencies are the wave of new technology-enabled insurance agents who have a digital customer experience and workflow to support their customers in the way they expect to be supported, while retaining that human element and expertise that is irreplaceable.

Image for post

Digital agencies are freed to be more creative with their marketing and advertising, selling into specialized niches to deploy their expertise much more freely. They interact with connected carriers who make their products available to digital agencies to sell through their digital tools.

Digital agencies still have the same people who power the insurance industry today: producers, account managers, claims advocates. Only now, they are augmented by technology that helps them scale to more customers and more segments without missing a beat.

Image for post
Digital agencies and connected carriers need each other
  • Digital agencies are universally connected to their policyholders and their carriers. This allows information to flow back and forth in real-time so that customers aren’t waiting on manual processes to complete to get the end result.
  • Digital agencies own the customer experience and are the face of insurance to the customer. They don’t hand off digital touchpoints to carriers or anyone else. They control their own destiny and their own customers.
  • Digital agencies optimize their book by up-selling, cross-selling, and interacting with their customers more regularly and in an automated way. They step in when and as-needed, and otherwise let their technology manage the day-to-day logistics.

What this means is that digital agencies are freed to do what they do best: sell insurance. Agents should be creative, thinking outside the box about new and better ways to reach their current and potential customers. They should be inventing new vertical specialization and sales programs and using that to drive their growth both internally and with their carriers.

This is literally happening right now. At the Internet of Insurance, we are bringing world-class technology to independent agencies, starting in Minnesota and Wisconsin. The type of technology that used to be only available to a handful of insurtechs is now available to Big I members in those two states and, soon, across all 50 states.

When the digital tools that used to cost VC-backed startups millions to build become available to every agency, what happens? Digital agencies and connected carriers create the ability to sell insurance cost-effectively, in differentiated ways, with a great customer experiences changing the insurance distribution landscape