On April 27, six #insurtech startups will pitched at the Global Insurance Symposium. RiskGenius will be posting a series of articles on the Global Insurance Accelerator companies. We look forward to seeing you in Des Monies!
Steve (Pablow’s CEO and co-founder) is an avid traveler, he’s been to around 50 countries, and loves the “buzz” of going to new places. His parents immigrated from Ireland to Australia when he was one, and he used to travel a lot with his mom when he was younger. Traveling is something he loves and feels comfortable doing. He’s been involved in travel technology for the last 17 years, and the last 4 years in travel insurance. He saw a gap in the way travel insurance is created, sold, and what travelers are actually wanting for their insurance. Traditionally, travel insurance is sold in a one-size-fits-all manner, so that it can be applied to a larger number of people, but oftentimes that isn’t what customers are actually looking for. Pablow is looking to change that via predictive analytics.
He’s had five start-ups in the travel industry, two were sold, the third a financial disaster but apparently a “visceral & valuable learning experience”, and the fifth one is Pablow. These companies are Carhire.com.au, VroomVroomVroom, Oodles.com, and tripcover.me.
The process for a travel distributor to sell insurance, would take 6-12 months. This is due to heavy licensing regulation, complex contracting and a high tech cost connecting to large insurance company systems. And for big insurers, its too expensive for them to reach small to medium distributors, in particular startups. So Pablow acts as a Plug & Play platform that helps big insurers and distributors to connect in a more cost effective way. They are a tech platform and independent insurance agent, with licensing, and retail capabilities to distributors, using white-label sites to sell directly to consumers and a proprietary algorithm that cleverly matches insurance policies to individuals needs. Pablow also inadvertently acts as a group buying service because they combine the total volume of their travel distributors, so the more volume they have, the higher negotiating power they have.
Steve is working to improve Pablow by addressing the lack of re-targeting capabilities. A lot of consumers, at the time of booking a vacation rental for example, don’t want a bunch of add-ons or advertisements. However, after they book, they are more willing to look at in context insurance. They created a re-targeting process based on a client’s need, and they now feed programmatic insurance offers in real-time into the confirmation pages. These offers are customized to what the customer’s needs will be on their trip, such as travelers, risk, and cancellation costs. Where they are from and where the travelers are going helps determine which policy to display and pricing for that insurance, all in real-time.
They are B-2-B-2-C. Which means that they design their product with the customer in mind, but Pablow’s target market is existing distributors. Vacation rental system providers and vacation rental retail sites are their initial go-to-market targets. Travel agencies and airlines could potentially use their services, but they are focusing on the vacation rental market for two reasons: Firstly it’s a very fragmented with smaller players who aren’t in a position to get insurance licensing in all 50 US states, and secondly the vacation homes are pre-paid and are non-refundable, which creates a big cancellation risk for consumers, so as a result their highest selling insurance is the cancellation protection.
This year Pablow is working on their algorithm (Pablow Cubed), which is the brains of the policy to customer matching, and then their re-targeting product (Pablow Reload) which is in pilot. Pablow reload runs the re-targeting program. When you have shopping cart abandonment, they have a retargeting campaign that gets launched on Facebook, social media, throughout the web and email to remind the customer about the product, tracked through cookies. Pablow Reload is being run as a pilot program over the next 1-2 months with several vacation rental distributors, and then will likely be released more widely in the second half of 2016.
Pablow Cubed picks the correct policy and then Pablow Reload will advertise it. Experience shows that conversion rates and value increases the more personalized the product is. That is their real return on investment. Their roll-out strategy involves going into the U.S. market, European market, Asian-Pacific market, then Latin-American market, with the intent to go global. Global expansion is key to being able to offer their insurance policies to different places all over the world due to licensing restrictions. Many travel distributors already sell their products to ‘anyone traveling to anywhere’, and they need an insurance partner who can support such geographical diversity with simple and smart technology.
One challenge Pablow has faced is the costs of licensing, and jumping through the hoops necessary to become licensed in all these different countries. For example, Steve took and passed insurance exams in the U.S state of Iowa, only to learn afterwards that he couldn’t actually get the license without a U.S social security number, and a U.S work visa. And to top it all off, he then found out that licensing was also required in the other 49 U.S states, for not only himself but his company too! That has all been resolved now but it certainly was a learning curve for him, in terms of timing, budgeting and regulations.
Pablow was in the 2015, Global Insurance Accelerator. He said that he joined because he believes “as a startup you need to go to the biggest market to have big impact”, and therefore wanted assistance in incorporating in the U.S. market, and to get a supportive environment for the legalities of starting his business in the U.S. He met with the insurance commissioner in Iowa who gave him some good advice. He also likes Iowa because it is affordable, and there is support from the local government.
For this article I interviewed Steve Sherlock, Founder and CEO of Pablow
Pablow | Berlin, Germany & Gold Coast, Australia | www.pablow.com