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November 13, 2019

Modernizing home insurance to refocus back on the customer

Key Takeaway
The company says that finding the right talent and people to infuse their customer-centric approach has been the secret sauce to Hippo's success.

Oliver Wyman's Paul Ricard connects with Assaf Wand, CEO, Hippo Insurance.

Assaf Wand launched Hippo Insurance in 2015 with the belief that consumers deserve better home coverage. He recruited a team to leverage big data, automate the process, and modernize insurance for today’s lifestyles—providing coverage for items such as laptops and water leaks, instead of pewter bowls and stock certificates.

"Home insurance is a big financial investment," says Assaf Wand, CEO. “And I think there’s a place to build a new franchise in insurance, coming from the customer standpoint. Finding the right talent and people to infuse our customer-centric approach has been the secret sauce to our success."

Rather than plowing through daunting paperwork and a cumbersome process, Hippo customers can conveniently receive a quote in 60 seconds or buy a policy online in approximately 4 minutes. 

SO HOW DOES IT WORK? BIG DATA.

Hippo designed its customer experience around a simple online process. The company asks all the traditional insurance questions, but not to the policy holders or prospective customers. Hippo leverages big data to receive this information from verifiable third-party data sources, which is already pre-filled in when a prospective customer purchases their policy online.

For example, a prospective customer logs on and enters the address to their newly purchased home. The customer immediately sees the prefilled form detailing information such as how the home was built, the square feet and when the roof was made—specific information that customers who are looking for coverage don’t always know or have handy. Because its verifiable data this helps Hippo to reduce the friction of the questions and get better underwriting results.

Hippo realized that many homeowner insurance policies were written more than 50 years ago—covering customers for things that are no longer a part of today’s modern lifestyle. So, the company looked at this as an opportunity to modernize the coverage and offer policies that protect homes and possessions, such as computers, appliances and electronics, that consumers own today.

The company’s business model is different than traditional insurers. Hippo established partnerships with three major reinsurers, TOPA Insurance, Spinnaker Insurance and Canopius US Insurance, that have a combined $200 billion in assets and carry financial strength ratings of A- (excellent) from A.M. Best Rating Services. Hippo sells the policies and handles claims, while these reinsurers hold the risk. This benefits Hippo with the necessary capital and resources, while also ensuring coverage and reimbursements to its customers.  

Image Source: Hippo Insurance


A PROACTIVE APPROACH

The company says it takes a proactive approach—making sure it has an ongoing relationship with customers and mitigates a homeowner’s risk exposure as time goes on. For example, Hippo offers customers smart home devices to prevent potential issues before they happen. Hippo’s data can intelligently ping customers at the right moments—from a deteriorated roof or when it’s time to clean the gutters to water leak monitoring and service line (gas, water and sewer) coverage in the event of an accident or wear and tear.

WHAT’S NEXT FOR THE COMPANY

Assaf says that Hippo plans to add more products and services. The company started in home and condo and has expanded into investment property and builder products. Hippo also want to continue adding products that provide preventative maintenance for customers and mitigate a homeowner’s risk exposure. Items that when neglected, ends up costing thousands of dollars down the line in home repair.

 “For us, the ability to take care of our consumers if something bad happens, is something we care greatly about,” says Assaf.

 

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