The sharing economy is transforming the way we use our assets – and the way we live day-to-day. As this transformation happens, there will need to be changes in lots of associated industries. One of those affected is insurance – for which London is already a global centre.

This transition is all part of the current digital transformation of the insurance industry – termed “insurtech” (or insuretech, depending on whom you speak to). You might think of insurance as a dull sector – full of old men, and stuck in centuries-old traditions. But right now, this industry is being shaken up by a new generation of tech-savvy entrepreneurs. This is a huge, once-in-a-century opportunity for UK investors to capitalise on the transformation of this traditional stalwart of the British economy.

I’m sure you’ll be interested in learning how to take advantage of this rare investment window. Today, I’m talking to an entrepreneur who could potentially help you cash in on the twin booms of the sharing economy and insurtech. Janthana Kaenprakhamroy, from a startup firm called Tapoly, is giving her thoughts on how the insurance industry can support the new gig economy.

AL: How long have you been working in insurance?

JK: Actually, not very long. I began my career in investment banking, and then worked as an auditor for the likes of UBS, Deutsche Bank and JP Morgan. It was only last year that I decided to switch careers and create Tapoly – to address what I saw as a serious gap in the insurance industry.

AL: What brought this gap to your attention?

JK: I decided to let my spare room on Airbnb. Being an auditor, and thus trained to spot risks, I realised I needed insurance. My existing home insurance didn’t cover commercial risks, so I looked around for some short-term supplementary insurance cover for my letting activity, and I couldn’t find any! All the insurers I spoke to either didn’t offer it, or could only give me an annual commercial policy, which was quite expensive. Given the growth of Airbnb, and other sharing economy sites, I realised that there must be lots of other people in my position – and that this was a growing problem.

AL: So your aim with Tapoly is to provide short-term letting insurance for Airbnb?

JK: That’s how it started. But then I did some research, and realised that there was an even bigger market gap out there. Did you know that more than half of all freelancers are working without any work-related insurance? This means that they could end up losing their home, if an unhappy client sues them. And the proportion of freelancers in the workforce is predicted to rise dramatically over the next few years. That means a massive number of people being underinsured, and that’s what Tapoly is here to address. We will provide everything a freelancer might need, insurance-wise.

AL: What kind of technology are you using to provide this service?

JK: Our entire platform is digital, delivered via a website and mobile apps. We automate as much as possible, allowing us to deal with high volumes of requests. If a freelancer is working on short contracts, and only wants a day’s cover, that’s no problem. They will be able to log into the platform and buy a repeat of their last day’s cover at short notice – and it’s all very easy. At the moment we are still using human actuaries to create our pricing models – but in the future, we plan to use machine learning. This change will mean we can rapidly adapt our pricing to meet fluctuating demand, and cope with any changes in market conditions. We also are looking at using AI-driven chatbots to provide a more fluid user interface for first-time visitors to the site, so they can investigate the types of insurance available to them and make an informed decision. In addition to that, we are investigating Internet of Things (IoT) and telematics, which could help us detect and validate claims. However, all these technologies are still too early-stage for broad adoption. They are currently too expensive for startups to implement.

AL: Doesn’t insurance require a lot of capital?

JK: We’re not carrying the risks ourselves – we are following the MGA (managing general agent) model. This means that we partner with existing insurance companies, who provide us with risk capacity – while we handle distribution and customer service.

AL: What do you expect the future to hold, for your firm?

JK: We have big plans for Tapoly. After gaining a market presence in the UK, we are going to move into Europe, preferably before Brexit, since that would make the regulatory issues easier. We have a lot of good contacts in Germany, and Munich is up and coming in the insurtech world, so that’s probably where we would go first. The sharing economy is global, so that’s where Tapoly is ultimately ed.

AL: How can readers invest?

JK: We’re currently partway through our seed funding round. The money we raise will allow us to access additional risk capacity, broaden our product offering, and expand our operations more quickly. So far, we have commitments from investors for 40% of our £250k target – so there is still room for more investors to participate, and play their part in Tapoly’s story.

Insurtech is a booming industry in the UK – and we’d love to know what you think:


Andrew Lockley
Exponential Investor