Insurability and Luko's epilogue
Luko’s roller-coaster ride and urgent search for a buyer finally came to an end when news emerged that Allianz Direct would buy the French insurtech startup for €4.3 million (around $4.65 million), enabling business to continue and jobs to be maintained.
Court documents reveal that Luko’s suitors also included several other insurtech startups: Laka, Leocare, Lovys and Magnolia. French neoinsurer Leocare, in particular, was willing to take over at least 26 of Luko’s employees and all of its French home insurance business, but its €10 bid was no rival for Allianz Direct’s final offer.
However, Leocare CEO Christophe Dandois is no sore loser. In a post on LinkedIn, he wished his competitors good luck while recapping their journey and what could have been. Sure, mistakes were made, but both founding teams shared a desire to bring solutions to the growing challenge of insurability.
Insurability wasn’t a term I was very familiar with, but many of us intuitively understand what’s at play: Risk exposure is a fine balance for insurers. With factors such as more frequent weather and climate hazards, or even simply societal changes like remote work and new forms of mobility, Dandois explained, there’s a time when it just becomes too much to insure risks the old way, at least affordably.
Still, I wondered what this had to do with selling home insurance in France, like Luko and Leocare do. But reading more on the topic, I realized that this was more than a thought exercise.
“While France has yet to share the fate of the United States, where insurers are withdrawing en masse from certain regions exposed to natural disasters,” French newspaper Les Echos noted recently, “the phenomenon is already visible in the French overseas territories, where property insurance coverage stands at 50%, compared with 96% in mainland France.”
Hence Dandois’ view, which is both moderate and bold: “Neoinsurers aren’t the only future of insurance, but without their digital and APIzation know-how, without their ability to deploy quickly and make data speak, there will be no social and societal answer to THE question of insurability.” A worthy challenge for tech to take on.
|