Buying companies in insurance digitisation

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Integral service around a transaction
BY : Diego GutiérrezDecember Tue, 2018

We analyse the purchase of companies in the insurance digitalisation sector. We talk about a booming sector with future applications in various fields, generating trends or market expectations. In addition to the purchase of companies, we also explain the most recent round of financing confirmed in the sector.

Digital insurance industry trends

The future of digitalisation in the insurance sector is so promising that several trends are already being identified with regard to its implementation. Four types of trends can be distinguished: transitory, necessary, experimental and threatening.

The transitional are defined as trends where there are uncertainty about market opportunities. As they become more widely known, they can generate new opportunities and markets. One such example could be the implementation of chatboxes when serving customers.

The necessary are trends that are seeing the widespread implementation or adoption by industry and customersand where the market and applications are understood. In the US, the use of smartphones to track users' driving behaviour is gaining ground.

The trends experimental are products that have not been adopted broadly to the sector. One example is home buying, as this process becomes digital, home insurance will become more closely integrated with platforms over time.

Threatening trends are trends with large market forecasts and significant investment activity, but which can standing on the edge of the abyss. Smart home technology held some promise for home insurers, but efforts were lacklustre. In recent years, insurers have partnered with smart home device manufacturers to offer discounts to consumers who installed these devices in their homes.


Acquisition of companies in the sector

First of all we talked about the acquisition of the Carlyle Groupwhich closed in September 2017 the agreement to acquire Prima Solutions. Carlyle Europe Technology Partners III, a EUR 657 million Carlyle fund focused on European technology, media and telecommunications (TMT) companies, made the investment for an undisclosed amount.

The Carlyle Group is a Washington-based private equity firm serving early and later stage companies.

Prima Solutions, on the other hand, is a French software provider which designs, develops and markets software exclusively for insurance providers. Founded in 2000 and headquartered in Paris, it offers modular digital applications to help insurance companies optimise customer relations and insurance policy administration.

With a presence in European and international markets, Prima Solutions has 200 employees and has grown by more than 80% per year since 2013, reaching a turnover of more than €20 million in 2017.

Another purchase we would like to highlight is that of Open GIwhich announced in April 2017 the strategic acquisition of Transactor Global Solutions Ltd (TGSL Group). valued at $50 million. The acquisition is part of Open GI's ongoing investment to provide its customers with cutting-edge, market-leading solutions.

Open GI is one of the leading technology partners for general insurance brokers in the UK and Irish markets. Its Core Broking platform provides multi-line, multi-channel and multi-brand trading capability complemented by innovative e-commerce and mobile trading technologies.

Founded in 2003, the TGSL Group offers one of the world's leading more advanced and innovative policy rating and administration in the UK general insurance market. It provides configurable insurance software to a variety of insurance brokers, underwriting agencies, insurers and MGAs.

The TGSL group has annual revenues of USD 15 million and employs around 200 people. As of today, its closest competitors are FINEOS, Acturis y EIS Group.

Finally, we look at the recent purchase of Seeman Holtz Property & Casualtya comprehensive insurance advisor. Your 50th transaction has gone to the company Gojia Boston-based online auto and home insurance technology platform.

Goji (formerly Consumers United, Inc.) operates a distribution platform of data-driven personal lines insurance and analytics. This is achieved through its integrated network of more than a dozen national insurance companies.

Its USD 21 million annual turnover has pushed SHPC to make the acquisition of the US company. The companies CoverHoundNetQuote and The Zebra compete with Goji to lead the industry.

Element closes a Serie A round

29 November 2018 Element Insurance has closed a financing round 23 million. This round of Serie A category has been underwritten by Engel & Völkers Capital, SBI Investment, SBI Insurance Group and the Spanish insurtech investor Alma Mundi Ventures.

Element Insurance, founded in 2016 and headquartered in Berlin, is a company dedicated to offering white label products related to the insurance industry, specialising in insurance digitalisation.

The company's fully digital approach allows it to develop insurance policies in a matter of weeks, even for very specific target groups. With a full insurance licence in 28 European countries, Element is able to act as a risk carrier for its partners and cover the majority of the value chain insurance.

With the new capital, Element plans to strengthen its platform and network, and begin expanding into international markets. Christian Macht, Chief Representative of Element, said: "Our success as a private label manufacturer has convinced investors to support the company's growth. The future in insuranceas in many other industries, is collaboration: highly specialised market participants focusing on parts of the value chain.

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