For the First Time in the Country: Specialized Course on Financial Technology Business Management (Fintech) at Khatam University

The closing ceremony of the first Fintech MBA financial technology business management course was held on 23 June 2022, with the presence of a number of the professors and participants of the course and directors of Fanap company in Imam Reza Hall at Khatam University. This ceremony was held as the final session of the last course (fundamentals of insurance technologies - insurtech).

At the end of the class session, Dr. Seyedreza Jalalzadeh, faculty member and director of the Specialized Training and Skill Enhancement Center of Khatam University, attended the class and elaborated on the details of the first Fintech MBA course and thanked all the students who had enthusiastically completed this course.

The director of Khatam University's Specialized Training and Skill Enhancement Center said: “this course was designed in 432 hours in the two majors of “Banking and Insurance” and “Stock Exchange and Capital Market”, using the most up-to-date syllabi of prestigious universities of the world. He went on to say: “we held the first Fintech course with the cooperation of Fanap and Dr. Ahmadi Pooya”.

Dr. Jalalzadeh announced the purpose of presenting this course as obtaining the official license for establishing this program from the Ministry of Science after reviewing and re-implementing the course. He added: “the planning for this course was conducted simultaneously with the foundation of the Specialized Training and Skill Enhancement Center of Khatam University”.

At the beginning of the class session, one of the students of the course presented her research project regarding the business model of one of the world's most successful insurtechs, called "Lemonade". Mozhgan Ghasemi first reminded the rather infamous image of traditional insurance companies in public opinion and added: “usually, these companies first charge customers with offers of special services, and in case of damage, only a portion is retaliated; traditional companies invest the surplus in certain areas”.

She further stated: “due to the existence of competition, these companies are ‘forced to keep their eyes open’, which made ‘Lemonade’ a game-changer. Ghasemi said that Lemonade started in insurtech in 2015 with the slogan “Forget all you knew of insurance”.

She emphasized: "Lemonade" benefits from chat bots to check customer claims, which are checked and addressed in three to four seconds. This has made it stay ahead of the competitors by miles in terms of data acquisition.

According to this speaker, the startup "Lemonade" is based on behavioral economics and implements an incentive system to gain people's trust. For this purpose, "Lemonade" has arranged to only charge a fixed fee for each insurance and the surplus is donated to a charity.

Also, "Lemonade" has an identification algorithm and claims 25% of the fixed cost and 75% is used to cover the loss of reinsurance and cover taxes and expenses. The excess is donated to a charity of the customer's choice, so consumers do not feel the need to cheat their insurance company.

Insurtech to Alter the Future of the Insurance Industry

Then, Dr. Saeed Ahmadi Pooya, Senior Business Development and Fintech Consultant of Fanap Company and Professor of Fundamentals of Insurance Technologies, presented the topics of the last session of his class and examined the business models and the reasons for the exponential growth of insurtech unicorns in 2022.

Ahmadi Pooya said: “In Iran, insurance has a traditional structure and the penetration rate of insurance in Iran is 2.7 percent. This number shows that the insurance ecosystem in Iran is very small, and the industry has focused on the sale of insurance policies in order to expand itself, and this is perhaps the reason why Insurtechs in Iran have taken the approach of marketing and expanding the sales area through aggregators”.

For this reason, insurtechs can implement ideas and plans for the development and expansion of the insurance business in Iran by examining successful global business models, which is of course a very difficult task. This speaker further mentioned the checklist necessary to become a unicorn in the insurance industry in the world and said: creating and developing a stable minimum viable product, designing a business model accurately, designing reliable financing methods, and designing a scale-up process are essential for exponential growth.

Ahmadi Pooya further added: In the review of the unicorns of 2022, there are some common features that should be taken into consideration. First, disruptiveness is the business of unicorns. As an example, "Lemonade" has disrupted the insurance industry and turned it into a P2P business, which offers a lot to contemplate.

The second obvious feature is being tech-savvy, which has caused unicorns to shape their business model around providing affordable products and services for customers, and focus on designing a pleasant user experience and providing an easy understanding of how it is to be used for the customer along with an exciting value proposition in the product for the customer. In addition, two other prominent features are the focus on the customer's need chain and the efficiency of the product. The approach of these businesses is to take advantage of diverse growth strategies to help the business grow with fewer and more efficient resources. In this regard, wherever need was spotted, instead of developing their organization, they turned to merging with other businesses or acquiring other startups, or even to the strategy of unifying competitors; these precise and bold approaches have led to increasing popularity among customers and exponential growth of the business.

Ahmadi Pooya further considered being growth-driven as the last important feature of unicorn companies, and for this purpose, choosing a huge transformational goal for business, thinking out-of-the-box to achieve the goal and a clear vision in the mind, are among the requirements for growing a business exponentially. He also named the top ten unicorn startups in the insurance industry in the US and the benefits of each.

The Top Ten FinTech Unicorns

The first unicorn reviewed was NextInsurance, valued at more than $4 billion, which offers small businesses a comprehensive platform for covering a wide range of insurance products through a partnership with Amazon via Business Prime. With the purchase of Juniper Labs last year, this smart unicorn has started taking advantage of Juniper's open data, and with machine learning-based tools, it has been able to provide customized services to customers and achieve the current market valuation.

The second unicorn was Cedar, which has been customizing and simplifying the medical payment experience by providing a customer-friendly approach. He said, unfortunately, in our country, insurance companies seek not to pay damages; but in the world, they move in the direction of investigating the customer's claim and paying for the damage in the shortest possible time.

The Fanap business consultant went on to say that the next unicorn, Ethos, is known as an ethical life insurance. This company analyzes 300,000 data items and completes all the insurance procedures in one day. Therefore, there is no need for the individual to be present, and it collects the necessary information based on the data.

Another unicorn, New Front, is a digital platform that eases the traditional tedious insurance processes on the user.

Ahmadi Pooya also mentioned Oscar among other unicorns and said: this company uses data technology to provide health insurance to individuals, families and small businesses and provides care services virtually. Another unicorn of the industry is Collective Heath, a cloud-based integrated health platform for managing various healthcare applications.

At_Bay unicorn provides cyber insurance services and a risk management platform for businesses, covering the areas of information privacy, network security and preventing business interruption, including cyber extortion, financial fraud and media content.

He continued: the Hippo Insurance unicorn has provided smart coverage and a new approach to home insurance. By personalizing insurance policies, this unicorn offers customized insurance to each customer to cover commonplace household items not covered by standard home insurance, including cleaners and babysitters.

Ahmadi Pooya mentioned the Sidecar Health platform, which is the personal medical insurance of users based on their budget, and finally mentioned Clearcover. This insurance platform is based on a mobile application with automatic policies, to find, compare, buy and manage and provide offers through wizards, and it provides the possibility of registering claims transparently and sending details and evidence of damage through smartphones, and has been able to break the damage payment record by providing services in seven minutes.

Examining the Experience and Business Model of an Iranian Insurtech

In the last session of the class, Dr. Ahmadi Pooya, by inviting "Bahareh Sharifion", the CEO of Bimeh.Com, examined the challenges of insurtechs in Iran and the business model of Bimeh.Com. Sharifion discussed the formation of this startup in 2016 and the problems faced by startups in the field of insurance.

The CEO of Bimeh.Com pointed to the lack of belief in insurance as a fundamental problem, and also called the lack of necessary data in this industry another challenge that this startup has always struggled with.

She added: “the insurance industry in Iran is mostly based on sales”. The CEO of Bimeh.Com noted: “our story as an insuretech is not just about sales, but trying to experience various innovations in the insurance industry. We planned for it and launched the AI ​​Department. It is also important for us to produce content in this field, and Bimeh.Com magazine is published with the goal of awareness-raising in the insurance industry”.

The financial technology business management course was held for 432 hours from December 2020 through the efforts of Khatam University's Specialized Training and Skill Enhancement Center, and the course came to an end today, June 23. The professors of the first Fintech course were Messrs. Javanmardi, Manteghi, Jalalzadeh, Ahmadi Pooya, Tehrani, Pourgholamali, Zamani, Ghasemi and Mss. Saemian, Mirzaei, Afsari and Dehghan.

Social networks of the Specialized Training Center:

Telegram

Instagram

LinkedIn