Insurance specialist Cover Genius has gone from Sydney startup to global disruptor in just 7 years.
The Australia-based company is now the leading global insurtech for embedded insurance. Cover Genius partners with the world’s largest digital companies – including Booking Holdings, eBay, Amazon and Ryanair – to embed any line of insurance or warranty product into online sales and offer it directly to that partner’s customers.
Success has been meteoric. In February 2022, the company reported that it sold more than 10 million policies. It also registered a 667% increase in sales for its global distribution platform, XCover. According to Bloomberg, Cover Genius is valued at more than A$1 billion.
Today the company is active in multiple sectors. These include retail, travel and logistics, property, finance, mobility and auto, ticketing and events, and business services.
Aussie spirit helps re-invent insurance
The insurtech phenomenon began in Sydney in 2014. Founders Chris Bayley and Angus McDonald ran an online travel business. But getting the right insurance to travellers from different countries was a constant problem.
Bayley and McDonald spotted an opportunity. They decided to launch a new method for marketing insurance policies. This included a novel insurance distribution platform.
The company’s approach was typically Australian: straightforward and down-to-earth.
‘Insurance doesn’t have to be painful,’ says Graeme Dean, Vice President, Global Insurance Solutions, Cover Genius. ‘Our idea was to write easy-to-read policies that people understand. We want to get the right protection into the hands of people at the right time and place.
‘We make sure claims are handled quickly with a tech-led approach, and payouts happen fast,’ he adds. ‘Also, our service can be integrated into customer platforms with a single connection, or application programming interface. This makes us unique in the embedded insurance industry.’
With this new approach, Cover Genius quickly built a technology platform that links insurers to online transactions and includes dynamic pricing. The market reaction was phenomenal. Success came fast.
Global partnerships power global expansion
In 2014, Cover Genius signed a deal with Booking Holdings, owner of Priceline, Kayak and Booking.com, to integrate insurance policies into the booking path.
To service the deal, Cover Genius set up its first overseas office in London. The new office included a regional team to help with sales and integration engineering.
‘We ramped up our service offering so that we could offer different lines of insurance across multiple sectors,’ says Dean.
One key challenge in London was how to raise brand awareness. Cover Genius’ solution was to be proactive with thought leadership. The company pitched articles to media about emerging insurtech trends and how they addressed current marketplace challenges.
‘As an early adopter of embedded insurance, we invest time in educating the market,’ says Dean. ‘We help the market understand what embedded insurance is. We explain how it can improve multiple aspects of the insurance value chain to create a better customer experience.’
Insurtech rises to the COVID-19 challenge
The 2020–21 pandemic gave Cover Genius an opportunity to show just how agile it could be. While pandemic lockdowns hammered global travel, Cover Genius collaborated with its pre-existing travel partner Skyscanner to tailor their travel-insurance product.
‘We worked with Skyscanner and others including Ryanair to create protection for COVID-related issues, and then embedded it within the customer flight-booking experience,’ says Dean.
The idea caught on. And it showed how fast insurtech can outflank traditional insurance companies.
‘Our protection was soon available at Amazon,’ says Dean. ‘Also, we partnered with Shopee and Flipkart, the largest online retailers in South East Asia and India respectively.’
Startups build on Australian fintech talent
Australia’s core strength in fintech is built on people and skills. Australia is bursting with tech talent, according to a recent report from the industry body, Tech Council of Australia. It says there are now 861,000 people employed in the tech sector in Australia or 1 in 16 of the working population.
‘The rapid growth of Cover Genius can be attributed to the unique capabilities of our award-winning global distribution platform, XCover, and our diverse team of curious individuals who work – and succeed – together to bring innovative ideas and fresh perspectives,’ says Dean.
A showcase for smart Australian fintech
Cover Genius’ approach marks a sea change in insurance. Research conducted by Momentive.ai and Cover Genius reveals customers prefer embedded insurance to traditional insurance offerings.
Using the standard metric to determine customer experiences – the net promoter score (NPS) – Cover Genius scores +65. The average NPS for traditional insurers is –25.
‘This is our reward for simplicity, says Dean. ‘We have cut our own path through the insurance market.’
The company’s global strategy also pays dividends. Cover Genius works hard to support customer brands in multiple markets around the world.
‘If we start working with a partner in one country, we offer our services to that partner in other markets as well,’ says Dean. ‘In effect, we have created a new, end-to-end service for global consumer brands.’
Advice for other fintechs
Cover Genius’ magic is working. In late 2021, the company’s Series C funding raised A$100 million. Meanwhile, the UK’s Financial Times reported that the company’s annual growth rate averaged nearly 500% from 2015 to 2018.
‘We recently topped the Financial Times ranking for fast-growing companies in the Asia-Pacific region,’ says Dean. ‘We now have offices in London, New York, San Francisco, Seoul, Kuala Lumpur, Manila, Amsterdam and Tokyo. That’s not bad for a company that started in Sydney in 2014.’
