Build, Buy, or Partner? How To Collaborate With Insurtechs

Published on 07 Jun 2024, authored by:
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IglooContent team

As the insurance industry stands at this crossroads, traditional players must decide: should they build their own solutions, buy innovative startups, or partner with these pioneers?

Thought leadership article

build buy partner insurtech

In the rapidly evolving landscape of insurance technology, the question is no longer whether traditional insurance companies should innovate, but how. The rise of insurtechs—startups that use technology to improve or disrupt the insurance industry—presents both a challenge and an opportunity.

These companies bring forward-thinking solutions to age-old industry problems, from using artificial intelligence for more accurate risk assessment to employing blockchain technology for fraud prevention. As the industry stands at this crossroads, traditional players must decide: should they build their own solutions, buy innovative startups, or partner with these pioneers?

insurtech ecosystem

Understanding the Insurtech Ecosystem

Insurtechs are more than just a buzzword; they are at the forefront of modernising the traditionally slow-to-change insurance sector. With innovative offerings like personalised insurance policies and streamlined claims processes, they have set new expectations for customers. The collaboration with insurtechs not only allows traditional companies to stay relevant but also opens up avenues to redefine service standards and operational efficiencies.

Build: Innovating from Within

Choosing to build innovation internally means leveraging existing resources to develop new technologies or solutions. This path gives companies complete control over the innovation process and ensures seamless integration with current systems. However, this approach demands significant investment in terms of time and money, with no guarantee of success. Organisations large enough to afford this risk may find building in-house to be a worthy endeavour.

insurtech innovation

Buy: Acquiring Innovation

Acquisition is an expedient path to innovation. By buying an insurtech company, traditional insurers can rapidly integrate new technologies and onboard talented teams who are already ahead in the innovation game. This strategy allows for a quick market response but comes at a high cost and carries the risk of integration and cultural challenges. It requires a meticulous evaluation of strategic fit and return on investment.

Partner: Collaborating for Mutual Benefit

Partnerships offer a middle ground, allowing companies to share the risks and rewards of innovation. By collaborating with insurtechs, insurers can access specialised technologies and expedite their go-to-market strategy, all while maintaining control over their core operations. However, this approach necessitates careful management of expectations and contributions from both sides to avoid conflicts and ensure a successful collaboration.

insurtech partner collaboration

Benefits of Partnering Directly with Insurtechs

Partnering directly with an insurtech, as opposed to navigating relationships through intermediaries like brokers or traditional third-party administrators, offers distinctive advantages. Firstly, it ensures a more streamlined communication channel, enabling clearer understanding and quicker iterations on projects. This direct line can significantly enhance the pace at which products are developed, tested, and launched.

Additionally, by partnering directly, insurance companies can tap into the innovative culture of insurtechs, integrating cutting-edge technologies and methodologies into their own processes. This can lead to the development of truly innovative offerings that might not be feasible through traditional channels. Moreover, these partnerships can result in improved cost-efficiency by minimising intermediary fees and enabling more flexible pricing models, ultimately benefiting the end customer.

The Emergence of Embedded Insurance

Embedded insurance, where insurance products are integrated seamlessly into the purchase process of another product or service, is revolutionising the industry. Unlike traditional models that rely on agents or brokers to push products to consumers, embedded insurance offers coverage at the point of need, simplifying the customer’s decision-making process and enhancing their overall experience. This model not only increases insurance penetration by reaching customers in untapped markets but also allows for the customisation of insurance products based on specific transactions.

embedded insurance concept

Identifying the Right Insurtech Partners

Finding the right insurtech partner involves assessing potential partners on several fronts. Key considerations include technological compatibility, the ability to scale solutions, and alignment of strategic visions. Insurtechs that demonstrate a robust understanding of customer pain points, have a proven track record of innovation, and share a commitment to transforming the insurance landscape are ideal candidates. Due diligence, including pilot projects and proof-of-concept stages, can help in evaluating the potential for a long-term partnership.

Embedded Insurance vs Traditional Models

Embedded insurance represents a paradigm shift from traditional models reliant on agents and brokers. This approach streamlines the insurance buying process, making it intuitive and integrated with products or services the customer is already purchasing. For instance, buying travel insurance directly from a flight booking app at the point of ticket purchase exemplifies this seamless integration. This contrasts sharply with the traditional model, which often requires customers to actively seek out insurance products, leading to a more complicated and time-consuming purchasing process.

The embedded model benefits all stakeholders; customers receive relevant offers without the hassle, insurtechs and insurers tap into broader markets, and the partners embedding the insurance can provide added value to their customers, enhancing loyalty and trust. As such, embedded insurance doesn’t just expand the market for insurers; it transforms the very nature of how insurance is perceived and purchased, moving towards a more customer-centric model that aligns with modern expectations of convenience and personalisation.

Decision-Making Framework

When deciding between build, buy, or partner, companies should consider their strategic objectives, available resources, market dynamics, and risk appetite. The decision should align with the company’s goals, whether it’s enhancing customer experience, reducing operational costs, or entering new markets.

Additionally, the choice should reflect the company’s capability to manage the innovation timeline and integrate new solutions smoothly.


The insurtech wave is transforming the insurance landscape, pushing traditional companies toward inevitable innovation. Deciding whether to build, buy, or partner with insurtech companies is a strategic choice that requires careful consideration. By aligning this decision with their strategic objectives and market position, insurers can not only navigate this transformation successfully but also play a leading role in shaping the future of insurance.

As we continue to pioneer in this space, we invite stakeholders, innovators, and visionaries to join us in exploring the vast potential of collaborations within the insurtech ecosystem. Together, we can create a more efficient, accessible, and customer-centric insurance industry.

For those interested in discussing potential collaborations or learning more about our innovation journey, please reach out. Let’s innovate together for a better, more connected future.

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