The Pioneer spirit

Leading the fleet:

Admiral isn’t content to conform

spırıt Pıoneer The

Admiral has sailed across several industry horizons, but CEO of its venture-building business, Emma Huntington, has now been given a ‘blank sheet’ to create and launch a fleet of startups… not all of them insurtechs

General insurance is at a pivotal point, fashioned by both the predicted and the unexpected.

It was already facing the anticipated future challenges of a world growing less reliant on fossil fuels, and more reliant on digital technology, when the colossal and sudden impact of the COVID-19 pandemic flipped a headwind of change into a tailwind of innovation.

Overnight, as lockdowns were imposed, which need to reinvent themselves as a result of the accelerated decline in retail and office utilisation.

the daily routines for millions of people were dramatically adjusted. And one of the most impactful consequences was that working from home became a new norm, forcing less reliance on the car – with the jury still very much out over whether there will ever be a full return to pre-pandemic practices. There’s plenty of pressure – political, economic and social – for things to stay this way.

A recent report by the Centre for Research into Energy Demand Solutions, for example, concluded that instead of pushing forward with a £27billion roads investment programme (which, in itself, is subject to challenge on its compliance with the UK Government’s climate goals), much of this money could be diverted to carbon-reducing projects that deliver health, safety and wellbeing benefits for all. That would tie in, the report notes, with other policy goals, such as re-vitalising town and city centres,

An Admir-able approach

For companies like general insurance and loans group Admiral, the UK’s largest motor insurer, the slump in vehicle use caused by the pandemic was a rehearsal for what could be a future reality.

It was the first insurer to react to the pandemic in 2020, spontaneously distributing £110million in flat-rate, automatic refunds to all its motor customers in recognition that their decreased time on the road would mean fewer claims. And it invested a further £80million in reducing prices and providing specific support packages for NHS and emergency services workers, including the waiving of motor claims

excesses and providing free courtesy cars if their vehicles were written off or left undriveable due to accidents. Its agile, decisive approach to the crisis further cemented customer loyalty and retention (for which it already had an award-winning reputation), helping it to post pre-tax profits of £638.4million in its 2020 financial year, up 21 per cent on a year earlier. But, long before ‘lockdown’ was part of our everyday vocabulary, the company that changed the way most of us shop for car insurance by launching the first price comparison website (PCW) in 2001, had been thinking about how it might respond to a world where jumping into your car wasn’t the default option.

Veygo, which has become Admiral’s short-term motor insurance brand, providing app and online-based instant learner and temporary driver cover from one hour to 30 days, was set up in 2017, with a separate team dedicated to exploring different technologies, use cases and business models for future, mobility-related insurance. Now that team will come under the remit of Admiral Pioneer, a wider-ranging new venture-building business, created at the beginning of last year to seed, grow and scale a new fleet of disruptive techs for the insurer. Two launched this year: Toolbox By Admiral, which has a standalone site, currently offering tool and contents cover from £1/day for the thousands of tradespeople who work out of the back of their vans in the UK; and Kooalys, a green auto insurance product for the French market, which encourages and rewards companies for decreasing CO2 emissions in their vehicle fleets.

“In both cases, at this early stage we are focussed on learning as much as possible about the needs of customers in these segments and how we can constantly refine and improve our propositions as these markets evolve,” says Admiral Pioneer CEO Emma Huntington, who joined from Nationwide Building Society, where she was head of innovation and venturing. She says she was handed a blank sheet by Admiral before the pandemic to conceive, launch and grow businesses in insurance, non-insurance or a combination of both, with a particular focus on mobility, the future of work and living to 101.

“Our aspiration is to have a significant impact on Admiral’s commercial business lines in the longer term,” says Huntington.

“Insurance is absolutely critical to people’s lives – it’s your health, your home, how you work, your mobility. The work done by Admiral Pioneer will allow Admiral to offer prevention-type solutions in all these areas, as well as value-added solutions for customers that go above and beyond, but also include insurance.”

At the core of that is how the company gathers and consumes data.

Last December, Admiral announced a tie-up with open banking fintech Credit Kudos to boost the credit decisions process for its loans business, pledging at the time to increase the use of open data to offer ‘new and revolutionary products’ to ensure it can respond and adapt to its customers’ needs. During 2020, it doubled the number of machine learning models pushed into production, moved a vast part of its business to scaled, agile working, and transitioned the majority of its customer data to the Cloud.

The work done by Admiral Pioneer will allow Admiral to offer more prevention-type, value-added solutions for customers that go above and beyond, but include insurance

“Open data, and obviously our own industry data, is allowing insurers to not only structure their products and risk, but also to think about risk in different ways,” says Huntington. “It’s also enabling partnerships, which are more seamless than you would’ve seen in the past.”

In April this year, Admiral was one of six leading insurers to sign up to the Fintech Pledge, developed by Tech Nation, the UK Government-backed growth platform for tech companies and their leaders, to provide a standardised framework for institutions to partner with startups and scaleups. While Huntington’s remit is for Admiral Pioneer to pump-prime the company’s own new business models, she sees the Pledge applying just as much to the relationship between her unit and the rest of the organisation: “Because we are an insurtech, in and of ourselves, building startup businesses, albeit owned by Admiral. When creating those businesses, we want the benefits of Admiral Group, but with the freedom and ability to move at pace, test and learn and try new things. It’s why we absolutely support the Pledge.”

Looking at development of the wider industry, she adds: “Government support in this is hugely valuable. We want to have a strong, thriving financial services sector, including insurance, and it’s so important that we develop new capabilities, and really strong commercial businesses.

“Some of the insurtechs created in the UK will be global but if they can start here, that’s fantastic for our sector, for vour economy, and the people with talent within our space.

“It’s important we innovate, foster talent, partner and help smaller businesses succeed. If we can do that together, to mutual advantage, brilliant.”

Already an international business with operations in Europe and the US, in April 2021, Admiral completed the disposal of its online comparison sites Confused.com – the first car insurance PCW – Rastreator.com and LeLynx.fr to Zoopla Property Group, which owns USwitch, in a deal that netted the insurer about £460million. It has said it will continue to work closely with them and the innovation centre it set up that’s attached to them, while maintaining an internal core of 500 of its own technologists, all working to improve and create new digital processes for Admiral Group.

In October 2020, digital analysts Deltabase rated Admiral for its advanced use of digital technologies, noting that the launch of Admiral Pioneer should help ‘increase the chance of Admiral being the disruptor rather than the disrupted’.

While that was before the disposal of its ground-breaking PCW, this Admiral clearly has its telescope trained on another distant, disruptive horizon. Or, as Deltabase concluded: “Whilst more traditional and less digitally-mature insurance companies may be sitting ducks for disintermediation and disruption by insurtech startups and scaleups, Admiral demonstrates it has its finger on the pulse of digital innovation.”