Japan’s Softbank is planning to invest more money into insurance sector and also partner with reinsurance companies as part of its strategy to accelerate digital upheaval in the re/insurance industry, a company executive told Reuters.
David Thevenon, a dealmaker at SoftBank’s Vision Fund, told the publication that Vision Fund is mulling to pump more capital in insurance companies as the company believes that the insurance sector is ready for disruption.
The Vision Fund, which has a war-chest of about $100bn, has invested in China-based online insurer ZhongAn, Indian online insurance distributor PolicyBazaar as well as app-based US home insurer Lemonade.
Thevenon told Reuters that these and other insurance bets totalling nearly $3bn are just the start.
“We believe that technology and how data is used, processed and collected is going to transform insurance,” Thevenon told the publication.
Softbank: a new class of insurance?
Softbank noted that a new class of insurance technology firm can work with other companies within its portfolio such as ride-hailing firm Uber Technologies and office sharing firm WeWork and launch new products and services for their customers.
The fund has concluded half the dozen biggest insurance investments in the year to June including its stakes in ZhongAn and two units of Chinese insurer Ping An.
“We are going to have to place several bets,” Thevenon added.
“The nice thing about insurance is that this is so big, it’s not exactly a market where you make one investment and you suddenly have 90% market share,” the publication further quoted him as saying.
PolicyBazaar CEO Yashish Dahiya told Reuters that he would like to collaborate with Softbank’s network of companies to develop these businesses.
Additionally, the report claims that Softbank is holding talks with big insurers for possible partnerships that could see them supply underwriting and regulatory expertise to the new-model insurance companies in its portfolio.