The trade association hopes to reduce bureaucracy and promote the role of insurance as ’oxygen of the economy’ in both the UK and US
Insurtech startup trade association Insurtech UK yesterday (10 March 2022) launched an insurance corridor between the UK and Connecticut, USA.
As part of the broader US-UK Financial Innovation Partnership (FIP), which was established in May 2019 by the US Department of the Treasury and the UK’s HM Treasury, the corridor is designed to remove the barriers faced by insurtechs in the UK and US when looking to access each other’s insurance marketplace and enhance transatlantic cooperation.
The corridor is backed by Insutech UK, Connecticut Insurance and Financial Services (CT IFS), non-profit organisation MetroHartford Alliance, government office the Connecticut Department of Economic and Community Development, as well as the Connecticut Insurance Department.
The corridor agreement was signed in Hartford, Connecticut yesterday, with UK industry stakeholders and regional officials able to participate thanks to a broadcasted video stream to Lloyd’s Lab.
John Warburton, Insurtech UK council member and chair of the government and external affairs working group, said: “The size and competitiveness of the UK insurance market has led to the creation of a world-leading UK insurtech landscape. Most UK insurtechs see the US as the most attractive international destination for expansion.
“This corridor is therefore a fantastic opportunity to remove the barriers facing UK businesses in making that first step into the US market. Connecticut has a strong reputation for attracting inward investment and supporting insurance innovation, so is the perfect home for a UK-US insurtech corridor.”
Insurtech UK believes the corridor will provide immediate and substantive value for its members and for the broader UK and US insurance sectors.
The corridor agreement is also the first step in developing an online platform of free resources for companies, which will launch later this year.
Speaking on the insurance corridor when it was first announced in December 2021, James York, co-chair of Insurtech UK, said: “Let’s take a moment to be different to the rest of the insurance industry.
“Insurance technology startups can carve a different path - if you think about it, nothing happens without insurance. I love insurance and I hope everyone else does too - it’s the oxygen of the economy.”
Through close collaboration, the corridor will help participating US and UK companies to:
- Increase their knowledge of each respective market.
- Access resources and make valuable connections to accelerate business growth.
- Connect with business development and investment opportunities.
- Streamline US and UK market entry by leveraging local insurance ecosystems.
Her Majesty’s trade commissioner to North America and HM Consul General for New York Emma Wade-Smith added: “As world leaders for innovative, cutting-edge practices in the insurance sector, it was natural to pursue this partnership between the UK and Connecticut.
”The insurtech corridor will revolutionise how we approach transatlantic market entrances. As home to one of the oldest and largest insurance industries in the US, Connecticut is the perfect fit for the UK.
“This corridor will reduce bureaucracy, enabling the industry to better pursue growth and business opportunities, to benefit consumers and our economies in both locations.”
What is the US-UK Financial Innovation Partnership?
Established in May 2019, the US-UK Financial Innovation Partnership (FIP) aims to enhance collaboration in the private sector through the sharing of information and expertise around regulatory practices. This is designed to promote growth and innovation.
The partnership arranged by the US Department of the Treasury and the UK’s HM Treasury strives to deepen bilateral engagement on emerging trends in financial services innovation. FIP has two main focuses - regulatory engagement and commercial engagement.
When the FIP launched, John Glen, ecconomic secretary to HM Treasury, said: ”The United Kingdom and United States lead the world in financial services and are at the cutting edge of innovative fintech.
”By working more closely together through this partnership, we can help firms in both our countries to go even further to harness new technologies, share expertise and serve consumers.”
Oldest and largest insurance industry
The State of Connecticut has one of the oldest and largest insurance industries in the US - it is nicknamed ’The Insurance Capital’ and is home to more than 100 different insurance companies. For example, Aetna, Conning, The Hartford, Prudential, Travelers, Axa and Nassau Re have operations in Connecticut’s capital city Hartford.
As a result, Connecticut has also developed a thriving insurtech ecosystem.
Executive director and vice-president at CT IFS Susan Winkler said: “Our talent base of human ingenuity includes thousands of employees in the Insurance Capital with years of experience that can’t be matched anywhere in the world.
“This workforce of risk managers, actuaries, claim handlers and underwriters enables an unyielding commitment to innovation and quality for any company looking to establish a foothold in the US.”
David Lehman, commissioner for the Connecticut Department of Economic and Community Development, added: “The creation of the insurtech corridor is the latest example of how Connecticut is focused on strengthening its innovation ecosystems and workforce pipelines through public-private partnerships.
“This collaboration with the UK will create overseas business development and investment opportunities for Connecticut companies, as well as attract new firms and jobs to our state.”