What’s the future of Israeli insurance-tech?

While local start-ups succeed across the board, insurance disruption proves trickier.

HiBob engineers Lior Harel, Doron Cyngiser and Omri Hecht win the gold at the Tel Aviv Stock Exchange’s Pension and Insurance Hackathon. (photo credit: TASE)
HiBob engineers Lior Harel, Doron Cyngiser and Omri Hecht win the gold at the Tel Aviv Stock Exchange’s Pension and Insurance Hackathon.
(photo credit: TASE)
Israeli start-ups that are developing software to transform how you save for retirement and to help you better understand your employee benefits and pension plans vied to take home the top prize at the Tel Aviv Stock Exchange Pension and Insurance Hackathon last week.
Attendees belted out, “Where’s the money?” as they shouted down semifinalists on stage who were presenting their proposals. The all-night competition was attended by 150 people, with 36 groups competing to persuade inventors that their product was disruptive and marketable, showcasing how the country is making inroads into insurance- tech, or “insurtech” and financial-tech, or “fintech.”
Unlike major successes in advertisement-tech, driverless cars and cybertech, Israeli start-ups face challenges in disrupting the local insurance industry. Many fintech firms focus on the American and European markets, overlooking how the Israeli insurance and pension markets are regulated and managed. And organizers of the hackathon described additional obstacles.
“The data in Israel [are] not accessible. That’s a big hurdle for all the start-ups to get into it,” Tel Aviv Stock Exchange CEO Itai Ben-Zeev told The Jerusalem Post, noting the contrast with the United States where credit scores are public and accessible. “On one hand, Israel is extremely well-known in terms of our innovation and start-ups. When you look at other fields, we’re not developed enough in terms of data and reaching out to the public. Insurance is an example of that.”
The hackathon’s winner, HiBob, a venture capital- backed company, devised an end-to-end solution for Israeli employers that grants workers a greater understanding of their pension and benefits plans, along with automated smartphone alerts to ping and nudge them into saving.
Unlike most Israeli start-ups with an international orientation, HiBob went to the National Insurance Institute and requested data to analyze the commission and interest rate of potential plans.
It may sound boring to develop tools for human resources, but HiBob could transform how Israeli companies manage time off, the time log and performance management – along with health and life insurance plans, pensions, 401(k) enrollment and cash savings.
“People don’t understand how much money they have in pension savings,” said HiBob engineer Lior Harel. “It’s the most expensive asset someone can have, only second to an apartment. It’s huge. And we want to empower the employees [as to] what they have in the bank, what will be there in 30 to 40 years.”
The three HiBob engineers, Harel, Doron Cyngiser and Omri Hecht took home winnings of NIS 23,000 ($6,540), along with three-month’s access to a workspace at the Tel Aviv Stock Exchange. The company is already operating in the British and Israeli markets and has offices in London and Tel Aviv.
The runner-up was Scanovate, winning NIS 10,000 ($2,843), presented an authentication tool to verify an end user’s digital identity from their insurance identity card. The start-up specializes in optical character recognition – or taking images of typed or handwritten text, such as in a PDF – and transforming it into accessible text.
The third place start-up, taking home NIS 5,000 ($1,421), was Polywizz, a platform that collects and analyzes customers’ insurance plans using big data “Today’s event constitutes the opening shot to promote technological innovation... Today we connect the insurance and pension savings industry to the hi-tech industry and bring Israeli entrepreneurship and creativity to the worlds of insurance and pension,” said Deputy Finance Minister Itzik Cohen.