INSURANCE INNOVATION EXECUTIVE BOARD

STATE OF INSURTECH John Cusano March 2, 2018 INSURANCE INNOVATION EXECUTIVE BOARD

UPDATE ON INSURTECH INVESTMENT

THE INSURTECH LANDSCAPE IS GROWING WITH CLOSE TO $8.7 BILLION INVESTED TO DATE CUMULATIVE 2010-2017 483 COMPANIES 1 1,009 DEALS 52% 2010-17 CAGR 2 $8.7B INVESTED 3 % OF COMPANIES BY INSURANCE SECTOR Reinsurance Travel 1% 1% 21% Health P&C 42% 8% Life & Annuities NUMBER OF DEALS 238 331 18 40 51 69 110 152 28% Multiline FUNDING $M <$100M Castlight Health Clover Health MetroMile Oscar Health Zenefits Zhong An Lemonade Bright Health Gryphon 882 2,721 1,145 145 500 1,754 1,091 2,316 1,676 % OF COMPANIES BY CLASS OF INSURTECH Employee Benefits Platform Core Insurance Solution/Platform 348 334 160 931 130 103 120 145 171 400 37% 100 230 160 Digital Agency/Broker 2010 2011 2012 2013 2014 2015 2016 2017 5% (1) Considering currently active companies, independent and acquired 1% (2) Based on number of deals (3) The invested amount has not been disclosed for 254 deals out of 1,009 (25% of the database) Digital Insurer Microinsurance Platform Copyright 2018 Accenture All rights reserved. Source: Accenture Research analysis based on data from CB Insights 4 10% Others 4% 43%

NORTH AMERICA REMAINS THE LARGEST MARKET FOR INSURTECH INVESTMENTS CUMULATIVE 2010-2017 CANADA 12 companies 20 deals $47.8M US 245 companies 611 deals $5.9B LATAM 12 companies 22 deals $36.3M EUROPE 126 companies 218 deals $958M Country Companies/Deals/Volume UK 45/85/$406M Germany 21/36/$123M France 16/26/$93M Switzerland 6/8/$41M Sweden 6/12/$185M Spain 6/10/$34M Netherlands 5/8/$39M Italy 4/8/$5.8M Portugal 3/3/NA Denmark - 3/4/$23M Israel 2/5/$1.2M Belgium 2/2/$7.2M Ireland 2/3/$40K Norway 2/2/$120K Bulgaria 1/1/NA Estonia 1/3/$1.8K Poland 1/2/NA MART 24 companies 43 deals $50.8M INDIA 15 companies 29 deals $303M CHINA 28 companies 35 deals $1.3B ASEAN 13 companies 19 deals $54.6M ANZK 5 companies 7 deals $5.5M JAPAN 3 companies 4 deals $4.9M - Considering currently active companies, independent and acquired - The bubble size reflects the total invested volume between 2010 and 2017 and include the effect of deals >$100M - The invested amount has not been disclosed for 254 deals out of 1,009 (25% of the database) Source: Accenture Research analysis based on data from CB Insights Copyright 2018 Accenture All rights reserved. 5

INSURTECH DEALFLOW THE NUMBER OF INSURTECH DEALS WAS UP +39% YOY IN 2017 CONTINUING WITH THE STRONG GROWTH COURSE OF PRIOR YEARS 89 96 2010-17 CAGR = 52% 2014-17 CAGR = 44% 10 4 5 4 5 13 11 6 13 12 12 14 22 14 21 12 24 28 33 25 33 33 36 50 73 43 67 55 71 76 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 2010 2011 2012 2013 2014 2015 2016 2017 18 deals 40 deals +122% yoy 51 deals +28% yoy 69 deals +35% yoy 110 deals +59% yoy 152 deals +38% yoy 238 deals +57% yoy 331 deals +39% yoy Source: Accenture Research analysis based on data from CB Insights Copyright 2018 Accenture All rights reserved. 6

INSURTECH FINANCING TRENDS Invested volumes totalled $2.3b in 2017, surpassing the $2b mark for the second time after the 2015 $2.7b record. Excluding deals >$100m, the invested volume was the largest in any given year, totalling $1.7b, and above the $1b threshold for the third consecutive year in a row. FUNDING VOLUME (USD M) 1,814 Including deals >$100M 2010-17 CAGR = 49% 2014-17 CAGR = 38% 238 145 Excluding deals >$100M 2010-17 CAGR = 42% 2014-17 CAGR = 24% 500 1,049 839 26 <100M Zenefits Bright Health Lemonade Metromile Oscar 72 25 23 Zhong An Clover Health 58 47 40 Gryphon Insurance Castlight Health 26 32 240 31 44 139 39 107 50 111 463 174 135 180 931 411 316 336 103 400 439 279 160 244 233 326 529 130 160 230 272 669 549 120 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 2010 2011 2012 2013 2014 2015 2016 2017 $145M $171M +18% yoy $348M +103% yoy +45% yoy excl. deals >$100M $334M -4% yoy +35% yoy excl. deals >$100M $882M +164% yoy $2,721M +208% yoy +30% yoy excl. deals >$100M $1,754M -36% yoy -5% yoy excl. deals >$100M $2,316M +32% yoy +54% yoy excl. deals >$100M Source: Accenture Research analysis based on data from CB Insights Copyright 2018 Accenture All rights reserved. 7

VENTURE CAPITAL INVESTMENTS BY INCUMBENTS

INCUMBENT INSURERS VC INVESTMENTS WHEN CONSIDERING BROADER VC INVESTMENTS, INCLUDING INVESTMENTS IN OTHER TECHNOLOGY-RELATED COMPANIES WITH BROAD INDUSTRY APPLICATIONS, THE INVOLVEMENT OF INCUMBENT INSURERS HAS GROWN EXPONENTIALLY OVER THE LAST FIVE YEARS UP +63% BASED ON A SET OF 52 GLOBAL INSURERS PING AN, AXA, BLUE CROSS BLUE SHIELD, AVIVA AND AMERICAN FAMILY ARE THE TOP 5 INVESTORS IN TERMS OF NUMBER OF COMPANIES INVESTED. NUMBER OF DEALS IN TECHNOLOGY-RELATED COMPANIES WITH BROAD INDUSTRY APPLICATIONS WHERE AT LEAST ONE INSURER PARTICIPATED AS INVESTOR 1 481 DEALS BETWEEN 2012-2017 14 20 48 +63% 106 165 161 INSURANCE GROUP # COMPANIES 1 Ping An 51 2 AXA 33 3 BlueCross BlueShield 29 4 Global Insurance Accelerator 25 5 Aviva 24 6 American Family 21 7 MAIF 23 8 USAA 20 9 Mitsui Sumimoto 19 10 Allianz 19 11 MassMutual 17 12 Transamerica 12 13 Prudential Financial 12 14 Assurant 11 15 Munich RE 10 16 New York Life 11 17 Swiss Re 9 18 XL 9 19 Cigna 8 20 Cuna Mutual 8 21 Guardian Life 8 22 Liberty Mutual 8 23 Nationwide 8 24 Northwestern Mutual 8 25 Manulife Financial 6 26 China Life 6 27 CNP 5 INSURANCE GROUP # COMPANIES 28 Intact Financial 5 29 John Hancock 5 30 White Mountains 5 31 AIG 4 32 Hiscox 4 33 Securian Financial 4 34 AmTrust 3 35 China Pacific 3 36 TIAA 3 37 AFLAC 2 38 Allstate 2 39 Hannover Re 2 40 Insurance Australia Group 2 41 MetLife 2 42 QBE 2 43 Sun Life 2 44 The Hartford 2 45 Zurich 2 46 Aetna 1 47 Ameritas 1 48 Beazley 1 49 Generali 1 50 Hanover 1 51 State Farm 1 52 SunCorp 1 (1) Analysis based on a pool of 52 global insurers (2) Considers deals where the insurer is known to have 2012 2013 2014 2015 2016 2017 participated as investor alone or through a consortium (3) More than 1 insurer could have participated in the same investment round. These cases are double counted in the Copyright 2018 Accenture All rights reserved. Source: Accenture Research analysis based on data from CB Insights charts on the right. 9

INCUMBENT INSURERS VC INVESTMENTS INCUMBENT INSURERS ARE LOOKING FOR WAYS TO ROTATE TO THE NEW WITH AN INVESTMENT FOCUS THAT IS WIDE- RANGING AND VERY HETEROGENEOUS, VARYING ACCORDING TO THEIR INSURANCE PORTFOLIO, BUSINESS MODEL AND INNOVATION APPETITE. BREAKDOWN OF INVESTED COMPANIES BY FOCUS AREA 1 437 INVESTED COMPANIES IN 2012-2017 Corporate Social Responsibility Financial Services and Payments Health and Digital Health 14% 9% 3% Other 8% 5% Cyber Security 3% 1% 2% Artificial Intelligence Advisers Enablement 4% 3% Blockchain Investment Advisory Platform 2% 3% Assistance Services Car Marketplace Platform 3% 1% 3% Insurance Core Processes & Services 3% Digital Agency 3% 2% 3% New Insurance Models Booking and Rental Platforms Employee Benefits Platform Digital Marketing Small Business Insurance Digital Vault 13% IoT 9% 4% Big Data and Analytics Smart City Transportation Area 2 Focus # COMP- ANIES IoT Digital Tech 57 Big Data and Analytics Digital Tech 40 Cyber Security Digital Tech 22 Smart City Transportation Digital Tech 17 Artificial Intelligence Digital Tech 11 Blockchain Digital Tech 8 Assistance Services Insurance Core 14 Insurance Core Processes & Services Insurance Core 13 New Insurance Models Insurance Core 12 Employee Benefits Platform Insurance Core 11 Small Business Insurance Insurance Core 7 Digital Vault Insurance Core 6 Digital Marketing Distribution & Marketing 14 Booking and Rental Platforms Distribution & Marketing 13 Digital Agency Distribution & Marketing 11 Car Marketplace Platform Distribution & Marketing 8 Investment Advisory Platform Advisers 19 Advisers Enablement Advisers 4 Health and Digital Health Health 62 Financial Services and Payments Other FS 38 Other Other 37 Corporate Social Responsibility Other 13 (1) Analysis based on a pool of 52 global insurers (2) 22 areas and 53 sub-areas available Source: Accenture Research analysis based on data from CB Insights and a proprietary methodology using a customised Copyright 2018 Accenture All rights reserved. taxonomy 10

DESPITE THE INVESTMENT IN FINTECH, THERE REMAINS A BIG GAP BETWEEN START-UPS AND FINANCIAL INSTITUTIONS Startups Global 2000 Companies Startups High risk High change velocity Delayed economic value Seeks disruption Financial Institutions Low risk Low change velocity Immediate economic value Disruption averse

INTRODUCTION TO OUR INSURTECH INNOVATION LAB

OVER THE PAST 8 YEARS, ACCENTURE S 4 FINTECH LABS HAVE MENTORED 154 STARTUPS LONDON NEW YORK CITY (EST. 2011) 43 Partner Financial Institutions 47 alumni Sample alumni: DUBLIN (EST. 2014) 8 partner banks 18 alumni Sample alumni: (EST. 2012) 23 partner banks / 5 associate banks 56 alumni Sample alumni: HONG KONG (EST. 2014) 12 partner banks / 8 associate banks 33 alumni Sample alumni: OUTCOMES 170+ PoCs initiated $530M Capital Raised post FinTech Lab 490+ Jobs created post FinTech Lab Copyright 2017 Accenture Security. All rights reserved. 13

OUR INSURTECH LABS BRINGS SENIOR EXECUTIVES AND STARTUPS TOGETHER The entire program is driven by the CTOs of global Financial Institutions who choose 8-12 start-ups for the 3 month program It is designed to help start-ups mature their offerings and build valuable relationships with decision makers and investors within the industry WHAT WE DO The objective of the lab is to progress offerings from proof-of-value to proof-of-concept and ultimately to successful commercial development The program has a series of structured activities to create engagement between the start-ups and senior executives from our partners, banks and insurers. Copyright 2017 Accenture Security. All rights reserved. 14

THERE ARE FOUR CORE COMPONENTS OF OUR INSURTECH LABS FINANCIAL INSTITUTION & VC MENTORSHIP EXECUTIVES IN RESIDENCE ENTREPRENEURS NETWORK LEADERSHIP PROGRAM Mentors from at least three of the participating financial services firms technology teams and interaction with the participating VC firms Access to users / business units within the financial services firms for product feedback Current or former executives with backgrounds in various disciplines (e.g., technology, business, regulatory) May also include members of the academic community (e.g., data science, Artificial Intelligence) Opportunities for one-onone mentoring sessions with FinTech and InsurTech entrepreneurs Entrepreneurs are paired with startups based on area s of expertise Weekly sessions on issues relevant to early stage companies (e.g. procurement, POC, regulation) with experienced entrepreneurs and/or senior executives from the financial community Copyright 2017 Accenture Security. All rights reserved. 15

WE ARE IN THE PROCESS OF ROLLING OUT OUR INSURTECH LAB IN NEW YORK CITY 2011 2012 2014 2017 New York FinTech Lab Launch London FinTech Lab Launch Dublin & Hong Kong FinTech Lab Launch London InsurTech Lab Launch New York InsurTech Lab Launch Areas that will be of interest include: Leveraging new data sources for underwriting and claims Applying artificial intelligence to the underwriting and claims process Facilitate a benefits marketplace Develop new products for microbusiness and large employers Tackle core infrastructure tools (cybersecurity, cloud enabling) PARTNERS Copyright 2017 Accenture Security. All rights reserved. 17

IN YEAR 1, WE RECEIVED 96 INSURTECH APPLICATIONS FROM A DIVERSE RANGE OF OFFERINGS Insurance Type FinTech (106) 52% Applications Both Tracks (68) 34% P&C 29% Life 2% Both 69% 14% InsurTech (29) 7 InsurTech Finalists competing for 4 openings

IN YEAR 1, WE RECEIVED 96 APPLICATIONS FROM A DIVERSE RANGE OF OFFERINGS Claims Assessment 3% Regulatory & Compliance 4% Distribution 4% Underwriting 6% Security 3% Talent Management / HR 2% Emerging or under-served risks 16% Claims Assessment 4% Process automation 7% Emerging or underserved risks 7% Talent Management / HR 3% Customer Management 17% New products 9% Process automation 16% Underwriting 10% Distribution 14% Claims Processing 10% New insurance models 12% Customer Management 15% Claims Processing 10% New products 14% New insurance models 14% Copyright 2017 Accenture. All rights reserved. 19

TOP 50, 25, 10 APPLICANTS BASED ON APPLIED TRACK AND OFFERING AREA Applied Track Insurance Product Focus 60 60 50 50 40 40 30 30 20 20 10 10 0 Top 50 Top 25 Top 10 0 Top 50 Top 25 Top 10 Both InsurTech Track Both P&C Life 60 50 40 30 20 10 0 Enterprise Customer Top 50 Top 25 Top 10 Both Retail Commercial Copyright 2017 Accenture. All rights reserved. 20

OFFERING FOCUS AREA BY TOP APPLICANTS Focus Area 10 9 8 7 6 5 4 3 2 1 0 8 2 1 5 4 3 2 1 1 7 9 6 6 2 6 3 2 2 1 1 1 2 5 2 1 1 1 0 0 0 0 0 0 Top 50 Top 25 Top 10 Copyright 2017 Accenture. All rights reserved. 21

TECHNOLOGY FOCUS AREA BY TOP APPLICANTS Technology Focus 30 28 25 20 21 25 25 15 13 14 13 10 5 0 9 5 1 0 0 8 5 2 5 5 5 2 1 3 0 0 6 2 1 9 4 4 1 4 0 0 6 3 1 1 2 0 0 0 0 Top 50 Top 25 Top 10 Copyright 2017 Accenture. All rights reserved. 22

SAMPLE FINALIST INSURTECH FIRMS FOR THE 2018 COHORT Underwriting Under Served Risks Smart cities are producing data curates feeds of city data and delivers predictive insights that markedly enhance risk assessment of prospective policyholders, leading to better risk selection and informed underwriting.. Iot New Insurance Models IoT sensor technology and AI driven cloud computing, company can collect, analyze and deliver actionable insights about how to mitigate the injury risk inherent to manual materials handling positions. Data Science Enabled Efficiencies Enable carriers to underwrite commercial risk with just business name and address of the insured. Our underwriting platform uses data science to eliminate administrative burden associated with insurance application / submission processing, and supercharges underwriting decisions by analyzing and synthesizing risk characteristics from a broad array of external data sources. Customer Management New Insurance Models Insurance companies leverage access to real time consumer data to create better customer profiles and ultimately improve underwriting. With customer consent, we access user data through connected home devices and smartphones and combined with contextual data we translate this into behavioral profiles. Insurers use this data to improve underwriting models and promote additional services (security, health monitoring etc) to their customers. Copyright 2017 Accenture Security. All rights reserved. 23

FEATURED INSURTECH STARTUPS

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