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The Digital Insurance Assistant for European consumers

Periodic Reporting for period 1 - BRAIN (The Digital Insurance Assistant for European consumers)

Reporting period: 2018-07-01 to 2018-09-30

Have you ever paid for extra insurance when renting a car without really understanding whether you certainly needed it? Do you know if your homeowner insurance will cover goods stolen from your car? What is included in your credit card insurance policies? Consumers are vastly uninformed when it comes to contracting insurance and using their coverages. Although the average insurance cost per capita in the EU is 2,670€ per year, European users do NOT have the tools to easily compare, select and buy the best insurance policies; those that provide the best insurance coverage at the best price. Furthermore, insurance policies are usually difficult to understand and cumbersome to manage. Switching insurance providers is generally considered to be an annoying, elaborate and repetitive process that involves comparison of service contracts, features and pricing, followed by the bureaucracy of the actual transition between providers, and if that is not enough yet, the entire process starts all over after the contract ends.

BRAIN is a digital insurance advisor that helps users find the cheapest and most adequate insurance package and understand how they are covered in day-to-day situations. Our platform allows consumers not only to compare and acquire insurance contracts reducing 35% time and 20% insurance costs but also helps them to understand how they are covered. Furthermore, its AI-advisor supports an interactive user experience. BRAIN also represents a powerful and effective digital channel for insurance providers to reach new consumers, as well as increase customer loyalty and thereby reducing the churn.

The objective of the feasibility study is to guarantee the commercial success of BRAIN. This encompasses technical, financial and commercial perspectives, all of which we aim to evaluate in this Feasibility Assessment, to minimise the risk of failure and improve the chance and impact of success.
Thanks to receiving the Phase 1 grant, we have performed a thorough feasibility study with a full and robust market-oriented approach. Upon concluding our research, we have decided to continue with the BRAIN project. Our technology roadmap is entirely feasible, including the improvement of our current platform and adaptation for major scalability, machine learning developments, architecture internationalisation and languages as well as other modifications to adapt BRAIN for its international commercialisation. Our objective of developing an online platform providing clear information about insurance policies, user-friendly offer comparison, an easy insurance purchasing process and recommendations to improve coverages has been mostly achieved. We still need to work on the development of machine learning algorithms, including new features in our platform, and adapt our current solution for its international roll out; by doing this during Phase 2 of the project, we are convinced we will achieve all our technical objectives and therefore the readiness of our product to be commercialised.

Our in-depth analysis of the insurance market has given us details of the projected revenues for the coming years in Europe, where our initial target markets are. A comprehensive patent search relating to BRAIN innovations has been undertaken, having confirmed that the project’s results can be exploited freely and further protected. This gives us the freedom to develop and sell our new technology as an innovation which is not currently available in the insurance market and should help us to penetrate our targeted market and countries.

From a financial point of view, we have validated the financial business model with a profitable average gross margin of 65%. We foresee to apply for Phase 2 SME Instrument call next October, in order to complete the project financial needs and reach BRAIN’s commercialisation stage.

Thanks to the H2020 SME Instrument Phase 1, during the last four months we have been able to validate the technical, commercial and financial viability of our novel technology. This Feasibility Study reports the results of the three tasks proposed during the Phase 1 proposal:
Task 1: Technical feasibility assessment: We have identified the technical tasks that we have to accomplish to have a fully operational version of BRAIN. We have outlined a technical plan, which, among other things, will allow us to modify our system architecture, to guarantee the future scalability, and the fine-tuning of our machine learning algorithms. It includes several developing and testing steps and will define all language modifications regarding our international market expansion. We have paid particular attention to those technical risks that could compromise the successful development of BRAIN. We have quantified them with a proper risk assessment methodology and have proposed mitigation measures to reduce the risks.
Task 2: Commercial feasibility assessment: We have analysed the digital insurance brokerage market by identifying our potential end users and their needs. Next, we have paid attention to the global market and have decided on our targets and our penetration strategy. We have also listed and studied our main competitors, including aggregator sites and mobile applications in all market segments and their strengths in the market. Finally, we have elaborated an IPR-analysis to guarantee Freedom-to-Operate for BRAIN;
Task 3: Financial feasibility assessment: Our financial plan includes performing a full cost/benefit analysis, in which we have evaluated the total investment required to achieve the technical developments, prepare the commercial exploitation strategy and validate the economic implications of agreements with insurance companies.
The uniqueness of our platform relies on the following technical features:
1.The user app: An extremely user-friendly app.
2. Our Policy logging system: An effective system to log policies into our system which we will adapt to other countries.
3. Syntax analysis (parser).
4. Advisor based on machine learning algorithms.
The objective of the BRAIN project is to bring BRAIN to the market. In this study we have evaluated the technical viability of BRAIN, focusing on: i) Defining the required modifications to our system architecture to allow for the necessary, future scalability ii) Determining the steps needed for the fine-tuning (development and testing) of our machine learning algorithms; iii) Evaluating the compatibility of current functionality and design for international rollout; iv) Assessing the language modifications to the system upon market expansion and v) Generate a detailed technical risk assessment.

We have already launched a first product providing a comparison service to the Danish market, having successfully reached 25,000 satisfied users during the first six months; we have also signed commercial agreements with the most relevant insurance companies in Denmark. On the one hand, we want to offer an AI-powered app-based intelligent assistant to European consumers, being able not only to compare prices, but to offer comprehensive plain information and buying functionality. On the other hand, we expect to internationalise our customer base entering Norway, Denmark and Sweden in a first phase. Successful implementation of this expansion project will result in growth of our company with 50-70 employees.
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