A former HSBC insurance CEO started his own insurtech firm. It’s already profitable.

Singapore Life’s office used to belong to a shipping company. When the insurer moved in two years ago, they left all the fixtures in place – part of its relentless drive to keep costs down. The only concessions to the new business are a lobby, painted and tiled in Singapore Life’s red-and-white color scheme, and the conversion of the old server room into a wine cooler.

Founded in 2014 by Walter de Oude, the former CEO of HSBC’s Singapore life insurance business, Singapore Life was the first new local life insurer to be licensed in Singapore in nearly 50 years when it was given regulatory approval in 2017.

Convinced that the insurance sector was ripe for disruption, de Oude turned down a more senior role at HSBC to launch Singapore Life.

People are abandoning their loyalties to the incumbent financial services and becoming increasingly comfortable with making major transactions online. “Customers will switch between providers at the drop of a hat,” de Oude claims. “But the ability of these massive organizations to pivot to capture some of this stuff is a challenge.”

He argues that these companies are simply pushing products to the person on the street, rather than collaborating with them. The digital age hasn’t changed that.

Flush with investment, Singapore Life is now looking to expand regionally and acquire other startups in a bid to capture a larger piece of the financial services market.

According to Tech in Asia’s data, the company raised one of Southeast Asia’s largest series A rounds in April 2017, picking up US$50 million from a group of investors led by Impact Capital Holdings and London billionaire Michael Spencer (through his private company IPGL). Some of that capital went into acquiring Zurich Life Singapore’s portfolio, which gave Singapore Life S$6 billion (US$4.4 billion) worth of policies.

IPGL acquired a majority stake in the company last year, putting in another US$52 million. Moreover, US insurer Aflac invested US$20 million in December 2018, valuing Singapore Life at more than US$200 million. Aberdeen Standard Investments – one of the world’s largest investment companies – took a US$13 million minority stake in January 2019.

Beyond insurance

Singapore Life’s pitch to investors is that traditional players see life insurance as a one-shot deal, where they sell a customer policy and leave it at that. The company uses customer-facing dashboards to let policyholders understand their coverage. It also has technology tie-ins. For example, customers can register their wearable devices with the company and earn cashback for hitting step counts and physical activity goals.

“The incumbents have realized that they have to figure out a way to deepen their relationship with their customers,” de Oude says. “Some companies have gone with health-related benefits that they can add on. Some companies have gone with reward points. Other companies have tried a credit card type of engagement relationship. And these have worked in various degrees of success […] but I personally don’t believe you buy life insurance to get a discount on your gym membership.”

Other insurers have set up digital channels or subsidiaries, but these, he believes, are just digital skins for business-as-usual. “They’ve really just taken traditional products and services and stuck them on a website without being able to include them into an ecosystem that is going to change the customer’s experience,” he says.

The company is now looking to broaden the range of its offerings. “I believe that the verticals between financial services [are] blurring. We see insurers being able to operate in the asset management world. We see neo-banks and stored value cards operating in a banking world,” de Oude says. According to him, Singapore Life’s financial and regulatory backing will allow the company to “push boundaries.”

The company also aims to build a deeper financial relationship with a customer – whether through savings, investments, or transaction services such as cards. De Oude says that a regulated, well-funded business like Singapore Life has an automatic advantage over the existing players in the fintech space.

In the black