Most of the premiums in property & casualty insurance go toward paying for claims handling and indemnity, reaching up to even 80% in the UK. Spanish insurtech startup Bdeo is slashing such costs, by automating the claims process through a combination of video streaming and AI, and speeding up the process by up to 80%, it says.
The result is remote assistance for motor and property insurance claims through a visual intelligence engine that provides video evidence of the damages, reducing fraud too.
Founded two years ago by two insurance business veterans, Julio Pernía and Manuel Moreno, Bdeo was named Most Disruptive Startup at South Summit Madrid earlier this month, on top of winning the fintech and insurtech category. The company launched in the market in early 2018, targeting insurers across Spain, Portugal and Latin America.
The co-founders "thought that a remote video assistance would optimize claims management, saving costs to insurers as well as saving time to the insured," Ruth Puente, Bdeo’s COO, told CompassList at the South Summit. Besides, about "70% of claims in general are only minor claims that can be easily assessed using technology, without the need of a person present."
The startup also wants to expand further, into the rest of Europe and the US over the next two years, she said. And so, it's working to close a Series A funding round by the end of 2019 that will include an international investor, to finance such market expansion and improvements to its AI technology.
Live video verification
Having spent more than a decade working in the insurance sector, Pernía and Moreno, Bdeo's CEO and CTO, respectively, spotted an opportunity in a market that was struggling to manage its claims workload. The name Bdeo was chosen because it sounds like “video,” which is the core technology deployed in its SaaS platform.
The process, Puente said, is fairly simple. When an insurer receives a claim, the platform automatically generates a hyperlink and sends an SMS to the client’s mobile phone to start the video examination process. Users don’t have to download an app; by clicking the link they are automatically redirected to the Bdeo platform.
At this point, a geolocalized video call asks the claimant to provide details of the damages and visual proof. Through AI and blockchain technology, the platform verifies and validates the information provided by the claimant. It next automatically sends a detailed report to the insurer or fleet management company with the video evidence for the insurer to immediately process the claim.
The process has also been designed to eradicate fraudulent claims from vehicle workshops, which, according to Puente, are rampant across Spain and Latin America. “We verify that all pictures are coming from the same vehicle. Everything has to be done live; uploading photos from a mobile phone is not supported,” she said.
Rapid growth amid challenges
Bdeo has offices in Madrid and Mexico City but its operations are spread across Spain, Portugal, Switzerland, Germany, Mexico, Colombia, Guatemala and Costa Rica. The company sells annual subscription plans to license the use of its SaaS solutions for policy issuance, claims management, remote customer assistance, damage assessment and cost estimation.
To date, the startup has 16 clients and is running three pilot programs. Its portfolio includes big names in the industry, such as Zurich Insurance, Mutua Madrileña and Fidelidade in Spain, Chubb and BBVA in Mexico, and HBI in Colombia.
“Latin American countries have been key markets to test our product as their claims management systems are extremely inefficient," Puente said. "For example, in Mexico, when a car accident happens, the vehicle cannot move until its insurance adjusters arrive and the wait can be very long."
Although the company has expanded rapidly, with monthly recurring revenues (MRR) increasing fivefold month-on-month since the beginning of 2019, it has also faced some challenges.
“The biggest challenge for us has been dealing with big corporations as their policy sales process can take very long, sometimes longer than a year,” said Puente. “Such timing is not aligned with startups’ pace, where we are move fast and we expect results even faster”.
Bdeo is also working hard to redress an imbalance in its performance. “We have worked very well in the motor claims segment, but we need to strengthen our position in property claims,” she added.
Limited competition
In 2017 the company won multiple competitions around the world, from the Startupbootcamp Fintech in Mexico to the Innostar Competition in Shanghai. In 2018, the company won the South Summit competition in Mexico, clinching almost immediately its first Mexican angel investor. The funding obtained was used to develop deep technology and to support the launch of its first pilot program.
In April this year, the company closed a seed funding round of €1m from K Fund and Big Sur Ventures. "We are extremely happy to have them onboard. Both funds are very well known for supporting startups throughout their journeys and they are actually helping us a lot with advice and mentoring,” said Puente.
Next year, besides expanding to other parts of Europe, Bdeo wants to secure a leading position in Spain.
With only a few similar players operating mainly in the UK, US and Asia, Bdeo's competition is still limited. However, whether the startup can meet its goals also would depend on other players in the industry – insurers will need to want and be able to adapt their processes fast enough to embrace Bdeo's technology and new ways of handling claims and indemnity for the insurtech disruption to stick.
