Stonestep: delivering bancassurance for the unbanked with Microinsurance as a Service
Stonestep serves first-time, even first-generation, insurance consumers in emerging Asia through its distribution partnerships with mobile, retail, and non-bank financial channels. It solves supply-side constraints by establishing in-country services driven by bespoke IT. It elucidates unexpressed customer demand with hybrid assistance and insurance products. The products aim to be as easy a pack of gum to understand and sold at the same newsstand at a similar price point using Stonestep’s apps and connected platform.
Stonestep is headquartered in Switzerland’s ‘Crypto-valley’ and operates in Malaysia, Myanmar, Nepal, and Philippines. While Stonestep’s footprint indicates where it is going, its headquarters underlines the role it sees for technology in getting there. The diverse markets test and prove the replicability of Stonestep’s model:
- Malaysia is higher income and uses takaful in addition to life and general products
- Myanmar compares to an earlier Thailand and has potential to evolve rapidly
- In Philippines, a population one third the size of Brazil’s lives in an area roughly the size of Sao Paulo
- Nepal shares important features with neighboring India and invites / requires innovation.
The combined GDP of these markets lies between Switzerland and Netherlands, but their population is 10x larger and map a footprint through high-growth areas. McKinsey projects that by 2025, ½ of all global “emerging consumers” will live less than a 4-hour flight of Yangon.
Access to more than 20m customers
Across markets, Stonestep counts 25 professional staff and growing. It has access to more than 20m customers through partnership deals which include a Mobile Network Operator, Mobile wallet, retail pharmacy chains, and Microfinance institutions. Stonestep has existing integrations with these partners for quick product cycling and Stonestep provides front/back office. In Myanmar and Nepal, Stonestep additionally benefits from multi-year financial and strategic support from UK AID. By year-end 2018, Stonestep plans to double its offered products from 3 to 6 and, at the request of its partners, it is looking at two additional markets.
Stonestep’s first financing round raised US$4m from XL Innovate and, while arm’s length, the company enjoys good support (and works with XL’s fronting carriers in several markets). In addition to winning the two competitive grants during 2018, Stonestep was selected as a finalist for Swiss FinTech of the year.
How it works
With premiums collected in increments as small as US$0.02 and claim limits as low as $10, efficiency and scale are givens in Stonestep IT. In October, it launches its 2.0 version of its core platform together with connected sales and service android apps. The “Eiger Platform” builds on Stonestep’s team’s experience developing solutions for mass consumer at major insurers. Eiger handles partner, policy, VAS, CRM, network, claims, and reporting in multi-language, multi-currency, and for Nepal multi-calendar. Innovations in the new version focus on subtle gamification to encourage constant improvement in customer interactions.
Why we selected Stonestep for DIA Munich
DIA selected Stonestep to speak because it fulfills a new role in the value chain, especially in its markets and segment and because it exemplifies the contextual ecosystem approach we identify as a major trend for 2018: tailoring product to channel and to moment of truth. Industry short-hand doesn’t quite capture what Stonestep does. It is an affinity specialist which integrates with distribution and provides all of the IT and backoffice required to run the business.
At DIA Munich Brandon Mathews, founder & CEO showcased Stonestep’s Eiger Platform and Agent Sales app. Both are new releases and incorporate gamification to encourage continuous improvement in customer interaction.
Who is Stonestep?
Stonestep was founded in Switzerland in October 2012 and originally bootstrapped as a consultancy, delivering major projects for leading insurers and brokers. It was founded by Brandon Mathews who previously established microinsurance for AIG and Zurich in LatAm and globally. The core IT has been developed by his long-term colleague Renata Rego who has led design and development of IT and Operations in multiple countries with Brandon. Brandon and Renata were soon joined by Brandon’s brother, Alex, who had been managing utility-scale solar and wind development projects for Toyota division in San Diego California. He moved to Dar es Salaam Tanzania then Accra Ghana then Yangon Myanmar and now Kuala Lumpur Malaysia for the business. The management team has grown and strengthened from there.
The number 1 or 2 in each market is local. They believe claims should be paid with the same currency that their team buys its rice/bread with.
XL Innovate, the GP to XL Catlin’s LP, is their sole external investor. They raised US$4m from XL Innovate in December 2016. Sarah Street, XL’s previous Chief Investment Officer, is a board director and Tom Hutton, previously on XL’s main board and CEO of RMS among others, is a board observer.
Stonestep staff speaking with a shop customer in Yangon, Myanmar.
”We named the company Stonestep because people need to secure their climb into economic well-being and companies need proven practical steps to make it happen.” Brandon Mathews, CEO Stonestep