BGL Group has spent 27 years becoming European insurance royalty. Now the Peterborough, UK-based fintech unicorn, with offices spread across the continent, the company’s CIO explains that BGL is perfectly positioned to lead insurance into a new generation of smart, deep tech solutions–while mitigating the political roadblocks insurance often faces.
When Douw Steyn founded what would become one of the world’s most important insurance companies in 1992, his industry was almost unrecognizable from that of today. Things were more stable: there were no financial crashes and business models were relatively comparable between companies. Regulation was simpler and offline. Technology was deeply limited.
Fortunately in Steyn, BGL–then the Budget Insurance Company–had a leader who reveled in change. In 1997 the firm shifted its focus from underwriting to insurance distribution. From then it continued a path of regeneration, acquisition and revolution, buying brands like Arnott Century and Dial Direct to create an encompassing insurance provider working in a multitude of verticals.
In 2002 BGL’s partnerships business Junction was founded, and became the biggest firm of its kind in the UK. And in 2004 BGL birthed its most iconic wing, comparethemarket.com, an instantly recognizable website represented by the iconic meerkat Aleksandr Orlov, whose quirky ads have bolstered the firm’s fortunes since 2009.
It wasn’t until 2010 that BGL began acquiring abroad, buying French outlet Courtanet–now LesFurets.com. BGL had pioneered the price comparison market for insurance, something few firms managed to master. Today Steyn’s company is considered a behemoth of the field, offering car, home, life and other insurance. Technology is becoming an even more integral part of the business.
“AI and deep learning will have profound effects on many industries,” BGL Group CIO Stuart Walters tells Red Herring. “Insurance and financial services more broadly will be no exception: Realtime personalization through advanced data platforms; cloud computing for scale and software speed to market. Finally, cyber security skills, controls and culture will be increasingly important in a heavily regulated industry which manages and processes sensitive customer data.”
Big Data has been transforming the insurance industry for years now. As ever more data subsets are collected and collated, companies like BGL Group are sitting on piles of potential AI profitability, in an era when being small doesn’t necessarily help an insurance firm fight its biggest incumbents. Perhaps that’s precisely why Walters, a longtime agile entrepreneur, was brought onboard by BGL in 2013.
Walters knows how to modernize legacy platforms from previous work at travel brands like Worldhotels and Opodo. Insurance is a more complex problem. “Certainly some of the back office platforms in the insurance industry are old and sometimes more difficult to change,” he says.
Most of BGL’s tech is much more recent, however, adds Walters–and where the firm has rich features embedded in older platforms, the company has adopted a “state-of-the-art modernization approach which minimizes change to older codebases, but still enables us to respond rapidly to customer demand, and to integrate and leverage modern tech and platforms.”
In October last year BGL acquired Bean, a personal finance app, to do just that. Walters has overseen an international tech expansion, too: BGL is still headquartered in Peterborough, a historic city of 200,000 people 75 miles north of London. But its chief UK tech team is based in Shoreditch’s so-called “Silicon Roundabout”, in the heart of the British capital. And with additional offices in Peterborough, Sunderland (UK), Paris and Minsk, Walters says, “our diverse sourcing strategy helps mitigate any risks arising from country-specific macro-political issues.”
Not that Walters, nor BGL, is rushing into insurance’s Next Big Thing: AI. insurance regulation is dense, and liable to change across borders on a monthly, or even weekly, basis. With BGL’s portfolio performing so well, there’s no need to risk anything to move into a tricky and liable space.
“Without a detailed understanding of how to engage with customers and understand their complex and personal financial needs, and expertise in the deep and customer-centric regulation in financial services, implementation of advanced technology such as AI is unlikely to be successful and could well be non-compliant,” says Walters.