Pooling and repooling risk: The limits of Insurtech platforms in inclusive insurance

Abstract

This article investigates the promise of Insurtech to expand the frontier of the insurance market to include vulnerable populations around the world. It contributes to current debates on the proliferation of new technologies for financial inclusion as embedded in contemporary forms of platform-based capitalism. We argue that Insurtech’s promises fall short of expectations because of the contradiction between the principles of platform scalability and insurance risk pooling. Such contradictions lead Insurtech platforms to unpool risk rather than provide innovative technologies to pool it. This ultimately limits the expansion of markets for inclusive insurance as Insurtech platforms struggle to scale up the market through their supposedly disruptive technology. Our analysis draws on a range of regulatory reports, complemented by in-depth interviews with Insurtech executive officers. The article offers insights into the contradictory principles currently driving the digital inclusive insurance market, as well as the limits to the ongoing global expansion of platform capitalism.

Keywords

• financial technology
• inclusive insurance
• Insurtech
• platform capitalism
• risk