As another year winds down, I figured it was time to describe my latest venture and undertaking as the Chief Technology Officer of Ronoco.
Ronoco focuses on technology for the insurance industry. Unlike most of the “value adds” I’ve seen out there, Ronoco is not another fancy chat bot to try to improve a claims process, or, another analytics tool that obsessively tries to create “useful” insights out of a trove of noisy data. Ronoco is solving a real fundamental issue – how can people manage the growing complexity of risk.
What is Insurance?
Before diving directly into risk, let’s start with the basics of “what is insurance?” To most, insurance is a required burden – just an additional useless fee like taxes – to perform an action (i.e. Auto Insurance to drive a car). What most don’t realize (or choose to ignore) is the fact that insurance is a complex instrument that’s designed to provide tremendous value when you most need it. Insurance really is peace of mind.
Managing Risk In An Ever Growing Complex World
The peace of mind is in the fact, that in the event of some kind of loss, you can be made whole. Insurance therefore is just a bet against or for (depending on the side of the relationship you are on) the probability of a loss – this in turn is the overall risk of loss. For example, the insurance carrier is betting you $200 that nothing happens (the premium). If something happens, they will pay out $2000 to replace the loss (the claim).
Now without going into the math and boring most of you, the tldr; for all of this is, the more people that participate, the lower the premiums as the overall risk is now spread across more people through all the premiums that are being paid. People though underestimate the level of risk they have, don’t buy enough insurance, and end up either taking a loss and/or causing premiums to increase do to the reduced number of people that are participating to spread the risk across.
How Ronoco Helps
Ronoco is designed to help a person navigate the complexities of risk and identify where they aren’t providing themselves enough coverage to protect themselves from losses. Working with their insurance agent (note: not an AI) a person will be able to get a better understanding of their risk portfolio and be able to adjust their insurance policies accordingly. Not only for personal use, but also for commercial use, the software seeks to help increase efficiency in the communications between agents and their clients. By moving away from complex spreadsheets and paperwork, agents and clients can begin to sort through the complexities of risk and help them visual such an abstract concern.
Why Limited AI?
The biggest growth place in technology over the last few years has been in Big Data management which has led to an abundance of AI, Machine Learning, Deep Learning, Neural Networks, and other kinds of applications. Here at Ronoco AI is not the ultimate solution, but a part of the overall team that supports the client. Insurance at multiple levels is not just about the raw numbers, but also the relationships. By removing the autonomous tasks from the agent’s workload, they can focus on the relationship building and also the advisement side rather than being a policy producing jockey.
Over the course of a couple of months the technical infrastructure, operations, and code base have all grown significantly. Some key points are:
- 20% Month over month growth of the code base
- All build and deployment processes are all automated on AWS infrastructure
- Development team has grown over 100% in size in the last few months
The core application code is being redesigned with a new microservice architecture to improve scalability and development agility. Along with using AWS to manage the underlying server based infrastructure, we’ve been able to minimize costs while maximizing computing capabilities. In the next few months I hope to add additional functional capabilities through an additional platform tool (right now it’s under wraps). While I’ve managed and have developed large scale products in the past, the development team has managed to carry an even faster and more brutal pace than I’ve ever experienced.
Thoughts and Open Questions
While this adventure has been a wild ride, there have been many opportunities to learn and there are still may open questions that I’m faced with. Insurtech, though a subset of the larger Fintech industry, is becoming its own beast and earning its own seat at the larger table. This has definitely changed the equation and begs the question if it should be on par given its own complexities in business processing due to the addition of having to adjudicate claims.
The majority of the questions left open revolve around being able to grow the business efficiently. While the company has its HQ in CT, the decision was made from the start to base most of the technology out of Boston for now. Even with investments into the ecosystem I’ve seen from groups like CT Innovations and Hartford InsurTech Hub, the market looks relatively soft in the home state. With engineering shortages well-know in Boston, it makes for an interesting problem when trying to forecast how fast and furious hiring can be. Is there a real possibility of having more spots than we can fill? Yes, and that’s a very scary position to be in when looking to grow.
Over the next few months and hopefully years, I’ll be providing updates periodically on our technology, architecture, strategy, and much more. If you have any questions, comments, network opportunities, and/or concerns please don’t hesitate to reach out.