Strata has helped Riskwolf to secure funding from the Swiss Innovation Agency (Innosuisse) through the competitive Swiss Accelerator.
Weather events, IT outages and cloud downtimes have important consequences for both individuals and companies. While climate change is increasing the number of floods, fires and extreme or unpredicted weather events, the amount and negative impact of cyber attacks is reaching unprecedented scale.
Insurers are re-evaluating their products and in some cases even refraining to provide insurance when unable to properly evaluate the risk.
In order to avoid this situation, Riskwolf has come up with a solution: with unique real-time data and dynamic risk modeling, they enable insurers to build and operate parametric insurance at scale. Riskwolf’s platform automates the creation of new insurance products from ideation through incubation to market, so that a wider range of products can be structured, priced and operated reducing the need of specialists and expensive multi-year IT projects.
Riskwolf platform is reshaping the insurance industry and has been recognized as one of the 100 Most Innovative InsurTechs in the World by FinTech Global.
Starting point
Riskwolf’s team has been working in the insurance sector for more than 20 years. Five years ago, Riskwolf’s founders Thomas Krapf (CEO) and René Papesch (CTO) saw a clear opportunity.
“Basically, the idea of Riskwolf was to bring more direct insurance models into risks that are emerging like cloud technology. That was our starting point”- explained Thomas.
Following this idea, Riskwolf brings together the data, the monitoring of the risk (i.e. the cloud and internet monitoring), together with the modeling. Insurers are then provided with a platform where they can produce insurance contracts.
“We built up this tool in 2019-2021, when COVID happened. We saw there was a greater need for digital support and a huge risk around cyber and cloud problems which was disrupting a lot of business models that are online”- claimed Thomas.
A second pillar for Riskwolf are weather conditions. As stated by Thomas, “due to climate change, the past weather events are not predicting the future weather patterns anymore, which means you need a more scalable model. The parametric model can help to better understand weather risks”.
Obstacles, Opportunities and Goals
Riskwolf focuses on two topics: on the weather side they have existing programs already acquired, especially in Asia, around weather crops, which help farmers get insured against sudden weather events. In the travel and event industry, they are also embedding weather coverages in travel tickets. On the cloud side, they are focusing on building up a certification and a monitoring approach which is accepted by the industry.
“There is a big opportunity around embedding more insurance products into normal consumer journeys, for example, when people go to a ski resort and they have to close it down for a couple of days due to heavy rains. We see a huge demand in embedding small guarantees in this type of travel-event journeys”- claimed Thomas.
However, their journey did not come without difficulties since insurance involves many different parties: buyer, broker, local insurer, global carrier, etc. “The orchestration of that is pretty complex because you may have the best product, but if one side moves away and does not take part, then it will not work. There is a lot of orchestration effort to bring all these parties together”-explained Thomas. Regulations are also a complex and challenging matter given that a local insurer is always needed.
“We want to build a B2B service for insurance globally, so that we can really provide Riskwolf capability to any insurer in any country, in any jurisdiction, with any distribution channel to give them the ability to build products for the global market”- stated Thomas.
And apart from these specific difficulties, cash is always a challenge for any startup:
“Moving our model to profitability is definitely a topic that is at the core of our thinking”- agreed Thomas.
Riskwolf experience with Innosuisse
Riskwolf has become one of the latest Innosuisse Swiss Accelerator winners, a programme that will support their roadmap for the next 2 years.
“The program is extremely helpful as it gives us the opportunity to build our product for market and technical readiness by 2025 and enables us to discuss certain topics with insurers. We have already had roughly 30 interviews with experts, with whom we are engaging on the cyber and cloud topics. We are also building up a panel of experts and stakeholders who are helping us to shape the product. We expect to move our product into the market by 2024 or 2025”- said Thomas.
Riskwolf and Strata collaboration
“For me it has been extremely helpful to work with Strata because they have the experience that is required to structure this type of application; Strata’s team know the typical challenges, and what works and what doesn’t. They also have challenged us to fully understand our project, to keep it simple and to frame it so that it can be easily understood by evaluators.
Strata also gave us a service when we needed it, so as a startup we have found this collaboration very helpful. We were successful so it has been a very good partnership; we are thankful for having Strata supporting us in this process”- concluded Thomas.
