By: Shane Curran, co-founder of InvestSure
InvestSure’s first quarter in operation has been an incredibly exciting time. We managed to launch a world first insurance product on Easy Equities, one of South Africa’s most innovative and fastest growing trading platforms; backed by a trusted insurer in Compass Insure and reinsured by one the biggest players in the world. It has been amazing to see the technology we developed over the course of a year start to deliver on our promise of a transparent and admin free insurance experience.
We’ve made good progress in our mission to enable South African’s to invest with increased confidence. To date hundreds of Easy Equities clients have recognised the value in this new product, many of who have purchased multiple covers.
Along the way we’ve managed to bust some myths, validate some views and take some learnings as well.
The highlight reel:
1.These type of things don’t happen often
Incidence of accusations for wrongdoing being levelled against management is on the rise, driven by a number of trends such as increased access to information, the rise of activist investing and high levels of pressure to outperform on a quarterly basis amongst others. This increasing trend was evident in the months before our launch date in May and has continued since we launched. We’ve listed 6 insured events on our Newsboard (https://nb.investsure.info) since launch including household names like Glencore, Capitec, Sibanye and Naspers. The Glencore event which also triggered our first paid claim wiped off over R140 billion from the companies market cap, impacting thousands of innocent investors!
2.People don’t buy insurance only for the usual suspects
Not everyone is rushing to insure the outsized companies in the JSE such as Naspers and BAT nor are people necessarily only insuring the “bad” or “risky” companies with a poor reputation (I won’t mention names). In fact we have seen a significant amount of diversification in the companies people choose to insure, indicating that investors are wise to the pitfalls of trying to pick which companies are riskier than other. Trying to anticipate where fraud will come from can lead to investors being blindsided. We have seen insurance taken up on 87 different shares thus far representing a good spread.
We got off to a great start with over 650 purchases in the first 75 days. Importantly we’ve welcomed new clients (new policies) every day since launch! Month on month growth from June to July is 63% – a really exciting stat showing that more investors are seeing the value offered by InvestSure.
Many of our clients cover their other shares after their first insured purchase, indicating that our clients are seeing InvestSure’s product as part of their overall investment strategy. The repurchase rate for May and June already stand at 34% and 40% respectively.
We’ve had really positive engagement with the public across social media, giving us the opportunity to clarify the product, tweak our messaging and get some love from the public. It’s been really heartening to get such overwhelmingly positive feedback from potential customers.
Interestingly the majority of our clients are male, which is in line with the Easy Equities clientele spread (see #JSESheInvests on Twitter). The picture looks much more balanced age wise, with the value and number of transactions spread across the spectrum and in line with our countries youthful population.
7.The highlight of the quarter must be paying our first claim, in what we believe to be a world record 45 seconds from the time the client suffered the loss, without the client even needing to register a claim! It’s amazing to think that this product didn’t exist anywhere in the world just a few months ago and many investors had no economical viable and accessible way to protect themselves from the growing risk of management fraud and dishonesty.
What a quarter it’s been, InvestSure is up and running having brought something completely new to the insurance world – which doesn’t happen often in centuries old industry! We are proud of what we’ve achieved thus far and look forward to helping more investors manage their exposure to this incredibly difficult to predict or price for risk.
Fraud is like a thief in the night, one never knows where it will come from, or when and how devastating it will be; InvestSure clients sleep a lot easier.