AI Wisdom Ep. 14: The Impact of Digital Ecosystems on Insurance with Mike Connor

Digital Transformation - July 29 2020

On this episode of the “AI Wisdom – Talking Innovation in Insurance” podcast, host Ron Glozman speaks with Mike Connor, CEO & Co-Founder, Silicon Valley Insurance Accelerator, about the impact, the results, and the long-term effect of digital ecosystems on insurance. Click the play button to listen or read the full transcript below.

Full Transcript

Ron: Hello, and welcome to “AI Wisdom Talking Innovation in Insurance”. On this podcast, we talk to business and insurtech leaders about how artificial intelligence is transforming the way we buy and sell insurance. I'm your host, Ron Glozman, founder and CEO of Chisel AI, and a strong believer in the power of AI to help people work smart and enrich their lives. So, let's get into it.

Even though insurance has traditionally been classified as a low engagement transaction, customer expectations are changing and quickly. Consumers who purchase from Amazon and other popular e-commerce sites are expecting the same type of high-touch, fast response, and self-service from their insurance provider. So how can digital ecosystems comprised of InsureTechs, insurance companies, suppliers, vendors come together to deliver insurance services where and when needed while being adaptive and scaling across different areas of business geographies and empowering collaboration?

I’m very happy to have with me today Mike Connor, CEO and co-founder of Silicon Valley Insurance Accelerator join me as we discuss the impact of digital ecosystems on insurance. Welcome, Mike. Before we jump into our discussion, can you please introduce yourself?

Mike: I can. Ron, thank you very much for having me on. Pleasure to be here with you. Silicon Valley Insurance Accelerator has been around for about five years now. We started one of the first InsureTech conferences. We’ve done a number of them out in Silicon Valley. We’ve really focused on the leading edge of innovation in the community.

My background is that I started early on in this industry, one of the first computer stores out there in the United States. From there I moved to Apple. I was one of the first employees at Apple. And yes, I worked for Steve Jobs and learned a lot as a product manager, and since then have been part of a number of Silicon Valley startups. Most recently, had worked with Adobe in their advanced technology group and got into insurance because I just saw through actual work that I’d done for a company called SpatialKey, a data visualization analysis for geospatial data company, just how far behind the insurance industry was in technology and how much technology could do for it. That’s really kind of what led me into Silicon Valley Insurance Accelerator.

Ron: I love that, and I hope you got some options early on and got to hold onto them because I’m sure they’re worth a pretty penny today.

Mike: I did. Thank you.

Ron: Mike as a leader who is recognized as a driving force and one of the top influencers in InsureTech, you know, there are a lot of challenges facing the industry today. I’d love to hear what some of the ones are that you see as top of mind.

Mike: I think we’ve all heard this quote before: “Culture trumps strategy every day, you eat it for breakfast.” So to me, I think as you know, as deeply in love with technology as I am and what Silicon Valley can create for the world, my belief is the biggest challenge for the insurance industry is changing culture.

You can throw all the technology you want at something, but until you really change the culture and move it to a stance that is really adaptive and agile and customer-centric and really willing to take on the risk that it takes to be innovative, all they’re going...and we see this all the time. They mostly spend time polishing things they’ve already got as opposed to really driving innovation. So, I think culture is a critical part.

I think today in the face of COVID and other stuff we really need cultures that can adapt quickly, that can respond to things like COVID, like climate change, the cyber environment that we’re in, that can respond to the work that is being done by InsureTechs as well as some of the big tech competitors that are looking at this market. Then really find a way to reward as opposed to stifle the workers inside the organization who are really trying to move them forward from an innovation standpoint. So I think that is the biggest challenge that we face and certainly, technology has its place as well but I think invariably to me, I always turned to culture and said, if we can solve that problem, we can solve the rest.

Ron: I love that. We at Chisel talk a lot about culture internally, but I’d also love to hear when we were talking a little bit beforehand in the green room, you mentioned that you’ve noticed a trend recently that companies are starting to recognize that they need to double down or if they haven’t been investing, start investing in automation. You used the word “smart automation” because some things probably shouldn’t be automated versus some things obviously should be. Can you walk us through some of what you’re seeing there?

Mike: Sure. As we talked, we’re doing a series of webinars around...they’re basically titled the “Innovation Trailblazers” webinars series and we’re doing a number of those. One of the ones we’ve been doing recently is around COVID and we’ve been talking to a number of carriers, a number of established technology vendors, as well as InsureTechs like yourself. And the net of what we’re hearing is that... I would say that the ones who get it are really realizing that we’re heading towards a very different world. As a result, what they’re doing is they’re re-reviewing their priorities, and particularly their digital transformation innovation priorities. What they’re trying to do is align those with what they believe they have to do right now to respond to customer needs, but more importantly, align their companies to what’s coming next.

I think what we’re going to see is the digital leaders in this marketplace... well, we are seeing the digital leaders in this marketplace really double down on those things. We’ll start with customer-facing processes. How do we engage customers digitally? How do we build more effective relationships with them? How do we meet them where they live in the digital ecosystems that you were talking about earlier that surround the insured? Whether it’s a lifestyle support or a business value chain support, how do we meet them and bring value to them where they live? And then how do we optimize the core processes in the way we support our internal workers and our partners, including agents and brokers who help, you know, move the product into the marketplace. So, I think across the board, everyone is looking at those hard and re-evaluating those priorities and starting to double down on those.

I think that my recommendation for any company out there is if you think we were moving quickly to a digital stance before, we’re going to move even faster now because we have to.

Our customers are facing the same thing we are, which is they have had to suddenly remote workers. They’re going to have to change their models and approaches and they’re going to expect the same of the people that they rely on to support their business through these very tough times of change.

Ron: That’s right. I think that you hit the nail on the head right there on that last piece, which is,  support them through this time of change because our customers...and when I say our customers, I think that flows throughout the value chain, the policyholder, the broker servicing them, the underwriter working with that broker, the carrier who underwrites that risk, the reinsurer who then takes on some part of that risk potentially. And so, we are all at the end of the day trying to help each other throughout this process.

Now, I do want to circle back as technology is obviously, I think for you near and dear, and for me definitely near and dear to my heart but culture as well. And so, one of the things that I’ve heard a little bit of talk about product-centric to service-centric, like operation-centric to customer-centric. When you think about that cultural shift, how do you view it, what dimensions are you viewing as the ones that need to be shifting?

Mike: I think all of those dimensions. If you think about the insurance industry that most of us are familiar with, it’s really focused on how do we acquire more premium and how do we pay claim checks out when something bad happens without having to pay too much? That’s kind of the business model. And we focus on all the operational elements that it takes to do that, and we focus on our internal KPIs as opposed to those of the customers. So, when I think about the cultural shift to technology...and I’ll use a quick story. This is back when I was at SpatialKey and we did end up serving the insurance market primarily, but we started off in law enforcement and really helping them look at where crime was and so on, you know, using data to do that as well as operational information.

I was working at the time as a product manager and business development manager and we had an amazing rockstar development team but they were into all the cool things they could do with the technology to visualize geo data particularly over time and those kinds of things. And so, I’d conveyed to them some of the requirements that were needed to address the marketplace and they just couldn’t get it. So, we had a police chief that was out in Utah who was really a very forward-thinking guy. And he said, why don’t you bring everybody out to live and work with us for a week? And so, we did. We basically embedded within his organization, he introduced us to others, and so on.

And all of a sudden lights started going up, you know, across the board for people like, you know, our developers were working on really high-resolution screens when they were designing and developing things and, of course, they made the user interface to support what they had on their screen. Well, what you can do when you’re sitting at your desk in a stable environment with a big screen is very different than what you can do in a squad car going 70 miles an hour through red lights. So, all of a sudden, the awareness level went up dramatically.

And to me, that is what the insurance industry needs to do is move away from the product centricity and say, what’s going on with our customers? Where are they having challenges that we can address in ways... you know, you’ve heard me talk about this before, but how do we move from that product-centric view of a premium check and claim check to looking at how do we bring value-added services from these ecosystems surrounding insurance into play to help make risk more transparent, to help predict that risk for the customer more effectively, to help prevent that risk from occurring, mitigating that risk from occurring when it does, and then helping people recover from the risk?

I think when we look at what are the outcomes people are trying to achieve both from a business standpoint, from a personal standpoint, and then look at how do we embed insurance in a broader solution that does that, I think that’s the winning ticket. When you’re standing there looking at the world through that customer lens, all of a sudden, the lights start to go on and you can start to see the things that are actually going to create value out there in real-time for people.

And I think to me when I talk about moving our product-centric to service-centric, operation centric to customer-centric, and company-centric to ecosystem-centric, those are the things that I think we need to do. It’s that kind of experiential understanding of the customer that it takes to be able to drive innovation.

Ron: It sounds like you lived my real-life dream of being on "Live PD," except not the person who’s like, you know, being filmed, but more like in the squad car because that definitely seems like the more interesting part between the one being arrested and the one doing the arresting, but that’s really amazing. I’m curious to hear, you know, let’s say you don’t do it, what do you see as the risk of not doing a digital transformation and not changing to meet the demands?

Mike: Well, I think you’re dead in the water. I mean, bottom line is I think if we, as I said earlier, you know, the net is this is accelerating the need to go digital. Why?

Because our customers are accelerating their digital needs and requirements and they’re going to expect that of us as an industry. In addition, we know there’s tough economic times ahead. And like it or not, we’re going to see layoffs in this industry because of the economic downturn. So people are going to have to get more efficient at the processes that they run, and also what they will see is, you know, as we move through this COVID experience, what we know is there is a lot of customer expectations around what they thought they were insured for it and so on that are not going to be met.

There’s also, and we’ve already started to hear this, like people trying to get through to an insurance company when there’s no call center anymore and the insurance company or the broker or agent really wasn’t set out to work with them digitally. That’s going to leave a very bad taste in people’s mouths, and they are going to be looking for the companies that can really serve them on a digital footing.

I think the net is that if you are not making that transition now and if you’re not putting the pedal down on that now, I guarantee you competitors will, and your customers are going to pay attention to that. The net is that, you know, you will be left in the digital dust that they create.

Ron: Another one bites the dust.

Mike: Yep. The other thing I just want to talk a little bit about is I also see people grabbing...and not to pick on Blockchain because I think it certainly has some places of value in the world, but, you know, I think as an industry we thought innovation was either polishing our existing processes and/or chasing shiny objects like Blockchain without really standing in the customer’s shoes and saying, how does this create value for that customer? So, I think when I think about...this goes back to the comment earlier about how do we intelligently do this? I think it starts by saying, what’s the world to come and what are our customers going to need, and then how do we optimize the work that we’re doing in digital transformation and innovation to meet those needs?  I think when I talk about intelligently focusing on those things, it’s that kind of approach.

I think additionally, you know, particularly with the kind of tools that you’re building and so on, there’s also an opportunity to bring really next-generation data and next-generation AI and machine learning into play where it’s appropriate. It’s not always appropriate, but I think that also, as we know, it can reduce costs, it can reduce errors, it can reduce the time that it takes to do things.

And it can give us insight that we would never have had before had we not had models that could bring that to life for us. So, I think all of those things are really critical as we look at this pivot of digital transformation that the industry now has to take on.

Ron: I couldn’t be more with you and I think you’ll have a very interesting perspective on this. It’s a question that we ask often, but I think you’ll actually have a very different perspective on this so I’m curious to hear. Not everyone is able to move as fast and some people especially are stuck in analysis paralysis. Have you seen that? Have you seen more or less of that? And then also, what are your recommendations for them?

Mike: Yes, I have. I’m laughing because in one of the presentations that I do, I have a picture of a bunch of executives sitting around the table trying to pick out what color paper clip they want to use. So yeah, we do that. I’m going to go back to my days at Apple. You know, one of the things that we were told is, it’s more important to make a decision than to stay stuck by not making it. And what Steve would tell us is I don’t care if you fail, what I do care is that you fail intelligently. So, when you decide to do something, you know the risks you’re taking and you’ve done the work that it takes to mitigate that but if you’re not taking risks, you’re not going to be working for me very much longer.

I think that’s even truer today. It’s like, obviously, we’re a regulated industry. Obviously, we have some challenges. Obviously, we have both stakeholder and shareholder and government requirements to do the right thing and act intelligently. But I think the net is, you know, we have been slow to innovate, and we’ve been slow to step outside of our existing business models. I think the net is you have to take those risks.

And so, I believe if you’re not doing that, you will find know a number of things will start to happen. At a corporate level, you will start to see people who do get it, who do want to move forward leave and go to companies who will give them that freedom. I think what you’re also going to see very quickly here is boards of directors really kind of stand up and say, we need executives and we need middle management that can move us forward.

I think what you’re going to see digitally, and I do believe what you’re going to see is those people who stay stuck are not going to have those jobs very long, particularly given that we’re already looking at an industry that is going to have to do some layoffs.

My recommendation is if you aren’t moving now, you need to be, and if your company isn’t letting you move, you need to find one that will.

Ron: You need to move. I love that. OMG. I have to take you to dinner when this is all over, I need to hear more of those quotes. That’s very powerful. One quote that I heard recently that I would liken to that, the concept is like a parent speaking to a child and they’re like, "Go read your book," or, "Go do your homework." And they’re like, "Why do I have to?" And the response is, "You don’t have to do anything, but you have to accept the consequences. You don’t get to choose the consequences; you get to choose your actions." And based on the actions or lack of actions, the consequences are decided. And so, as you point out, like, if you do nothing, then you accept the consequences. You don’t have to do it; you just have to live with the consequences.

Mike: Yeah. I would say the consequences, particularly given the economic climate we’re going into, aren’t going to be fun.

Ron: That’s a good way to put it. So, we’re going to take a quick 20-second break to tell you where you can find more information and insights about insurance innovation. We’ll be right back.

[If you liked this episode of AI Wisdom, subscribe to our blog, Writing the Future: AI in Commercial Insurance at for feature articles, interviews, opinions, and more.]

We’re back with our featured guest, Mike Connor. Let’s jump right into the next question. As technology disruption continues to be a theme for the industry in 2020, and as we’ve discussed probably an even more important theme than maybe some would have thought, what are your recommendations for those who are struggling with embracing innovation, change, and technology adoption?

Mike: I think the net is if you’re in a company whose culture really isn’t there yet, and particularly...and this is a message to senior executives because cultural change is hard. We all know that change management is hard. What you have to do is start building or, you know, places in your organization where true innovation that actually gets back into the business can occur. I really want to say that you see a lot of people stand up innovation outposts here in Silicon Valley. We see executives come out and visit Silicon Valley and go meet Google and go meet Facebook and go meet LinkedIn or Uber. Then they put some money and budget and a few people in place and an innovation team, but it’s not linked back to the fundamental, where is the business going and how do we help it get there?

And so, I think I would say for executives you need to find real business problems and real business value that you can create for a customer through innovation. You need to set aside a team that can go do that work. You need to support the hell out of them even when they piss off the people that are driving money into the business today because they’re challenging their existing business model but you need to do that in small doses.

And then you need to promote those people as heroes because that’s what starts to build culture. When a company looks at and says, oh, this is what the executives are rewarding, all of a sudden that message starts to become clear. So, they’re the ones that are getting the perks. They’re the ones that are getting the bonuses. They’re the ones that are getting to set up and drive new product lines and the company can see that. I think that’s the change that needs to happen.

And what that means is you need to change not only who you hire, how you hire, how you compensate, how you reward, and how you promote. Not only from a position standpoint, but from who you promote as the company heroes. We’ve traditionally kind of supported the person that drove the biggest amount of old legacy revenue and that’s not important because we got to keep the wheels on and keep the business moving. But we have to start making heroes out of people that are taking those risks that are moving the company forward, even when they fail. I think when the company can start to see that, all of a sudden, that’s what will start to move it. So, you can’t move an entire organization there all at once, but what you can do is start setting up those small teams and getting them promoted as who’s driving the future of the company.

The other thing I would say is look around the company, find the people that are chomping at the bit to move things forward. Bring those people into the senior executive meeting, bring those into the planning meetings. Those people who are challenging the status quo, trying to move the company digitally forward so that their voice can be heard and supported by the upper-level management. I think that’s how that process starts to take place.

Ron: I love that. I think that’s so powerful and so actionable for people to take action on. I’d love for you to dive deeper on the...because you mentioned it for a sentence, and I think it needs a little bit more justice. Talk to me about how you handle the failure because basically you said like you have to be okay with failure, but you know, let’s go a little bit deeper on that.

Mike:  I think the key is fail smartly, right? So again, know what the risks are. How do you handle failure? I think that... you know, and I look at this probably like a stage-gate for venture investment and a stage-gate for agile development. It’s like when we set out to do an agile roadmap and we layout agile themes, what we say is what is the value we want this team to create? And then we measure that value at the end of it. And we say, well, does it meet the mark? Did it accomplish? Is it going to deliver the value to the market, to the customer, to the company that we said it was going to deliver? If not, why not? What should we change?

And if the bottom line is in this first, second or third step we’ve taken along the path and bringing that into to life, we’ve discovered that it’s actually not going to achieve what we wanted to or there was a technical challenge that we hadn’t envisioned that’s going to keep us from doing it or the market wasn’t accepting of that initially as we thought it was going to be, all of those things are great failures because they’re learnings. They teach us.

I think the other thing is that a lot of companies will just invent within their own walls. And I think in today’s marketplace, it’s important to bring in partners who are on that visionary, creative innovation path. It’s really important to bring in customers who are challenging you. The customers who are telling you you’re not doing this right. We need something more from you.

So, when you’re working in that environment and when you’re doing kind of a stage-gate approach to things and you’re failing, those are good things. You say, what did we learn from that and how do we help build the strength of the team? What knowledge do we get out of it? And then let’s reward them for doing that.  I think those are the things that I would say when you’re failing that way, that’s the smart way to fail and you should reward that. When you’re basically saying, "Hey, we’re going to invest $20 million in something and come and check back with us like 3 years from now when you’re done and we’ve blown that entire $20 million, and we’ve got nothing to show for it," somebody needs to be fired.

I think in today’s world, you have to work intelligently, quickly, and informed and make those decisions as you go. And make sure that there’s strong lines of communication between the stakeholders so that you’re not getting surprised. Knowing what the risks are and anticipating those and saying, how do we mitigate those risks, that to me is failing smart and failing fast.

Ron: Know the risks, clear lines of communication, fail smart, fail fast. I think the one that you said early on was also... I believe it comes from Sansui. It goes, you learn more from a loss than you do from a win.

Mike: Amen.

Ron: So, as we start to wrap up and you talked a little bit about this, and I love your perspective because you’ve obviously seen so many different technologies. You touched a little bit about Blockchain, or many people think of Bitcoin, which is an implementation of Blockchain. What technologies are you most excited for in the next 10 to 15 years?

Mike: Several things. Obviously, the work that you guys are doing is high on my list. I think big data, more data in AI and machine learning that enables us to leverage that data and turn that into meaningful business and customer value. Those things are important to me. I think as I look out, you and I have talked about this, I think our message to insurance companies is you need to wake up to the digital ecosystem surrounding your customers. You need to understand what value those are creating for the customers and how those align with what you could do from an insurance perspective to augment that value or to have the value that those create are augmented by insurance.

So, to me, the work that’s being done in and around creating those digital ecosystems, creating the platforms that those run on, creating we’re seeing more and more of the API and microservices as a platform solutions come out. We’re seeing more and more, you know, shareable data that has intelligent metadata. We’re also seeing a whole lot of work being done around intelligent APIs and microservices that are smart in how they connect. We’re seeing some of that work be done. So those are the things that I think in addition to big data in AI are most exciting to me.

I think my encouragement there is for people to not just look at those technologies as ways to augment existing business processes or existing channels of distribution but to look at those as, can these be a springboard for really changing, because to me, true innovation is really changing a business model to create more value in the world and for your customers. In many cases, that’s going to rub up hard against your existing business models.

I would say, you know, those are exciting technologies to me, but their true value comes from how do we better serve the customer by walking through our existing approaches and saying, where’s the waste? Where are we spending too much money, where are we not spending enough money? Where is there friction between helping the customer achieve the business or personal outcome that they need and how we and others are trying are serving them and achieving that outcome?

So I think it’s really kind of, we have to start from an outcome-based standpoint and then go back into these technologies and say, how can we leverage these technologies to help achieve a better outcome, a better, faster, smarter, cheaper outcome for our customers?

I think any technologies that enable us to join together to create more comprehensive, integrated solutions and make it easier for the customer to do that that help reduce, you know as we talked about earlier, help predict, prevent, mitigate, and recover from risk better, faster, smarter, those are the technologies that I’m most excited about.

Now, the other one I’m going to touch on is the work that’s being done around cybersecurity. As we move more and more toward this digital world that we’re now heading towards even more rapidly, a lot of the work that’s being done around cybersecurity, around assessing cyber risk. Not as some of this snake oil that I’ve seen which says I can assess your cyber risk as a business in five minutes with my little software package like that’s snake oil. But the ones that are actually doing the work to provide value-added services around that as part of an insurance offering, those are the things that I get excited about.

Ron: So, to wrap up, I’d love to ask you a question. I would say my favorite answers to this question are typically not business-related, but you can take it anywhere you want, which is if there’s one piece of advice that you’d like to share with our listeners.

Mike: I think my biggest piece of advice is, be in motion. Be in innovation motion. Start small, move fast. And the net is if your company can’t or won’t, move quickly to one that will because the world needs people who are standing out there on the edge of that future and saying:

“I have a vision that’s going to make us a better world, I have a vision that can make this a better industry, I have a vision that can create more value for our customers.”

Now more than ever, we need those people and if you’re one of those people, don’t stand still. Either get your company to move or find one that will. That’s my advice.

Ron: I love it, Mike. Thank you so much for taking the time to share your expertise with us and our listeners. Where can people find out more about you or SVIA?

Mike: They can find us at We’ve got a number of things going on that will be of interest to your listeners. One is our "Innovation Trailblazers" webinars series. We’re doing a bunch of mini-series on different business lines on COVID, on next-generation core systems. I’d love to have you participate in those. And we’re in the process of launching, we’re just in beta right now, a community platform for innovators and a marketplace for innovators called New Tech Match. And so, think LinkedIn kind of really focused on how do we enable innovation and innovators to come together and find each other? You can do a search for New Tech Match. You’ll find that out there as well as SVI Accelerator, and that’s where you can find us.

Ron: Awesome. Thank you so much. As always, if you want to find out more about Chisel AI, you can check us out at or on LinkedIn or on Facebook. You can also follow me on Twitter at Ron Glozman or Chisel AI. Thank you so much, Mike.

Mike: Ron, thank you. A pleasure to be here.

Ron: That’s a wrap for this episode of “AI Wisdom” hosted by Chisel AI and me, Ron Glozman. Thanks for listening.

If you like our podcast and want to hear more, check us out at or tune in and subscribe wherever you get your podcasts: SoundCloud, Spotify, iTunes, Google Podcast, or Stitcher

Join us next time for more expert insights and straight talk on how AI and insurtech innovations are transforming the insurance value chain. See you on the next episode!

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