News & Insights
In Conversation with Scott Walchek, CEO of TrovBy Tricia Kemp, General Partner, Oak HC/FT
What is Trov?
Trov is a technology company providing on-demand insurance for single items. We enable people to insure the things they want, when they want, for the duration they want – entirely from an app on a smartphone.
Trov is the largest emerging insurance company that takes no balance-sheet risk – much like Uber is the largest taxi company but owns no cars, and Airbnb is the largest hospitality company but owns no property. We are a full-stack reinvention of the insurance value chain.
What was the genesis of Trov?
We created Trov by applying technology to the intersection of people and their possessions.
Along the “arc of possession”, Trov exists between the poles of acquisition and dispossession, where there’s a whole lifecycle of utility that nobody has applied technology. We believe that is where Trov’s opportunity exists.
For decades, enormous investment and technology has been poured into the acquisition and dispossession of goods, with companies like Amazon, eBay, Alibaba, Craigslist, etc. But Trōv is designed to help people benefit from the information about the things in their lives – after acquisition and before dispossession. We imagine a time when everyone will have a Trōv – populated with the information about the things they own – and will uniquely benefit from that information. Our first unique benefit is on-demand insurance for single items.
How is Trov changing the way consumers think about property insurance?
A great analogy is iTunes. When Apple launched the service, they changed the way people acquired and consumed music by disassembling the album into separate parts, allowing people to buy individual songs. Not only did they invent the technology to do that, but they also created an entirely new marketplace – all while serving an emerging generation of consumer seeking greater control through technology.
Trov is attempting to do the same thing by disassembling the insurance policy covering all their contents and enabling individuals instead to cover a single or select few assets. If you only care about your camera, laptop, or bicycle, you can use Trov to protect just those items, rather than buying a blanket policy that encompasses all your possessions. It’s like buying that single song instead of the complete album.
Traditional insurance policies are typically rigid and the policy is always active, which extends the time and increases the cost of coverage. Trov’s insurance platform offers a solution for those who want to choose when to protect single items and keep costs low.
What is the most common item people are insuring through Trov?
Because we’re focused on millennials, we’ve figured that the things our consumers care most about are the possessions that connect them to their world. That starts with consumer electronics: smartphones, laptops, tablets, headphones, and gaming consoles. Photography gear is also an important category.
Soon, we’ll support other categories in response to user demand. For example, jewelry and unique watches.
The average consumer covers two items, usually their smartphone and laptop. Smartphones are the number one item because they are automatically added to Trov and serve as a digital repository for all the information about your possessions – including metadata around the purchase, retailer, retail replacement value, etc. One of our current development tasks is focused around removing the category limits so that users can cover more types of items.
Trov first launched in Australia and the UK, and is now expanding rapidly across Asia and Europe. How are you able to enter so many different markets?
Our objective has always been to find strong local partners to help us navigate the market-entry process and overcome geographic or cultural hurdles.
We initially partnered with primary insurers to launch in Australia, the UK, and Japan – via Suncorp, AXA, and Sompo, respectively. The model of launching individual partnerships in each market – and with primary insurers that have their own consumer-facing brands to protect and promote – brings with it massive hurdles that are more protective than expansive. So, we more recently formed a partnership with MunichRe to enable growth globally across Europe and Asia.
Because MunichRe is a global reinsurer without a direct-to-consumer brand, we can drive our expansion more efficiently by leveraging their footprint, balance-sheet strength, and regulatory relationships. This can all occur more quickly than growing one market or one partnership at a time.
One of our core advantages is the ability to enter a market relatively quickly and inexpensively. Since we’ve built the complete stack of technology required to support all aspects of the insurance value-chain, and our tech is entirely cloud-hosted (AWS specifically), we have a time-to-market advantage that, compared to incumbents, is more cost effective.
What are your future ambitions for Trov? What features are you launching?
We are pursuing two additional, complementary lines of business. The first is a private-label (B2B2C) product line that is leveraging our platform to support on-demand, micro-duration, unbundled opportunities for auto, home, and small business insurance. This will be a white-labeled or co-labeled offering for existing insurers and financial institutions to brand applications that we build for them.
The second opportunity we are pursuing is what might be called insurance-as-a-service, through which our unique proposition and technology can be embedded in other companies’ apps or operating systems to benefit their service offering or user experience. We’re excited about both these opportunities.
Compared with banking, insurance has been relatively slow to innovate and digitize. Why is that so?
There are many reasons why insurance is slow to embrace transformative technologies. But specifically comparing banking and insurance, I think the frequency with which we engage with insurers plays a role.
Banking is a daily engagement, and banking products – from loans to checking to savings – involve daily or frequent transactions. Companies and consumers are reminded regularly of the benefits and potential for technology within those banking interactions. There are also several early innovators who jumpstarted banking technology, like PayPal.
Conversely, consumer touchpoints for insurance are opaque and infrequent – more typically on a yearly basis. But now that the world is going the direction of the smartphone, and consumers are living their lives and consuming services digitally, it’s logical to apply the same banking engagement model – unbundled, digital, and on-demand – to insurance.
If I weren’t a CEO I would be…
Traveling and in the water more frequently….
What’s on your desk right now?
I don’t have a desk.
What is your favorite source for news?
What’s a great piece of professional advice you’ve received?
The most important job for a CEO is to create an environment where employees can feel safe and thrive professionally.
What one piece of advice would you offer to an entrepreneur?
Be comfortable with change. Where you think you’re going directionally is unlikely to be where you ultimately end up. So, embrace optimism and resilience. The optimism enables you to believe in what you’re doing every day; the resilience is there when the optimism gives out.