INNOVATORS VS COVID 19
Mexican Insurtech Guros is the Next Big Evolution in Latin American Insurance Industry
We talked to Juanma Gironella on how Guros transforms automotive insurance, and this is what he had to say.
First of all, how are you and your family doing in these COVID-19 times?
Juanma Gironella: My family and I are well and safe, thankfully. Since the beginning of the restrictions put in place in Mexico, we have been social distancing back in March. We are blessed to have close friends and family healthy as well.
Tell us about you, your career, how you founded Guros?
Juanma Gironella: My background is in Financial Services Consulting, but insurance has been a part of my family since I was little. My father held leadership positions in the sector. We launched the company in Mexico, where 70% of drivers don’t have car insurance, despite being required by law. We will expand across other insurance products in the near-term and other Latam markets over the mid-term. We want to change how insurance works in Mexico and Latin America. And individual car insurance usually means a complicated series of steps to get through before you are insured. We figured out that a company did something about it, with the user being the main focus. We started with seven employees and worked our way around the Mexican insurance business. We are proud to say that we are now at 40 employees and counting, seven years later, working with 8 of the main and most important insurance companies in Mexico. But we are just getting started.
How does Guros innovate?
Juanma Gironella: Most insurance platforms and traditional agents focus on selling and renewing policies. They care so little about what happens in between that it ends up looking like insurance ends right after the user pays for the product.
However, insurance is a low-frequency commodity, so the challenge is to keep the user engaged after the purchase. No one is trying to provide value to users and customers before and after they get the insurance. We developed several tools to get value from our platform throughout the entire experience, especially before you have an accident (or not needing to have one).
We are creating the figure of a “user” in insurance (someone who gets value from our platform before purchasing), which has helped us reach a YoY renewal ratio of +82%, which significantly increases our LTV (and creates a huge difference vs. most players in the market).
The key to winning the market is to become the go-to place for all major insurance products. To provide an unbiased and personalized advisory that recommends what coverage to get, you can manage every insurance product you have in a wholly digital model. We are aiming to solve this problem. We asked ourselves, ‘if nobody likes being called by salespeople, why is it still like this in the insurance industry?’ In other words, with the current model, it would appear the road ends once you’ve bought car insurance… but that’s where it begins!
Guros makes purchasing insurance as easy as booking a flight or a hotel online. Three clicks and you’re seeing the best possible quotes without getting a single phone call. You can purchase your policy online in less than two minutes. After purchasing, you’ll be able to make any change you want to your policy online, with a couple of clicks. We’ll also provide all the relevant information about your car (speeding tickets, inspection dates, alerts for paying your car taxes, on which days your car be on the road, what’s the value of your car). This allows us to get a much higher monthly retention than any other insurance platform in Mexico (as most focus on transactions only) and achieve a much higher YoY renewal rate, which concludes in an LTV 2 to 3 times the market average. We have developed several free tools that allow customers to get value from our platform before purchasing (you only need to provide email, zip code, and license plates to create an account). Our customers can use it without purchasing with us (although this allows us to quote their vehicle insurance without them having to do anything).
How the coronavirus pandemic affects your business, and how are you coping?
Juanma Gironella: This health crisis has not taken too much of a toll on our business, as we provide an online, fully digital service to customers who need a contact-free, safe purchase. Even though mobility restrictions lowered our usual website traffic rates, we have managed not only to make it through the year but instead thrived.
Our growth is proven with our numbers. We invested all of our time and efforts in raising more capital and investment from foreign ventures. Last April, which was the beginning of the pandemic, we closed a seed round for US$1.2 million through Magma Partners, LEAP Global Partners, among other investors. As far as our entire team, we’re working remotely since the pandemic started. Before March, we were seven people in the office working daily, and now, we hired +40 people remotely (and most of them we haven’t met in person), and we immediately adjusted to working remotely.
Did you have to make difficult choices, and what are the lessons learned?
Juanma Gironella: Because our business model is that of a young insurtech, our working culture has adjusted to all changes well enough. If there were one difficult issue I had to highlight, I’d say it was recruitment. The hiring process has been slightly different as we have not met in person with most of the people we’ve worked with throughout the year, both in-house and business partners. But we have put our hearts into new relationships. We try to maintain a fair amount of quality time and invest in transparent communication with everyone.
The lessons we’ve learned from this tough year are:
- The online market in Mexico is growing and will continue, with more goods and services sold online and people willing to buy them online.
- The customer is everything. We know that more information and good service, and a suitable platform will make a difference.
- Our talent and team can make a difference. We’re focusing on helping all of our employees, having a good work environment, based on results rather than time spent on the computer. Their motivation can result in good work, which can translate into profit and sales.
- There is no such thing as a “bad year” (or a “good year”). We closed a round of investment in the middle of the pandemic, so anything is possible.
How do you deal with stress and anxiety? How do you project yourself and Guros in the future?
Juanma Gironella: We hold weekly meetings with the whole Guros team and with our Heads. We have regular calls following up on our different projects with everyone involved. So having good, straightforward conversations helps mitigate any anxiety I may have regarding any particular problem.
I firmly believe our company has the potential and the capacity to become one of the, if not the most, thriving insurance marketplace in Mexico. Our online platform is simply working for our end users. We help them have a happier, stress-free, digital experience with something that used to be complicated. We are confident we will make a big difference in the industry in a few more years.
Who are your competitors? And how do you plan to stay in the game?
Juanma Gironella: Our competitors may have similar features here and there, but there isn’t a single direct competitor for Guros in Mexico. Today, other competitors may provide online quoting solutions, but they do not offer added value for other car-owners’ needs across the whole policy life-cycle.
We are here for the long run. We plan to stay in the game by committing to our user’s needs and real-life concerns. He/she is our primary purpose for new improvements. Through outstanding service and friendly technology optimization, we want to deliver a fantastic experience for them consistently. That is the promise of Guros to our users.
Your final thoughts?
Juanma Gironella: Insurance in general and vehicle insurance is an extremely fragmented market (in Mexico and other major Latam markets). Most policies are still sold by traditional agents, over the phone or physically. No one enjoys being sold insurance over the phone, so why is the market still working like this? Customers have to endure an awful experience when quoting and purchasing insurance and, after they purchase, they never get any value from their insurance provider. Most of them are plain and forgotten by their agents until the renewal is close. We’re here to change that. The market is ripe for disruption, as there is virtually no technology focusing on improving that customer experience.
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