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Martha Notaras: The “Outsider” with an Amazing Inside View

Bill Sinn | April 04, 2019

Editor's Note: Martha Notaras is a partner with venture capital fund, XL Innovate. She is one of three keynote speakers at ITA LIVE 2019. Her presentation, titled "Insurtech: Past, Present and Future,” is scheduled for 5:15 p.m. on Sunday, May 5, 2019. This is an excerpt from an article that appears in the March/April edition of ITA PRO magazine, which comes out the week of April 8th.

From an insurance perspective, Martha Notaras considers herself the ultimate “outsider.” Her background is not in personal lines insurance, commercial lines insurance, any insurance at all. 

It’s her investment acumen and expertise – acquired over 25 years of investing in tech-driven companies -- that gives her insight on what is truly happening in the business world. And it offers a unique viewpoint on the whole insurtech revolution.

Her early career included investment banking at Merrill Lynch and commercial banking at Credit Suisse. Her “insurance” career started at the Daily Mail and General Trust PLC, where she was involved with business data and analytics. She invested in 20 companies during her time there; two of those investments achieved valuations over $1 billion. The portfolio was so small that “it looked like a rounding error on the income statement.” That small portfolio grew to represent 20 percent of the top line at the Daily Mail and even more of the bottom line. 

She also led the acquisition of insurtech pioneer Risk Management Solutions (RMS), and served on the company’s board for 10 years. That’s where she met Tom Hutton, who happened to be on the other side of the negotiating table. It was the same Tom Hutton who became managing partner of XL Innovate and convinced her to join that fund in 2015.

The Lure of Insurtech
Depending on what you read today, the number of insurtech companies seems to fluctuate between 1,200 and 1,500 – “a very big number, which have started up in the market in a very short time period,” according to Notaras. 

“Over the last few years, I’ve had the opportunity to work with a number of companies at different stages of development. The good news today is that insurtech is going global,” she says. “The even better news is that total funding continues to go up, with U.S. insurtechs garnering the largest investments.”

Notaras says that there are big changes happening in the insurance sector. “And it’s not just the era of the insurtechs,” she says. “There has also been a change in the thinking – and the energy – of insurance carriers. Insurance has always been fighting against its legacy systems. But the promise of insurtech is the ability to give insurers the insights and agility they have long wanted but had given up on achieving years ago.” 

She cited DataCubes – a data science company – as an example. “Here’s a company that takes an insurer’s unstructured data and then structures it so it is usable, easily consumable data, and combines it with third-party data. Unstructured data has always been difficult to extract information from. Commercial underwriters now have a technology and objective third-party data that can provide new insights into the risks of their business.

“Another area of change is around machine learning,” she adds. “Bots are becoming highly acceptable – and more of the norm – in personal lines. Machine learning provides greater accuracy to understand the meaning of data, which was not possible with the manual analytics used before.”

Learn more from Martha when she keynotes at ITA LIVE 2019 next month in Ft. Lauderdale. Register here: ITA LIVE 2019

 

 

 


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