A good insurance product is only part of the proposition

By Rafael Gomes, Chief Proposition & Strategy Officer | 24 August 2026 | 10-minute read

After more than 15 years in insurance, much of that time in underwriting and affinity insurance, I have seen how much work goes into getting an insurance product right. The cover has to make sense, the risk has to be understood, and the price and terms have to be sustainable. None of that becomes less important simply because insurance is being sold through a digital channel.

During my years on the insurer side, I naturally began with those questions. Can we cover the risk? Do we have enough information to price it properly? Are the terms right? Does the expected claims experience make sense?

Since moving from an insurer to an insurtech, I have had to look at the same opportunities differently. At discovermarket, we work between insurers and companies that want to offer insurance to their customers. This brings us close to the commercial, technical and operational decisions surrounding the product, many of which are easy to overlook when the focus is mainly on underwriting.

A good product can still struggle if the distributor does not see enough value in offering it, the customer journey is too complicated, implementation requires more effort than expected, or nobody is quite clear about who will manage what after launch.

Working on this side of the industry has not made me think underwriting matters less. It has made me pay much more attention to everything that has to work around it.

The distributor is usually thinking about something else

For an airline, retailer, telecommunications provider or financial services company, insurance is not the main business. It is one of many ideas competing for budget, development time and attention.

For a distributor, adding insurance to an existing customer journey rarely involves only one change. The company may need to alter its checkout, allocate developers, train its customer service team, manage cancellations and refunds, answer questions from customers and deal with additional reporting and reconciliation.

The distributor therefore needs a good reason to proceed. Commission matters, but it is not the only consideration. The offer also needs to fit the underlying business and add enough value to justify the work involved.

This is where insurers and distributors can look at the same opportunity and see different considerations. The insurer may be discussing coverage, pricing and underwriting requirements, while the distributor wants to know whether an extra step will affect conversion, how much development work will be required and who will respond when a customer has a problem.

Both perspectives are reasonable because the two parties are responsible for different things. The practical challenge is bringing those priorities together early, before decisions about the product, customer journey and operating model have been fixed.

A large part of our work at discovermarket is bringing these requirements together. There is little value in approving an insurance product that the distributor cannot realistically sell or operate.

Before the integration starts

Technology is essential to embedded insurance, but it does not answer the basic questions about what is being sold, how it should appear to the customer or who will run the program. Those decisions need to be made before the integration is designed.

Before discussing an integration, the parties need to agree on what is being offered, who is insured, when the cover begins and ends, how the product will be presented, and what information needs to be collected. They also need to decide who handles cancellations, where customers go when they have a claim, and how premiums and commissions will be reconciled.

These may sound like operational details, but each one eventually becomes a business rule, a technical requirement or a customer service process.

I have seen projects spend considerable time discussing an integration while important parts of the proposition are still changing. The specifications then have to be revised repeatedly because the technology is being asked to accommodate decisions that should have been settled earlier.

discovermarket’s platform supports quotation, policy issuance, servicing, claims and reporting. Before we configure any of those processes, however, we need to understand how the insurance is supposed to work within the distributor’s business. Otherwise, we risk making an unclear process faster without making it any better.

Launching is only the first test

Go-live can feel like the end of a long project. By that point, commercial, underwriting, legal, compliance, operations and technology teams may have spent months preparing the program. Issuing the first policy is an achievement, but it only proves that the journey can work.

It does not tell you whether customers will buy the product at the expected rate, whether they understand what they are purchasing, whether the price works in that setting or whether the distributor will generate the volume assumed in the business case.

Once customers begin seeing the offer, the parties can understand how it performs in that distribution setting. Even when the insurance product is well established, it may need to be presented or supported differently when introduced into a new customer journey. The wording, placement of the offer or servicing process may need adjustment without there being anything fundamentally wrong with the product.

The early results help the parties distinguish between the product itself and the way it is being presented and operated. The coverage may be sound, but the explanation may not be clear enough. The offer may appear at a point in the journey that does not suit the customer, or a servicing process may need to be adjusted for the distributor’s channel.

This is why useful reporting needs to go beyond a monthly bordereau. Written premium matters, but it does not tell the parties where customers are leaving the journey, why policies are being cancelled or whether a recurring operational problem is developing.

For us, launching the program begins another phase of the work. Connecting an insurer and a distributor and issuing the first few policies is not enough. The program has to continue working once customers start using it.

Sometimes we spend too much time perfecting the insurance product

My underwriting background probably influences me most when I think about the product itself. Insurance people are trained to care about coverage, pricing, terms and controls, and rightly so. Those fundamentals remain important, whatever the distribution model.

The difficulty is that a product can become better on paper and harder to sell in practice.

Additional coverage may require more questions, making the distributor’s purchase journey longer or less natural. A higher premium may be justified by the broader protection but exceed what customers are prepared to pay in that context. Underwriting controls may be reasonable for a traditional sale but impossible to apply when thousands of relatively low-premium policies are being issued automatically.

This is not an argument for removing underwriting discipline. It is an argument for designing the product around the way it will be distributed.

Projects do not always begin that way. Sometimes an existing insurance product is presented to a distributor, and the distribution process is then expected to accommodate it. We generally prefer to begin with the distributor, the customer and the transaction. Once we understand what is happening at the point of sale and what risk would be useful to cover, we can work with the insurer on a product that fits.

That does not mean every product should be built from scratch. Often it should not be, because customization brings its own cost and complexity. The important point is that the insurance product and the way it is sold cannot be designed separately.

The operating model matters more than people expect

A digital insurance sale may take only a few seconds, but a great deal happens behind it. There are rules governing eligibility, pricing, documentation, premium collection, cancellations, claims, reporting and reconciliation. Responsibility for those activities may be divided differently depending on the insurer, distributor and market.

When ownership is unclear, the problems usually appear after launch.

The distributor may think the insurer is responding to a customer while the insurer assumes the distributor is doing it. A cancellation may be recorded in the distributor’s system but not reflected correctly in the policy records. Premium may have been collected even though the reconciliation does not match the policies issued. A customer may need to make a claim without knowing who to contact.

These problems are not particularly exciting, and they are unlikely to appear in a product demonstration. They are nevertheless what separate a program that can grow from one that becomes progressively harder to manage.

This is an important part of discovermarket’s role. We give distributors a way to offer insurance without building the entire insurance operation themselves, while giving insurers the information and controls they need to support the business.

A significant amount of our work therefore concerns processes that the customer will never see. They matter because someone has to manage them every day once the program is running.

Looking at the whole proposition

After working on both sides, I still believe that a strong insurance product is essential. I simply ask more questions now.

Does the distributor have a clear reason to offer it? Will the customer understand what is being sold? Can the program be implemented without creating unreasonable demands on either party? Are the responsibilities clear, and will the reporting show what is happening after launch?

A proposition needs to work commercially for the distributor, make sense to the customer and be realistic to operate. Technology can support those requirements and make the program manageable at volume, but it cannot compensate for a proposition that was not properly thought through.

This is how we approach opportunities at discovermarket. We begin by understanding the distributor’s business and what insurance could realistically add to it. We then work through the product, insurer, commercial model, customer journey and operating requirements before using the platform to bring those parts together.

For any company considering embedded insurance, I would spend time on these questions before beginning an API discussion or asking an insurer for a product. Understand what the program needs to achieve, why customers would buy it and what will have to happen every day once they do.

Many of the most difficult problems are much easier to solve before the first policy is issued.

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