As the company continues to disrupt the market, Song reveals his vision for the future of insurtech.

Peak3, formerly known as ZA Tech, is on a mission to make insurance more accessible, affordable, and relevant through cutting-edge technology. With a focus on streamlining operations and enhancing performance, Peak3 offers a comprehensive suite of solutions, including insurance core systems, distribution channels, and AI-powered tools.

Since its inception in 2018, Peak3 has rapidly gained recognition, culminating in a recent win at the 2024 Insurance Asia Awards. We caught up with CEO Bill Song to learn more about his entrepreneurial journey and the future of Peak3.

What led you into the insurance industry in the first place – and how did your background play a part in that? 

It was a coincidence! I am a chemical engineer by training and started my career in a GE Plastic plant (petrochemicals division of General Electrics). I never thought I would work for an insurance company someday. In the early 2000s, GE was famous for its “Six Sigma” methodology. It was (and still is) a well-respected quality management system, requiring the organisation to build a continuous improvement culture. 

I was a Six Sigma “black belt” and oversaw all process improvement projects across four chemical plants. When Allianz built its quality system – “OPEX – operational excellence” in 2007, they approached me and brought me to the insurance industry. 

Continuously improving efficiency is a universal pursuit of every great company across industries. I am so lucky to have had this culture engraved into my DNA in my early days. 

What was the inspiration behind founding Peak3?

The inspiration to found Peak3 is mainly driven by two experiences: 

The first is from my time at Allianz. I became the COO of Allianz China P&C, in which role I also oversaw technology and deeply understood the importance of the IT system. IT very much determined the company’s efficiency, base cost, and business competitiveness. I changed many processes and greatly improved the efficiency. However, I always struggled with the heavy cost of the legacy IT infrastructure. 

The yearly budgeting and planning process for all the maintenance and change requests for our highly customised core system was very painful. Back then, I wished to just have a SaaS core system that stayed evergreen through continuous tech and functional upgrades, instead of spending most of my efforts on maintaining a legacy system in-house.

The other experience is from my time at ZhongAn, the largest digital-only insurer and pioneer in embedded insurance. I joined ZhongAn as one of the early employees as Head of Product and Head of Motor Insurance. We iterated and launched novel insurance products multiple times a week in collaboration with digital platforms, issuing billions of (micro-)policies per year – and at the peak over 50,000 policies per second. There was simply no insurance core system available on the market to support such flexibility, integration capabilities, and performance. So, we built it in-house.

Building on these experiences, I knew there must be a clear market opportunity for a truly upgradeable, cloud-native SaaS core system that not only addresses maintenance challenges but also provides the basis for the next round of innovative product propositions and partnership-based distribution models.

How have you funded the enterprise – and what was/is your investment strategy?

In the early days, we had the privilege of receiving diverse incubation support by ZhongAn, while being supported by financial investors. Now we are operating as a standalone company and recently welcomed two new investors: EQT, the global private equity powerhouse, and Alpha JWC Ventures, one of the leading venture capital firms in Southeast Asia. 

While our roots are in Asia and we are committed to the region, our investments are now strongly focused on growing in the EMEA region.

What were some of the biggest challenges you faced during the early stages of building Peak3, and how did you overcome them?

Many of our clients are mature and successful insurance companies, often used to customising technology to adjust it to existing/legacy processes, instead of exploring how productised technology, such as ours, can help transform not just the tech stack but also the processes and broader operations. Helping clients see the long-term transformative business value of these changes has been one of the biggest challenges.

As we were building our products in parallel as we were engaging such mature clients, we also had to make concessions and build customisations, as we simply couldn’t build all the functionality at the required speed in our baseline product. 

What really required discipline, was continuously cleaning up such technical debt from customisation, before it could pile up. Internally, we called this “cleaning the junk” – a continuous process of removing previous customisations and replacing it with proper productised functionalities via regular software upgrades. This incurred significant cost and effort, but allows us to operate with one global code base and with very minimal technical debt, enabling us to scale more quickly and efficiently now.

How do Peak3’s cloud-native SaaS solutions differentiate from other Insurtech offerings in the market, particularly in terms of core modernisation and AI integration?

When referring to Peak3, I don’t like the term insurtech that much, as it is a very broad term – and many people associate digital insurers/MGAs/brokers or some “point solution” providers with the term insurtech. Peak3 is a vertical software provider focused on the insurance industry with our end-to-end SaaS core system with integrated data and AI capabilities. Our focus is not to compete with insurtech start-ups but rather with the established core system vendors.

In the space where we are competing, I see two main areas of differentiation. One is technology-driven, the other mindset/business model-driven:

We are delivering a true SaaS core system. What does this mean? Our core system is cloud-native and cloud vendor agnostic. It is 100% microservices-based and follows open architecture principles. Now, most competitors claim something similar, but nobody is delivering it in practice and at scale. Just one example, in Singapore we have some 10 clients across P&C, Life and Health from five countries running on a shared multi-tenant instance – with upgrades deployed on a bi-weekly basis with cross-cloud disaster recovery. 

I could now spend quite a while explaining the diverse business benefits of this, but I want to focus on your question on core modernisation and AI integration. When it comes to core modernisation, one benefit of our microservices architecture is that we are significantly more flexible in the modernisation journey, being able to enable gradual modernisation journeys that are either horizontal (i.e., modernising one insurance business line end-to-end at a time) or vertical (i.e. modernising a functional domain such as claims across all/multiple business lines) – or any combination thereof. We can tailor to the client, start off small, deliver value quickly and then expand, de-risking the process. 

Another important topic is the multi-tenant capability: Most insurers struggle to get operations and technology synergies across markets. We are now working with a large European insurer to move six countries onto one core system on one centrally hosted cloud instance, with harmonised products and processes. This improves governance/control, reduces costs and builds the basis for a scalable business model. This is simply not possible with the legacy monolithic, on-premise or single-tenant solutions otherwise available in the market.

Regarding AI, we are investing ourselves to enrich our solutions with AI functionalities, but ultimately what sets us apart is the ability to easily integrate with third party AI solutions. This is again enabled by our architecture and tech stack: We can expose every kernel API from a microservice to interact in real-time with AI models, enabling in the future autonomous “AI agents” that can independently operate all main processes – but this obviously will also need proper compliance/risk/oversight processes in place. We also provide a pre-integrated open architecture customer data platform…because AI has no value if you don’t have the underlying data.

The second area of differentiation (besides technology) is really mindset- and business model-driven. We started off focusing on innovative digital and embedded insurance business models and only subsequently moved into traditional insurance products and distribution models. But we bring this digital/innovation-first approach to the “traditional” scenarios. 

Separately, we are not only working with insurers, but also many non-traditional insurance intermediaries (such as digital platforms). We are creating network effects and new business opportunities working both with the insurers and intermediaries. Just as an example, in Japan the top three P&C insurers use our system, as do some of the largest digital channels (such as PayPay, the largest digital payments/wallet provider) – all on one integrated system that facilitates and streamlines insurance transactions.

Tell us about an impactful case study where Peak3’s solutions have delivered a step change in performance for insurers, MGAs, or insurance intermediaries?

I have already mentioned the multi-country core modernisation project in Europe. I have not really seen anyone doing something similarly ambitious, as it is not just a technology but a true operating model and organisational transformation.

Another example that I always really like to use is our work with Grab setting up and running GrabInsure, the embedded insurance arm of Grab. Grab is the leading superapp in Southeast Asia, combining mobility/car sharing, delivery, and financial services, amongst others. Together with Grab, we have since 2019 built up GrabInsure to be one of the pre-eminent embedded insurance success cases in the world. 

We have not only provided the technology platform that powers hundreds of millions of insurance policies sold from over twenty different insurers across half a dozen countries, but also co-innovated new propositions that drive financial inclusion, making insurance more accessible, more relevant and more convenient. Such examples include daily commercial motor insurance or pay-per-trip critical illness insurance – all smoothly integrated into Grab’s core products and services.

What have you learned from your journey so far in terms of strategy, vision and people management?

You need to be in for the long game. We were always focused on a single code base strategy, meaning that we would continuously upgrade our client deployments to ensure the long-term scalability of our operations – even if it meant that we incurred a lot of additional efforts and costs in the past, when our product was not yet as mature.

We always had the vision and ambition to be the first true SaaS core across P&C, life and health insurance. But in pursuing this vision, we tried to do too much at the same time: a bit of “everything, everywhere, all at once”. This was too much for us as an organisation and team to handle and we started to prioritise ruthlessly, and while operating in an agile fashion, we work more sequentially now than in parallel.

As for people management, I believe I had a lucky hand in selecting many of my colleagues – particularly in the senior ranks. But naturally, there have also been bad hires, not necessarily because of their skillset, but also because of cultural fit. In the early days, I and the organisation more broadly were more patient in this regard. But I realised we are neither doing us a favour, not the affected person – so we are pursuing quicker separations where needed. 

Very positive areas for us have been campus recruiting programs: many of our most successful, innovative, highest performing and loyal employees have come to us from campus/graduate recruiting or internship programs. This is really an area we want to double down on, while in parallel bringing in more senior advisors to provide guidance to both our teams and clients – particularly as we enter new markets.

Looking ahead, what are your priorities for Peak3 as the company continues to grow and evolve in the rapidly changing Insurtech landscape?

As mentioned before, we are here for the long game. While we continue to invest into our own teams, products and AI capabilities, one of our core priorities is the expansion of partnerships with other technology and companies, consultancies and system integrators. I don’t want to use the term “ecosystem building”, as it is an overused expression. But creating diverse win-win partnerships is critical for our growth path. Ultimately, insurance is an open and collaborative industry…and we want to play our part.

Join Bill Song and Peak3 at Insurtech Insights Asia 2024 in Hong Kong

Join Bill Song, Group CEO and Co-founder of Peak3 at Insurtech Insights Asia 2024⁠⁠ on December 4th and 5th 2024 at the Kerry Hotel in Hong Kong, where he will be sharing his insights on SaaS Solutions for the insurance industry. The conference will welcome 5,000+ insurance leaders, entrepreneurs, investors, and policymakers from 50+ countries, with 71% of attendees expected to be C-level executives⁠. For more information, visit here

Interview by Joanna England