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Shanghai startup taking Hong Kong insurers’ pulse

The tech company hopes to export its healthcare apps and SaaS model to insurers in Hong Kong and beyond.

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A startup in Shanghai that uses digital technology to connect mainland Chinese people with healthcare – and to help insurance companies win business – is preparing to expand operations to Hong Kong and Southeast Asia.

The CareVoice, founded in 2014, gives people in China digitized interfaces with private hospitals and clinics, and helps insurance companies develop more regular, health- and well-being contact with affluent consumers. The service went live in 2016 with AXA Tainping Insurance and now has five insurers as clients, including Ping An Insurance.

For example, it provides consumers with comparison information and helps them book appointments in tier-1 cities. Unlike Ping An Healthcare and Technology (a.k.a. Ping An Good Doctor, a spinoff of Ping An Insurance), CareVoice deals only with private healthcare centers.

Good Doctor listed last week on the Hong Kong stock exchange, raising $1.1 billion on Friday, April 27, but its stock price suffered a terrible second day of trading, with shares down 11% on Monday, May 7, probably due to concerns about the company’s lack of profits.

Doctor, doctor, gimme the news
The search for profitability is what is prompting CareVoice to look to enter international markets this summer, says Sebastien Gaudin, founder.

“The B2C model is valid, but it requires funding, and it’s hard to do in China as a foreign-owned company,” Gaudin told DigFin. The affluent segment interested in using apps to select private healthcare is limited. “We’re not a mass-market play in China,” he said, noting that many consumers remain skeptical of private-sector care.

Good Doctor connects consumers to the public health system, which is vast in China, a legacy of the Communist Party’s iron rice bowl.

The B2C model is valid, but requires funding

- Sebastien Gaudin, The CareVoice

The CareVoice offers both apps for consumers, helping them compare hospitals and clinics, offering lifestyle tips, rewards, and insurance recommendations. It also has a software-as-a-service for insurance clients, to digitize claims, connect them to private hospitals, and provide group health services to employers.

“It’s doable as a B2B2C business, but you’re always going to be short of resources,” he said. The company raised a seed investment round of $2.2 million in December.

Hong Kong vs. Mainland China
Gaudin says the company is in talks with several insurance companies in Hong Kong, and he expects to sign the first deal in the city this quarter.

Hong Kong’s private healthcare landscape is very different from mainland China’s. The insurance industry is mature and demanding, so CareVoice needs to assure potential clients that its tech is robust. But Gaudin thinks his experience in working with mainland consumers can give Hong Kong’s traditional insurers a way to expand their connection with customers beyond pure payer roles.

“Insurance companies have limited client relationships,” Gaudin said. “Everything is brokered, so they lack actionable data and customer loyalty.”

Insurance companies have limited client relationships

- Sebastien Gaudin, The CareVoice

Also, unlike in mainland China, private hospitals in Hong Kong wield far more influence over both consumers and insurers. So his bigger challenge will not be signing up insurers, but getting hospitals and clinics to engage with the app. (Not to mention competing with local insurtechs.) The CareVoice does not charge hospitals to participate – it works independently of them so that it can provide neutral recommendations – but Gaudin wants providers to provide more information, in return for benefiting from aggregate insights.

“Some healthcare providers will accept us because we’re patient-centric,” he said, which can give them insight and data into their customers’ experiences and preferences. He also believes he will be able to deliver affluent mainland Chinese resident in Hong Kong, many of whom have not experienced private healthcare before.

In China, fewer than 10% of consumers have access to private care, but it’s a rapidly growing segment, particularly as employers begin to offer private health benefits to retain talent.

But if the Hong Kong and Southeast Asia forays are a success, Guadin hopes to take the business into Europe and North America as well. He hopes The CareVoice grows fast, profitably, and becomes a partner for tech companies – and either sells a strategic stake to an insurance-related multinational, or goes IPO – presumably with a healthier debut than Good Doctor’s.

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Shanghai startup taking Hong Kong insurers’ pulse