Aviva To Invest In Hoberman Tech Incubator

Aviva (Other OTC: AIVAF - news) , the FTSE-100 insurer, is to back the technology incubator founded by one of Britain's most prominent digital entrepreneurs in an effort to forge a new wave of financial services start-ups.

Sky News understands that Aviva will announce on Wednesday that it is investing millions of pounds in Founders Factory, a digital accelerator launched last year by Brent Hoberman, a co-founder of Lastminute.com.

Under the deal, Aviva will be Founders Factory's exclusive financial services partner, echoing agreements with companies in other industries such as L'Oreal, the consumer products giant, and Guardian Media Group.

The partnership will highlight the potential for technology to disrupt traditional insurance sector models, partly through a more effective use of customer data to deliver more targeted services to consumers.

New (KOSDAQ: 160550.KQ - news) generations of connected devices are providing insurers with unprecedented volumes of data, enabling them to speed up claims-handling and offer micro-policies focused on individual products.

Andrew Brem, Aviva's chief digital officer, said: "Insurance and financial services have been stuck in a bygone, analogue era when it comes to engaging with customers - we believe it’s high time to bring the industry into the digital age, for the benefit of customers and insurers alike."

The investment in Founders Factory will involve Aviva working with five existing digital businesses and forming two further start-ups each year for the next five years.

Sources said that was likely to entail Aviva Ventures, the group's wholly owned venture capital unit, providing roughly £20m in new capital annually.

The insurer's involvement will underline the extent to which major corporate names are seeking to enhance their innovation pipelines by partnering with dedicated technology incubators which seed ideas for disrupting long-standing business models.

In Aviva's case, its investments will target four areas: the internet of things, focusing on connected homes, health and cars; data and analytics; innovation in the area of customer experience; and distribution, including in relation to "sharing economy" platforms.

Mr Hoberman, who has backed a string of digital start-ups and other businesses since selling Lastminute.com more than a decade ago, said the partnerships created by Founders Factory would create a portfolio of "global winners (Other OTC: UBGXF - news) ".