Ottonova Takes Health Insurance Online

When Frank Birzle set out to start a healthcare company in his native Germany, he did what many people do: he Googled how to do it. But “how to start a health insurance company in Germany” didn’t return any results. “It was quite surprising,” he says. “How many times does it happen to you nowadays that you actually Google something and you get zero results?” There was no existing playbook—it was a completely blank canvas. So Birzle decided to take a slightly old-fashioned approach to his digital age idea: “We did it like a roadshow,” he recalls. “We drove around and looked at all the different components we needed to build.” To map it out, “I went to a whiteboard and I drew the main architecture of how the system has to be built.”

In June 2017, ottonova launched as the first fully digital private health insurance company in Germany. (In fact, it was the first new private health insurance company founded since 2000.) Their unique proposal is that they sell health insurance completely online and simplify the entire customer experience. Prospective customers can calculate their premium online and sign up within a few minutes. Customers can then manage everything health insurance-related online in a native app.

Birzle’s background is in e-commerce, but the first concept he had for the architecture turned out to be spot on. “Of course, it’s much more detailed and way more sophisticated than my initial doodle was, but it turns out to be pretty much that set up that I imagined in the first place,” Birzle says. He teamed up with Andreas Katzig, an old acquaintance from university. They hadn’t seen each other in ten years until they ran into each other, in 2016, at the AWS Summit. “There’s this big brick wall nobody is touching. We just wanted to be the first touching it and breaking it,” Katzig says about the challenge. He came onto the team as VP of engineering.

The ottonova team gave themselves six months to build the product and get the necessary regulatory approval. “The first timeline until going live was six months,” says Katzig. Because the field is wide open, Birzle and his teams built everything from scratch. They were able to avoid legacy software and pick only the best third-party vendors. As a result, they only use AWS certified services, and they keep all the data in Germany. They named the company ottonova after Otto von Bismarck, who established the first health insurance in Germany.

At first, people told ottonova that there was no way they could sell a product as complicated as insurance online. Usually, private insurance is purchased through an insurance broker. Plus, health insurance has a long lag between first contact and signing up, sometimes as long as six months. So ottonova targets what they call “first movers, people that usually want to try stuff first, like the typical guys that buy a Tesla,” who are less likely to be scared off by being insured by a startup. They also designed their account setup process to be as easy and as safe as possible. The company uses two-factor authentication to protect any potential customer’s data, which can be incredibly sensitive.

In contrast to the usual expectations for insurance companies, ottonova took a customer-centric approach. Customer support is rebranded as a concierge service, and all of its features are available through chat. Customers can request appointments through the app, or find a new doctor. Customer service representatives are also real people, not the chatbots that so many companies have come to rely on. ottonova positions itself as a premium company, so they want to make sure their customers get the best service possible. Patients can give detailed health information and know that a real human being is handling it. “You can basically talk to us as if you would be talking to your doctor,” says Birzle.

Health insurance is so carefully regulated at the national level that ottonova doesn’t have any current ambitions to go international. But it continues to grow throughout Germany, including among foreign residents for who they even offer a special tariff. Last June, it launched a special insurance rate for German civil servants and offered telemedicine to all its’ customers as the first private health insurance in Germany.

Now, when you google “How to start a health insurance company in Germany,” you should start to see the story of a company that drew its own roadmap to health insurance innovation.