How to avoid debt early on and ensure success
Debt is becoming more and more common—for everyone! That’s right, even professionals who have earned university degrees are being affected by the negative impact of debt. In fact, according to newly released data from Statistics Canada, many of those who are living in thriving regions like British Columbia, Alberta and Ontario and earn at least $100,000 a year are in debt for close to two times their salaries. But why?
The same data also revealed that 71 per cent of all Canadian families held a form of debt in 2012. And while this number did include mortgages, it included something else: money borrowed for new cars, new kitchens and new clothes. Yes, the majority of debt comes from spending and splurging with credit cards. Therefore, the Canadian debt nation is believed to be mostly made up of middle and upper earners.
At one time, Canada used to be thought of a nation that did well at saving money. Specifically, in 1982, 20 per cent of all annual income was saved. But over time, that number has significantly lowered. In 2014, the per cent of annually income that was saved was just three point six, while the combined amount of debt for the country totaled $1.82-trillion.
The numbers are in and they aren’t good! Statistics Canada reported that households with at least $100,000 or more in total income account for 37 per cent of all debt in Canada, while those who earn at least $50,000 but less than $100,000 represent 38 per cent.
Therefore, the debt level in Canada has been determined “unsustainable” and in need of monitoring. Unfortunately, Canadians seem to get into a pattern of debt at an early age, which means they are living with debt longer. Specifically, the younger citizens acquire debt mostly due to students loans for college and then, of course, by taking out various credit cards.
However, the majority of household debt is actually what many consider to be middle class living: educations, vehicles and nice homes. While incomes haven’t increased much throughout the year, prices have considerable gone up. Therefore, something had to fill this gap: credit cards—quite the vicious cycle.
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CB Insights: US Insurtechs Compete In A Now Global Market
In the first half of the year, insurtech companies around the world have raised US$7.4bn, nearly doubling their funding in Q2. According to Digital Insurance, insurtechs have raised US$4.8bn in Q2—an 89% increase in funding from Q1. But US firms are no longer the sole beneficiaries.
What Are the Stats?
Out of the 15 Q2 mega-rounds—those that top US$100mn—only eight included American firms. Pretty good, you might say. That’s over half! But US companies only made up 38% of the deals, which marks a 10% drop from Q1 and a 12% drop from 2020. Technically, therefore, US insurtechs are less influential than they’ve been in the past. But who says this is a bad development?
Despite my American citizenship, I’d argue that a more globally diverse insurance market is only for the best. Many of the world’s citizens who could most benefit from improved insurance services live outside of the States—and deserve local, tech-savvy services.
Why Does This Matter?
You’re always going to see the typical insurtech contenders from Western countries. For instance:
- German-based wefox: US$650mn Series C
- UK-based Bought By Many: US$350mn Series D
- US-based Collective Health: US$280mn Series F
But it’s critical that we address risk across the world. American insurtechs might be some of the most technologically skilled firms in the industry, but it’s not their first goal to address floods in Southeast Asia, crop destruction in China, and COVID complications in South Africa. That’s why we should celebrate that the recent Q2 round included insurtechs from 35 different countries.
According to CB Insights’ Q2 2021 Quarterly InsurTech Briefing, this was the first time that they’d observed insurtech activity in Botswana, Mali, Romania, Saudi Arabia, and Turkey. And ‘from a product, service, distribution, and underlying risk perspective, we—as a society and as an industry—are moving at an unprecedented speed’, says Dr. Andrew Johnston, Global Head of Willis Re InsurTech.
Just ask CB Insights. InsurTech value propositions have resonated with the world.