The new investment round scored by CoverHound is the breaking news. This US startup has developed an innovative platform to compare and buy insurance policies, specifically in the automotive and real estate areas.
The latest investment by $33.3mil was led by ACE Group, one of the world’s largest insurance carrier, now holding 24% of the shares; this new investment from ACE comes just months after another financing amounting to $14mil. CoverHound, founded in 2010, has raised a significant set of investments leading the company to a strong acceleration over the last year, supporting the same to reach the goal of 50,000 policies sold with an increase of 170% over just 12 months
This news confirms the strong dynamism of the insurance industry in the US market (and not only) which is leading to the creation of many new tech insurance startups, attractive for large venture capitalists, and traditional insurance carriers as well (as InsuranceUp reported often).
“With ACE being an investor, will be moving more into small business and commercial,” said Keith Moore, Chief Executive Officer of CoverHound, reported the Insurance Journal “We’re really going to focus on extremely small business and we’re going to focus on startups”.
“It’s is a whole new market,” he said. “Nobody’s aggressive out there going after the startups and entrepreneurs.
CoverHound is certainly a great ambassador having been speeded up in a major US incubator, AngelPad, which in fact, will be the first business incubator that cooperates in the transaction.
“If you have a startup, you must have insurance cover before starting to raise funds and work, “said Moore.” We will provide the startup with a quick way to compare policies and get the most consistent with its target. Then, when the startup is growing, the policy will be widened as needed.”
What exactly is the strength of CoverHound? Which is its plus?
The answer lies partly in the technological platform, partly in the business model.
The web portal is fast, easy, user-friendly, with an attractive design, looks like reliable and competitive. This is the dream of the users who are looking for an online marketplace for comparing prices. You can buy, of course, but not only this.
According to TechCrunch, successful strategy for CoverHound is the offering of fulfilment services currently provided by none. This means that while some portals may make profit only from referral services, CoverHound also makes additional revenue by servicing the policy after it has been signed, thanks to claims processing for instance.
Another smart decision for CoverHound, turned out to be its partnership with Google Compare which led to very positive outcome, according to Moore, even outstanding.
Thanks to the new funds raised, the company plans to scale new States being more aggressive: technological development, development of innovative services, new hires and new partnerships, like the one with Google, are some of the new ideas at stake.
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