Insurtech: here are the 11 startups undergoing insurance changeover

Decisive was the last year that witnessed the consolidation of the best international insurtech startups, some of which have reached the status of unicorn in the insurance industry representing the players likely to change the market. Here is an overview of the 11 most interesting insurtech companies worldwide

03 Jun 2020

Donatella Cambosu

Redattore


According to Willis Towers Watson, global insurtech investment reached $6.37 billion in 2019, a new record, so much so that the 2019 figures represent 33.9 percent of the global figure collected in the industry. 

During the year, eight investment rounds created five new unicorns (start-ups worth over $1 billion), nine rounds recorded transaction values totalling over $100 million. 2019 also saw a 90% jump in investment rounds of over $40 million, while small investments decreased, implying a growing market maturity. 

In short, 2019 was crucial to consolidate the best international insurtech startups, some of which have reached the status of unicorn in the insurance landscape and are now the players ready to change the market, determine new behaviors and implement the change brought about in the industry. 

Mr. Andrew Johnston, global insurtech manager at Willis Re, commented in a press release: “In 2019, Insurtech startups began to dominate specific segments of the market, both in specific business lines and in the use of particular technologies. For example, Concirrus, a UK-based company, is now clearly the forerunner in behavioural analysis for specialist markets. Yet while insurtech reports are characterized by huge evaluations and ‘postulates of the art of the possible’, there is also a very real story that is not so positive, represented by failures. The number is very hard to quantify, although our data reveal that in the last three years about 184 funded insurtech companies may have shut down”. 

So what are the unicorn companies that are globally transforming insurance? 

 

Insurtech unicorns 2020 

Wefox Group 

Wefox Group is running with wefox, a digital platform that connects insurance providers, distributors and customers (basically a broker), and ONE, a consumer app that aims to reinvent the insurance service by exploiting data while paying great attention to their protection. Its pillar is the customer experience. Today the company, founded in 2017, serves over 1,500 brokers and more than 400,000 customers. It has raised about $268 million in several investment rounds and has now become the first European insurtech unicorn. 

Rating: $1.68 billion 

Headquarters: Berlin 

Lemonade 

Lemonade, the insurance company covering content and liability for urban residents is a B-Corporation certified company that focuses on returns through charitable donations with leftover money from the user’s insurance pool. Operating reversing the traditional insurance model, it takes a fixed fee, pays claims within minutes and donates the leftovers to the charity. Also, like many financial companies today, Lemonade has an AI bot, Maya, integrated into its messaging services to provide quotations and advice, allowing customers to get insurance in few seconds. It is available in the U.S. and Germany. It has recently taken an interest in pet insurance policies. 

Rating: $2 billion 

Headquarters: New York 

Oscar Health 

Oscar is a health insurance company that uses technology, design and data to humanize health care. The company offers plans to individuals, couples and families living in areas of New York, New Jersey, California and Texas who do not receive health insurance from their employers. To date, it has raised about $1.3 billion in investments. It was founded by Mario Schlosser and Joshua Kushner (Kushner’s brother married to Ivanka Trump and advisor to the president). It currently has 400,000 customers expected to turn into 2 million in sales by 2020. 

Rating: over $3.2 billion (source: Business insider) 

Headquarters: New York 

Hippo 

It was born in California from the initiative of two serial entrepreneurs of Israeli origin and is revolutionizing the home insurance market, addressing its proposals to end consumers. Its business model, based on the use of different integrated technologies, has allowed it to gain big investors throughout its development and recently to close a $100 million round. Hippo has developed a system of integrated technologies (sensors connected to the Internet, satellite imagery, automation, big data) to offer homeowners better and ideally cheaper insurance policies. 

Rating: $1 billion (source: Fortune) 

Headquarters: San Francisco 

Next Insurance 

Since its inception, Next Insurance has focused on commercial insurance for professionals and small businesses. Its mission is to make accessible, easy, transparent, fulfilling, fast and low cost the subscription of a policy for micro-enterprises to all those small business and professional activities until now quite forgotten by the insurance system: the barber, the beauty salon, the personal trainer, the photographer, the bricklayer, the babysitter, the masseur, the laundry service, the housekeeper, the DJ, the event planner. 

A people of professionals the company offers both a general liability policy that covers any damage or accidental injury to persons or property in the performance of each profession; and a professional liability policy covering claims for negligence and professional misconduct. 

Rating: € 1 billion (source: Crunchbase) 

Headquarters: Palo Alto 

Bright Health 

Co-founded in Minneapolis by a seasoned insurance industry, former CEO of United Healthcare, and two other health care managers, Bright Health was established in the U.S. insurtech environment as early as 2016, when it received an initial funding of $80 million. The company was created customer-centric, thanks to the use of big data. It leverages the customer experience by offering healthcare services through an app. 

Rating: $1 billion 

Headquarters: Minneapolis 

Root Insurance 

Root Insurance was the first “mobile-first” insurance company authorized in the US. It is data-driven, i.e. is based on you, rather than your demographics: using smartphone technology, it monitors driving behaviour and defines who is a safe driver and who is not. By insuring only safe drivers, Root can offer cheaper car insurance rates. 

Rating: $3.65 billion 

Headquarters: Columbus 

Metromile 

Metromile is currently the leading pay-per-mile car insurance company in the United States. Based on the use of big data and machine learning technologies, Metromile is expanding its community of loyal drivers thanks to the savings it manages to grant and to the overall customer experience it offers. 

It has also developed AVA, a claim settlement system driven by Artificial Intelligence, designed to accelerate the assessment and payment process of insurance claims. Using Metromile pulse sensor data, AVA is able to retrace the event scene to immediately determine whether the claims details are accurate. When the claim is verified, Metromile can automatically approve payments within seconds. 

Recently, it has been experiencing Covid emergency and has cut a third of its staff, but its position remains strong. 

Rating: 1 billion euros 

Headquarters: San Francisco 

Growing insurtech startups 

Zego 

Zego became the first British insurer to obtain its insurance licence. The insurtech startup was founded in 2016 and focuses on offering flexible, on-demand insurance policies for workers in the gig economy, in segments such as ride-hailing, ride sharing, car rental and scooter sharing. The pay-as-you-go structure and the effective policy customisation via app, phone and web ensure that accessibility and ease of use are perfect for its services. 

The start-up continues to launch new products and expand into new countries. It offers a range of flexible options for automotive, professional and commercial insurance. 

It also has a business-to-business (B2B) offering, in which it works with companies such as UberEats, Deliveroo and Stuart, allowing it to offer Zego services to their drivers. 

Investments raised to date: $57 million (source: Crunchbase) 

Headquarters: London 

Read more in this article. 

Alan 

Alan offers medical insurance policies to citizens, businesses, hotels and restaurants in a fully digitized and manageable way via their smartphone. The numbers are extremely promising: in the last year, users have gone from 27 thousand to 76 thousand, and profits have increased by 165%. 

Investments raised to date: $140.9 million (source Crunchbase) 

Headquarters: Paris 

Read more about the latest investment in this article. 

Shift Technology 

It has developed a software-as-a-service (SaaS) that leverages big data and artificial intelligence, designed to detect potential insurance fraud and automate the claim. The company’ software uses mathematical models and algorithms to detect fraudulent behavior and support claim managers in a much more accurate and faster decision-making process. By working with many insurance companies and accessing data from many databases, Shift can steadily improve its algorithms and be more accurate in detecting insurance fraud. 

Investments raised to date: 100 million dollars 

Headquarters: Paris 

Read more about claim management startups in this article 

 

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Donatella Cambosu
Redattore

Scrive di tecnologie, startup e innovazione da oltre 15 anni. Dal 2015 collabora con il Gruppo Digital360, in particolare con le testate Startupbusiness, University2Business, EconomyUp. Collabora con InsuranceUp sin dal lancio del portale avvenuto nel 2015 e ha maturato un'ampia esperienza in ambito insurtech.

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