Israeli-Founded InsurTech Startup Lemonade Raises $300M, With Valuation at Reported $2B

Israeli-founded, NY-based insurance startup Lemonade has raised $300 million in a Series D funding round led by Japan’s Softbank Group …

Israeli-founded, NY-based insurance startup Lemonade has raised $300 million in a Series D funding round led by Japan’s Softbank Group Corporation, with participation from Allianz, General Catalyst, GV, OurCrowd and Thrive Capital. Forbes reported that a source said the investment now brings Lemonade’s value to over $2 billion

Lemonade uses behavioral economics, artificial intelligence and chatbots to deliver renters and homeowners insurance policies and handle claims quickly for users in nearly two dozen states across the US. It offers renters insurance starting at $5 per month, and homeowners insurance starting at $25 per month.

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The latest funding round brings total financing for Lemonade to $480 million.

The investment is set to help Lemonade expand beyond the US, with sights set on Europe where it operates its local HQ in Amsterdam.

The company was founded in 2015 by veteran Israeli tech entrepreneurs CEO Daniel Schreiber, former president of Powermat, and president and CTO Shai Winniger, a co-founder of Fiverr.com.

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Lemonade Raises $300M in Series D Funding

The round was led by SoftBank Group, with participation from Allianz, General Catalyst, GV (formerly known as Google Ventures), OurCrowd, and …
Daniel Schreiber
Daniel Schreiber

Lemonade, a NYC-based insurance company powered by artificial intelligence and behavioral economics, raised $300m in Series D funding.

The round was led by SoftBank Group, with participation from Allianz, General Catalyst, GV (formerly known as Google Ventures), OurCrowd, and Thrive Capital.

The transaction – which is subject to customary closing conditions including regulatory approvals – is targeted to close in Q2 2019.

The company plans to use the funds to accelerate its US and European expansion in 2019, and explore new product lines.

Founded by tech veterans Daniel Schreiber and Shai Wininger, Lemonade is licensed as a full-stack property and casualty insurance carrier. The company began offering homeowners and renters insurance in New York in late 2016, and is now available for most of the US population.

In addition to digitizing the entire insurance process, Lemonade reduces costs and bureaucracy through giving. As a Certified B-Corp, it takes a fixed percentage as a flat fee, eliminating the conflict between paying claims and making a profit, and donates a portion of unclaimed premium dollars to nonprofits during its annual ‘Giveback.’

FinSMEs

11/04/2019

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Insurtech BriteCo Raises $2 Million Seed Round, Targets Fine Jewelry Market

Insurtech BriteCo has announced a $2 million seed round led by Brian Spaly, the founder of Trunk Club, and Jeff Taylor, the former chairman and CEO …

Insurtech BriteCo has announced a $2 million seed round led by Brian Spaly, the founder of Trunk Club, and Jeff Taylor, the former chairman and CEO at Cole Taylor Bank. BriteCo is targeting the fine jewelry and watch market to provide insurance within minutes of purchase.

BriteCo explains that homeowners and renters insurance policies usually don’t cover the full value of fine jewelry or watches. It’s a fact that making a claim against a homeowners policy can bring premium increases or even canceled coverage. BriteCo offers a zero-deductible policy with coverage up to 125 percent of insurance replacement value.

BriteCo provides verified appraisals and immediate replacement coverage by insurance carrier HDI global. BriteCo’s coverage has no deductible, automatically updates protection each year using price analytics and predictive models, and claims a more streamlined claims experience.

BriteCo states that its cloud-based Appraisal Management System (AMS) is faster and more accurate than the jewelry industry’s traditional manual processes.

BriteCo provides partner jewelers with a new source of revenue while improving their in-store customer experience. Once an appraisal is completed customers receive an immediate insurance quote via email or text, which allows them to purchase coverage within minutes, even before they leave the store.

Dustin Lemick, BriteCo founder and CEO, says that as a third-generation jeweler, my family and I have a long history in the business:

“But the jewelry buyer is changing rapidly. Millennials now represent the largest jewelry buying demographic, and their expectations are different from those of prior generations. BriteCo helps jewelers by providing them with the optimal blend of online convenience and personal attention.”

Investor Jeff Taylor says the company has accomplished quite a lot in a short period of time:

“Getting BriteCo licensed in virtually every state before officially launching is a testament to their hard work and the professionalism with which they’re approaching this big challenge. I’m excited to be a part of their push to modernize the jewelry insurance and appraisal process and to help millions of people across the US protect their most valuable possessions.”

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Here are some new ways to buy insurance that could save you money

Among the insurtech innovations: leveraging artificial intelligence to reduce call times with agents, using data to deliver a wider range of benefits, and …

Finding an affordable car insurance policy seemed like an impossible task for Nicole Scheufler. She lives in a busy part of San Diego and has been rear-ended a few times. After her last car wreck, “the insurance rates were insane,” she says.

But she found a policy, thanks to a new way of buying insurance called Gabi.

Scheufler, a research scientist, discovered Gabi’s app, which searches for an affordable insurance policy and allows you to compare policies.

Using technology to save you money on insurance

Gabi is part of a group of insurance sellers int the emerging insurtech space, mostly startups that use technology to find both savings and efficiency in the insurance industry. They’re also turning the industry’s focus away from making quick sales and toward building long-term relationships that could benefit both consumers like Scheufler and forward-looking insurance companies alike.

“We do the shopping for customers who sign up,” explains Hanno Fichtner, Gabi’s CEO. “For most customers, we are able to find a better policy. But if we don’t, we tell them, ‘Stay put, you already have a great policy.’ We are transparent, where most traditional insurance sales organizations are all about the sale.”

The Gabi app helped Scheufler find a policy through Clearcover for her 2015 Mazda CX5 that cost about $100 a month, hundreds less than her previous policy.

“Clearcover was the only insurance company with a reasonable rate,” she says.

Her experience is repeating itself hundreds, if not thousands of times a day. Insurtech is one of the hottest insurance trends, according to experts.

“Millions of dollars have been invested in startups bent on disruption, and a lot of the changes are designed to make the buying process much simpler for consumers,” says Virginia Hamill, an insurance analyst at FitSmallBusiness.com, a personal finance site.

Among the insurtech innovations: leveraging artificial intelligence to reduce call times with agents, using data to deliver a wider range of benefits, and even harnessing virtual reality and gamification to complete health screenings, says Hamill.

New ways of buying insurance

As it turns out, Clearcover is also part of this disruption. The company, founded in 2016, was built to make buying insurance fit naturally with moments when insurance is actually relevant to consumers, explains Kyle Nakatsuji, Clearcover’s CEO.

“We believe that the old paradigm of insurance marketing is being replaced by new insurance distribution powered by context, efficiency, and relevance,” he says.

How is Clearcover delivering it? It has an application program interface (API) that works with companies that offer insurance advisory, automotive, or financial services and are interacting with consumers when insurance is relevant to seamlessly serve up Clearcover in the moment.

“Because we built Clearcover’s operations and technology platform from scratch to support this emerging distribution model, we can operate much more efficiently than other insurance companies,” he says. “As a result, our customers, on average, see much lower rates from Clearcover.”

And that’s how Clearcover could offer Scheufler such a huge discount.

It’s the API, baby.

More new ways of buying insurance

Insurance companies aren’t letting the startups have all the fun. Take Penn Mutual, the 172-year-old life insurance company based in Horsham, Pa. Last year, the company rolled out what it calls the Accelerated Client Experience (ACE), a new digital platform that streamlines the application process and decision-making time from an industry average of 30 days to as little as 24 hours.

“As of January, over 1,800 advisers have submitted business through ACE, representing $8.5 billion in life insurance face amount with 60 percent of eligible cases being submitted on the platform,” says Penn Mutual president Dave O’Malley.

It’s not just how you buy insurance but what you insure. For example, Traverse Insurance allows you to choose from a list of items you want to insure, including personal electronics, sporting equipment, musical instruments, cameras, and jewelry. It also offers liability, ID fraud and travel insurance.

“It’s a completely new way to buy insurance,” says Beth Maerz, senior vice president of customer experience and innovation at Travelers. “It’s designed for consumers who may not need a traditional home or auto policy. It can serve as an alternative to renters insurance by including personal liability coverage that meets most landlord requirements. It also offers identity theft coverage and protects things like mobile phones, laptops, musical instruments, jewelry and even some vacation experiences.”

Coverage varies. For example, you can insure your smartphone and other electronics starting at $2 a month, while $100,000 in liability coverage cost $2.95.

Shifting attitudes toward buying insurance: it’s about the consumer

There’s a broader theme here. The insurance business is slowly shifting from one focused on sales to one focused on people.

“Traditional quote comparison sites attempt to immediately monetize the customer and often view customers as leads they can sell in the broader insurance marketplace,” says Fichtner, Gabi’s CEO.

Previous online sales efforts have harvested email addresses and phone numbers from prospects and then spammed them with sales pitches. In the short term, that’s the most profitable way of selling insurance.

But according to Fichner, “There’s much greater value in building a relationship with consumers and having the opportunity to serve their insurance needs.”

“A key value proposition of our approach to insurance is to remain the customer’s licensed, professional insurance advisor indefinitely,” he adds.

To that end, Gabi encourages users to create an online account where they can monitor their insurance and compare rates again without having to fill out more forms. The focus has shifted to the consumer and to building a long-term relationship that can yield repeat sales.

More efficient

“Insurance distribution doesn’t have to consist of paper, phone calls, or billions in TV ads,” says Nakatsuji, Clearcover’s CEO. “Instead, digitally empowered advisors of all kinds will be able to provide consumers access to better products at lower prices due to partnerships with more efficient insurance carriers.”

But it’s not perfect. I signed up for the Gabi app and felt a little nervous about handing over a lot of the personal information it requested, such as my email, cell phone number, and the password to my existing insurance account. For reasons that aren’t entirely clear, Gabi didn’t accept the password and asked me to download a copy of my current policy, which took a while to find. That was three days ago. I’m still waiting for my quote.

A Gabi representative said the site had “an unexpected 500 percent increase in traffic in last two days,” which led to my delay.

Still, this combination of technology and a new focus on consumers has the potential to turn the insurance industry on its head — if it hasn’t already.

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These New Ways Of Buying Insurance Might Save You Big Bucks

Gabi is part of a group of insurance sellers int the emerging insurtech space, mostly startups that use technology to find both savings and efficiency in …

Finding an affordable car insurance policy seemed like an impossible task for Nicole Scheufler. She lives in a busy part of San Diego and has been rear-ended a few times. After her last car wreck, “the insurance rates were insane,” she says.

But she found a policy, thanks to a new way of buying insurance called Gabi.

Nicole Scheufler and her new car.Nicole Scheufler

Scheufler, a research scientist, discovered Gabi’s app, which searches for an affordable insurance policy and allows you to compare policies.

Gabi is part of a group of insurance sellers int the emerging insurtech space, mostly startups that use technology to find both savings and efficiency in the insurance industry. They’re also turning the industry’s focus away from making quick sales and toward building long-term relationships that could benefit both consumers like Scheufler and forward-looking insurance companies alike.

“We do the shopping for customers who sign up,” explains Hanno Fichtner, Gabi’s CEO. “For most customers, we are able to find a better policy. But if we don’t, we tell them, ‘Stay put, you already have a great policy.’ We are transparent, where most traditional insurance sales organizations are all about the sale.”

The Gabi app helped Scheufler find a policy through Clearcover for her 2015 Mazda CX5 that cost about $100 a month, hundreds less than her previous policy.

“Clearcover was the only insurance company with a reasonable rate,” she says.

Her experience is repeating itself hundreds, if not thousands of times a day. Insurtech is one of the hottest insurance trends, according to experts.

“Millions of dollars have been invested in startups bent on disruption, and a lot of the changes are designed to make the buying process much simpler for consumers,” says Virginia Hamill, an insurance analyst at FitSmallBusiness.com, a personal finance site.

Among the insurtech innovations: leveraging artificial intelligence to reduce call times with agents, using data to deliver a wider range of benefits, and even harnessing virtual reality and gamification to complete health screenings, says Hamill.

Kyle Nakatsuji, Clearcover’s CEO.Clearcover

New ways of buying insurance

As it turns out, Clearcover is also part of this disruption. The company, founded in 2016, was built to make buying insurance fit naturally with moments when insurance is actually relevant to consumers, explains Kyle Nakatsuji, Clearcover’s CEO.

“We believe that the old paradigm of insurance marketing is being replaced by new insurance distribution powered by context, efficiency, and relevance,” he says.

How is Clearcover delivering it? It has an application program interface (API) that works with companies that offer insurance advisory, automotive, or financial services and are interacting with consumers when insurance is relevant to seamlessly serve up Clearcover in the moment.

“Because we built Clearcover’s operations and technology platform from scratch to support this emerging distribution model, we can operate much more efficiently than other insurance companies,” he says. “As a result, our customers, on average, see much lower rates from Clearcover.”

And that’s how Clearcover could offer Scheufler such a huge discount.

It’s the API, baby.

More new ways of buying insurance

Insurance companies aren’t letting the startups have all the fun. Take Penn Mutual, the 172-year-old life insurance company based in Horsham, Pa. Last year, the company rolled out what it calls the Accelerated Client Experience (ACE), a new digital platform that streamlines the application process and decision-making time from an industry average of 30 days to as little as 24 hours.

“As of January, over 1,800 advisers have submitted business through ACE, representing $8.5 billion in life insurance face amount with 60 percent of eligible cases being submitted on the platform,” says Penn Mutual president Dave O’Malley.

It’s not just how you buy insurance but what you insure. For example, Traverse Insurance allows you to choose from a list of items you want to insure, including personal electronics, sporting equipment, musical instruments, cameras, and jewelry. It also offers liability, ID fraud and travel insurance.

“It’s a completely new way to buy insurance,” says Beth Maerz, senior vice president of customer experience and innovation at Travelers. “It’s designed for consumers who may not need a traditional home or auto policy. It can serve as an alternative to renters insurance by including personal liability coverage that meets most landlord requirements. It also offers identity theft coverage and protects things like mobile phones, laptops, musical instruments, jewelry and even some vacation experiences.”

Coverage varies. For example, you can insure your smartphone and other electronics starting at $2 a month, while $100,000 in liability coverage cost $2.95.

Shifting attitudes toward buying insurance: it’s about the consumer

There’s a broader theme here. The insurance business is slowly shifting from one focused on sales to one focused on people.

“Traditional quote comparison sites attempt to immediately monetize the customer and often view customers as leads they can sell in the broader insurance marketplace,” says Fichtner, Gabi’s CEO.

Previous online sales efforts have harvested email addresses and phone numbers from prospects and then spammed them with sales pitches. In the short term, that’s the most profitable way of selling insurance.

But according to Fichner, “There’s much greater value in building a relationship with consumers and having the opportunity to serve their insurance needs.”

“A key value proposition of our approach to insurance is to remain the customer’s licensed, professional insurance advisor indefinitely,” he adds.

To that end, Gabi encourages users to create an online account where they can monitor their insurance and compare rates again without having to fill out more forms. The focus has shifted to the consumer and to building a long-term relationship that can yield repeat sales.

And it’s more efficient, too.

“Insurance distribution doesn’t have to consist of paper, phone calls, or billions in TV ads,” says Nakatsuji, Clearcover’s CEO. “Instead, digitally empowered advisors of all kinds will be able to provide consumers access to better products at lower prices due to partnerships with more efficient insurance carriers.”

But it’s not perfect. I signed up for the Gabi app and felt a little nervous about handing over a lot of the personal information it requested, such as my email, cell phone number, and the password to my existing insurance account. For reasons that aren’t entirely clear, Gabi didn’t accept the password and asked me to download a copy of my current policy, which took a while to find. That was three days ago. I’m still waiting for my quote.

A Gabi representative said the site had “an unexpected 500 percent increase in traffic in last two days,” which led to my delay.

Still, this combination of technology and a new focus on consumers has the potential to turn the insurance industry on its head — if it hasn’t already.

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