Venadar published a “First View” of the Future of Insurtech in March 2021 to identify key trends driving innovation and illustrated those trends with our predictions about the best startups in each category. We forecasted that entrepreneurial companies in Data Optimization, Automation, and Risk & Fraud would make the biggest impact on the future of insurance. The report is one of our most successful to date – resulting in 1 of the profiled companies going public and 4 acquisitions. Additionally, investors validated our findings by pushing more than $476.48M into 12 of the profiled startups.
Among the 8 Data Optimization companies profiled, 1 was acquired, and 4 received funding
Insurers have access to rich data sets, and innovative solutions and analytical tools can help optimize data. Tools even have predictive analytic components that can anticipate trends, identify outlier claims, elucidate consumer behavior, and more. We profiled 8 startups with solutions for Data Optimization. Of those:
- REIN, an insurtech platform that uses data science tools to inform eligibility, underwriting, and loss prevention while also providing data-driven insights, raised $7.88M of venture funding in the form of convertible debt from undisclosed investors in May 2022.
- EZLynx, which offers a cloud-based real-time comparative rating software intended to help agents generate quotes from multiple insurance carriers with a single data entry point, was acquired by Applied Systems, via its financial sponsors Hellman & Friedman, CapitalG, JMI Equity, and Stone Point Capital, through an LBO in March 2021.
- Insurity, offering cloud-based software and analytics services for insurers, brokers, and managing general agents, received an undisclosed amount of development capital from TA Associates Management in November 2021. The company also completed a dividend recapitalization in November 2021.
- Counterpart, a liability management platform designed to predict claims and prevent them, raised $30M of Series B venture funding in
a deal led by Vy Capital in March 2022. Valor Equity Partners and Felicis Ventures also participated in the round.
- Corvus, a commercial insurance data platform designed to improve risk selection and management, raised $115.69M of Series C venture funding in a deal led by Insight Partners, Aquiline Capital Partners, and FinTLV Ventures in May 2021. Amplefields Investments, Bain Capital Ventures, .406 Ventures, Telstra Ventures, Poalim Capital Markets, Obvious Ventures, MTech Capital, and Hudson Structured Capital Management also participated in the round. According to Pitchbook, this round is the largest VC deal in the fast-growing cyber insurtech space, which is expected to grow to $20Bn in premiums by 2025.
Automation predictions – 1 company goes public, 2 acquired, and 2 more receive funding
Process automation is facilitated by AI and machine learning technologies. Emerging products can automate claims processing, underwriting, medical record review, and more. Of the 8 insurtech companies profiled that were designed to boost automation for insurers:
- Quantee, who offers an AI actuarial and data science solution platform that uses AI to help actuaries automate, enhance, and accelerate their processes with automated machine learning algorithms and visualizations, raised PLN 3M (~$702K) of seed funding in a deal led by Nunatak Capital in May 2022. FundingBox also participated in the round.
- Safekeep, offering AI-guided engagement and workflow tools intended to serve the financial services and insurance sectors, was acquired by CCC Intelligent Solutions (NYS: CCCS) for an undisclosed amount in February 2022.
- PolicyDock, a financial platform intended to digitize and automate insurance workflows for insurers, brokers, and agents, raised an undisclosed amount of venture funding from 1982 Ventures and StartX in February 2022.
- Doma, offering a platform powered by machine intelligence and a predictive analytics algorithm to underwrite title insurance policies instantly, acquired Capitol Investment Corp. V through a reverse merger, resulting in the combined entity trading on the NYS Stock Exchange under the ticker symbol DOMA on July 28, 2021.
- Concurrently, the company (NYS: DOMA) received $300M of development capital from SoftBank Group, Wells Capital Management, The Gores Group, Hedosophia, Spencer Rascoff, BlackRock, and Fidelity Management & Research on July 28, 2021, through a private placement.
- Monk, offering an AI-based vehicle inspection system designed to facilitate seamless integration for claim management purposes, was acquired by ACV Auctions (NAS: ACVA) for an undisclosed amount in February 2022.
Out of 8 companies profiled in Risk & Fraud, 1 was acquired and 6 received funding
Finally, powerful tools are emerging to help insurers identify and mitigate risk and fraud. Highlights from the 8 profiled companies include:
- Zeguro, offering a cyber insurance platform intended to offer a holistic cyber risk management system, was acquired by The Hartford Steam Boiler and Insurance, a subsidiary of Munich Re (ETR: MUV2), for an undisclosed amount in October 2021.
- Wenalyze, offering an open data analysis tool designed to improve risk management in the financial and insurance sector, raised EUR 1.7M (~$ 1.82M) of venture funding in a deal led by Athos Capital in March 2022. GoHub Ventures, Astorya.vc, and Bankinter also participated in the round.
- FRISS, offering fraudulence detection software intended to detect risk, eliminate fraud, and secure compliance, raised $6M of venture funding from Guidewire Software in November 2021.
- Datafolio, a developer of a data-driven mobility risk management platform designed to empower the insurance ecosystem, raised EUR 4.3M (~$4.6M) of angel funding from undisclosed investors in February 2022.
- Elpha Secure, a cyber risk intelligence and analysis platform designed to detect and mitigate threats in real-time before they happen, raised $7.5M of seed funding in the form of convertible debt from Eos Venture Partners in October 2021.
- The company also raised $1.5M in venture funding from Stone Point Ventures, AXIS Capital, State Farm Ventures on an undisclosed date. The Hartford Financial Services Group, Fermat Capital Management, and Fidelis Insurance also participated in this round.
- Riskwolf, a full-stack insurtech platform intended to provide a variety of risk management and data protection solutions, raised CHF 750,000 (~$783K) of seed funding from Astorya.vc, F10, Serpentine Ventures, and Swiss ICT Investor Club in June 2021.
- Ico-Lux, offering software designed to detect insurance fraud automatically, raised an undisclosed amount of venture funding from High-Tech Gründerfonds and Venpace in July 2021.
PE and VC firms are driving investment in this category, and flooding startups with capital. Are corporations doing enough to keep up? Venadar can help identify key growth areas and work with corporate strategy teams and CVCs to make sure they are finding the right strategic partners to invest in to make their mark on the future of the category and stay competitive.
These First View reports are generalized category analyses meant to illustrate the Venadar process. The high-level First View can identify the most promising startups in a category that are directly addressing relevant trends. What’s the next innovation trend in insurtech and where are the best emerging startups? Contact us today to see how we can create a bespoke report to directly address strategic gaps and challenges you face and identify the right partners to help you move into the future with targeted innovation efforts.
To view the full Insurtech First View report (and all other categories) visit www.venadar.com/insights