A look at investment trends to startups distributing policies or providing software for property and casualty insurance including auto, homeowners, and cyber risk.
As startups invade various lines of property & casualty insurance including auto, homeowners, and cyber, investment deal activity to startups distributing P&C policies and/or offering software and services across the P&C insurance value chain has jumped by over 4X between 2013 and 2016 year-to-date, according to CB Insights data.
This year, P&C insurance tech deals have already nearly doubled compared to full-year 2015, with growth of 92%. Two of the last three quarters have seen 30+ deals, whereas before 2016 no quarter had surpassed the 16-deal mark.
Overall funding trends
Since the start of 2012, P&C insurance tech startups have raised $2.34 billion across more than 220 deals through November 2016. This year, P&C insurance tech deals have nearly doubled, growing 92% over 2015’s total. Stripping out a $931M investment to China’s first fully-licensed online insurer Zhong An Insurance in 2015, funding to P&C insurance tech startups has risen 52% in 2016 YTD.
On a quarterly basis, P&C insurance tech deals hit their highest point since 2012 in Q1’16, when startups in the category raised $264M across 39 deals. P&C insurance tech startup deal activity has hit 30+ deals in two of the three quarters in 2016 to date.
Seed deal share hits five-year high in 2016 YTD
Almost 3/4ths of all deal activity in P&C insurance tech has taken place at the early-stage (Seed/Series A) in 2016 YTD, up from 2/3rds of activity in 2015. 55% of P&C insurance tech deal activity globally in 2016 YTD has gone to seed-stage startups. Series A activity has taken 17% of deals to P&C insurance tech startups.
Select companies that have raised early-stage funding in 2016 YTD include:
- Jetty Insurance, a homeowners and renters insurance MGA expected to launch in early 2017, raised $4M in seed funding from Ribbit Capital, Graph Ventures, Red Swan Ventures, Social Capital, SV Angel and Box Group in January 2016.
- CoverWallet, a digital commercial insurance management platform and brokerage, raised a $7.8M Series A from Union Square Ventures and Index Ventures in November 2016.
- Root Insurance, a startup providing a mobile app taking accelerometer and smartphone sensor data to gauge user driving skills and offering auto insurance as a licensed carrier in Ohio, raised $10 in Series A and debt funding from Drive Capital and Silicon Valley Bank.
- Cape Analytics, a startup providing structured aerial imagery data and analytics for property underwriting, raised $14M in Series A funding led by Formation 8.
- RiskMatch, which offers a data-driven marketplace for commercial P&C insurance, raised $3M in seed funding from Lightbank, 8VC, and Wildcat Venture Partners.
More than half of P&C insurance tech deals take place in the US
Geographically, we see that 57% of P&C insurance tech deals since 2012 have gone to US-based startups. Germany is a distant second, taking 8% of all P&C insurance tech deals over the period, and India rounds out the top 3 as a growing number of insurance aggregators including PolicyBazaar and Coverfox have accounted for 7% of deals.
Active P&C insurance tech VCs
Among investors who have made multiple bets on tech startups enabling or distributing insurance in P&C insurance, 500 Startups has invested in the most startups with investments including Embroker, Indio, and Albert. 500 Startups has also had several P&C insurance startups graduate from its accelerator program including Trym, BrightPolicy, and Inzmo. Other investors in the top 5 include Route 66 Ventures, Ribbit Capital and NEA. XL Innovate is the only corporate venture capital investor in the top 5 most active firms.
| Rank | VC Investor | Select Companies |
|---|---|---|
| 1 | 500 Startups | Albert, Indio, Embroker, Claim Di, BetterView |
| 2 | Route 66 Ventures | CoverHound, CompareAsia, Knip, Bunker |
| 3 | Ribbit Capital | PolicyBazaar, ComparaOnline, Jetty, Next Insurance |
| 3 | XL Innovate | Lemonade, Embroker, Slice Labs, Cape Analytics |
| 5 | New Enterprise Associates | Metromile, Cyence, Indio |
Largest P&C insurance tech deals: 2015 – 2016 YTD
Below are the 20 largest P&C insurance tech investment rounds since the start of 2015. The 20 deals comprised over $1.65B in aggregate funding. 18 of the 20 are focused on the selling of P&C insurance policies vs. selling into the P&C insurance industry.
| Company | Focus Area | Round | Date | Amount ($M) | Location |
|---|---|---|---|---|---|
| Zhong An Insurance | Alternative Distribution | Private Equity | 6/11/2015 | 931 | China |
| MetroMile | Alternative Distribution | Series D | 2/16/2016 | 103.1 | United States |
| Ins110.com | Alternative Distribution | Series A | 1/19/2015 | 80 | China |
| BankBazaar | Alternative Distribution | Series C | 7/2/2015 | 60 | India |
| MetroMile | Alternative Distribution | Corporate Minority | 9/21/2016 | 50 | United States |
| CompareAsiaGroup | Alternative Distribution | Series A | 4/22/2015 | 40 | Hong Kong |
| PolicyBazaar | Alternative Distribution | Series D | 4/14/2015 | 40 | India |
| Cyence | Enabling Technology for Insurers | Series A | 9/8/2016 | 40 | United States |
| CoverHound | Alternative Distribution | Series C | 9/22/2015 | 33.3 | United States |
| Huize Insurance | Alternative Distribution | Series B | 3/22/2016 | 31 | China |
| Insureon | Alternative Distribution | Growth Equity | 10/21/2015 | 31 | United States |
| Xishan Information Technology | Alternative Distribution | Series A | 7/7/2015 | 29 | China |
| FinanceFox | Alternative Distribution | Series A | 9/21/2016 | 28 | Germany |
| Trov | Alternative Distribution | Series C | 4/26/2016 | 25.5 | United States |
| CompareAsiaGroup | Alternative Distribution | Series B | 11/14/2016 | 25 | Hong Kong |
| EverQuote | Alternative Distribution | Series B | 10/20/2016 | 23 | United States |
| Samlino.dk | Alternative Distribution | Series A | 8/30/2016 | 22.45 | Denmark |
| Xishan Information Technology | Alternative Distribution | Series B | 3/26/2016 | 20 | China |
| Snapsheet | Enabling Technology for Insurers | Series C | 10/14/2016 | 20 | United States |
| Goji | Alternative Distribution | Series D | 6/28/2016 | 18.9 | United States |
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