Pie Insurance, an InsurTech startup focused on the small business workers compensation market, recently closed a $4.3 million seed financing round and the company is debuting this week with an online price-compare tool.
Plans call for Pie to handle full-scale insurance starting in Spring 2018.
Investors involved in the round include Sirius Group, a global specialty insurer and reinsurer; Moxley Holdings, a venture capital firm; and Elefund, an early-stage venture capital firm with a FinTech investment focus. Pie’s founders made the official launch announcement at InsureTech Connect in Las Vegas.
“The traditional high-touch approach agents and underwriters use in commercial lines leads to high prices and a protracted customer experience. Yet, the profitability in this sector indicates that small accounts are subsidizing larger accounts at most insurance companies,” Pie co-founder and CEO John Swigart said in prepared remarks. “By focusing exclusively on small businesses with a digitally enabled solution, Pie will solve this problem at scale.”
Swigart, who helped lead Esurance’s rapid growth before it was sold to Allstate in 2011 for $1 billion, said he sees the small business market as being “often overcharged and underserved when it comes to meeting their commercial insurance needs.”
Pie’s first product will be the Pie Price Predictor tool (on its web site – www.pieinsurance.com) which is designed to help educate small businesses on what they should be paying for workers compensation policies versus the market average, a spokesman explained. Valen Analytics will be powering the tool, with information based on an analysis of $28 billion in premium from its data consortium, combined with Pie’s proprietary pricing altorithms. (Valen CEO Dax Craig is on the Pie Insurance board of directors.)
Businesses can use the tool at no charge. But the long-term plan is for Pie to be an insurance company that will quote and bind insurance policies for small businesses, based on data from the predictor tool. Pie Insurance will be a full-service Managing General Agent, handling everything from quotes to claims, and backed by Sirius. A spokesman said Pie would operate essentially like a carrier.
Plans call for starting to issue actual insurance policies by Spring 2018, beginning in Illinois. Over time, Pie Insurance will be based in more than 40 states as regulatory approval comes through.
Pie Systems Architect Brian Buvinghausen is also an Esurance veteran, and User Experience executive Kevin Philpott worked at GEICO, according to the company’s web site. Marcia Benshoof, Pie’s Workers Compensation Insurance Leader, was an executive at Pinnacol Assurance.
Source: Pie Insurance