With ambitions to challenge insurance giants like Allianz SE, newcomer Deutsche Familienversicherung AG needs 100 million euros ($116 million) in fresh funds to finance its expansion plan. An initial public offering is one path Stefan Knoll, founder and chief executive officer, is considering.

“There’s an opportunity to grow even more in the next three to five years, before the current economic cycle weakens and things get a bit more difficult,” Knoll said in an interview. “We’re looking at multiple options, including an IPO, and are aiming for a solution by the end of the year.”

Knoll wants to use the money to bolster sales and marketing efforts as he seeks to double the number of customers to one million by 2019.

With just 72 million euros in 2017 sales, DFV—which focuses only on health, property and casualty insurance—is still a niche player compared with the 31.7 billion euros revenue Allianz, Europe’s biggest insurer, reported for those segments last year.

DFV uses artificial intelligence to decide which insurance claims are legitimate and which are not. In partnership with Frankfurt-based startup Minds Medical GmbH, it developed an algorithm that can read so-called ICD-10-Codes, used by doctors and hospitals to categorize their bills.

Humans only get involved when a dispute arises, and the tool has the capacity to learn from human decisions to further improve the automation. The technology also helps the company keep costs in check, holding staff numbers at a minimum even as customer numbers surge.

Knoll has considered selling to a bigger partner in the past, but takeover talks failed to produce a transaction as the parties couldn’t agree on strategy. He believes that DFV is better off on its own, rather than being part of an established insurance company.

In his view, these lack the will to radically change their business model to give digitization the prominence he believes it should have. Knoll declined to reveal the companies DFV has held discussions with.

Topics Carriers Tech Allianz Germany