Next Insurance raised $83 million in a new financing round, money it said will fuel its continued U.S. expansion as a full-service digital insurance carrier focused on the small business market.
“Our goal is to become the one-stop shop for all small business insurance needs, no matter where they are,” CEO and co-founder Guy Goldstein said in prepared remarks.
Nationwide Insurance and Munich Re participated in the Series B round, along with American Express Ventures, Ribbit Capital, TLV Ventures and Zeev Ventures. Redpoint Ventures led the financing; Managing Director Elliot Geidt will join the Next Insurance board.
Combined with the new financing, Next Insurance has raised $131 million since its launch two years ago.
The company touts its approach as a way to boost innovation in the small business insurance market through newer ideas such as on-demand coverage, more sophisticated uses of AI and machine learning for underwriting. There is also easier policy language, customized coverage, and the company said claims will be paid within 48 hours.
Next Insurance said the new financing will help it, in part, add additional lines of insurance. The California-based startup debuted initially as a digital insurance agency for small to midsize businesses. In May, Next Insurance announced its new status as a licensed insurance carrier, beginning with Delaware. Since then, it has become a licensed carrier in Oklahoma, Arizona, North Carolina, Texas, New Mexico, Maryland and Utah, and the company said it is rapidly expanding to all 50 states.
Next Insurance is among a number of new property/casualty startups such as Lemonade, Root and Metromile, all of which are pledging to disrupt the industry with greater ease, efficiency, broader use of technology and better costs. Those companies all had combined ratios well above 100 last year, however. With that in mind, Goldstein told Carrier Management back in May that Next Insurance had taken steps to provide for stable, positive growth.
“We are building a sustainable company that’s focused on long-term success,” Goldstein noted at the time. “We know that in order to do that, we have to maintain our target loss ratio. That’s why we are investing in our rating and underwriting and using data science in innovative ways that have never been done before in the small business insurance market.”
Source: Next Insurance