Digital Insurer Root Inc. has filed plans with the U.S. Securities and Exchange Commission for a proposed IPO.

Details of the company’s initial public offering will be fleshed out down the line. The number of shares to be offered and the price range have not yet been determined. Root intends to list its common stock on the Nasdaq Stock Market under the ticker symbol ROOT.

Root Co-Founders Alex Timm and Dan Manges

The Columbus, Ohio-based InsurTech has been a rumored IPO candidate for months. Root has raised a total of $523 million in venture capital to date, including a massive $350 million venture capital round nailed down in September 2019. Its money resources include an additional $100 million in debt financing.

Root said that last venture capital round, led by DST Global and Coatue, raised its valuation to $3.65 billion.

Root launched in 2015, billing itself as the nation’s first licensed insurance carrier that functions entirely through mobile use. After initially selling digital auto insurance, it has since expanded into the renters and home insurance market. Root’s technology operates through a mobile app that uses smartphone technology, telematics and data science. Root is currently available in 29 states.

At the end of 2019, Root reported a net loss of $282.4 million, up from a $69 million net loss in 2018, according to its IPO filing. Those losses grew as the company ramped up its expansion. The startup booked $40.2 million in net premiums earned in 2018, which grew to $275.3 million in net premiums earned in 2019. Root’s IPO filing explained that the growth in premiums came from “significant growth in policies in force during the year, driven by expansion into seven new states and the addition of new product offerings.”

In April, Root agreed to purchase a shell insurance company, the filing notes. It expects to close the acquisition later in 2020 and use it to expand its ability to sell personal auto insurance in 48 states and the District of Columbia.

Root has been fleshing out its employee roster and executive team for months, most recently in September with the hiring of former Tennessee insurance commissioner Julie Mix McPeak as its deputy general counsel.

Other InsurTechs Eye IPOs

In eyeing an IPO, Root joins other technology-focused insurance providers going public.

Lemonade, a home, renters and pet insurance provider backed by SoftBank Group Corp. that has also been unprofitable since its inception in 2015, raised more than $300 million in its IPO this summer.

Home insurer Hippo Enterprises Inc. in July closed a $150 million financing round. The Palo Alto, Calif.-based startup, which was valued at about $1 billion in a funding round last year, is preparing for a potential initial public offering, Chief Executive Officer Assaf Wand has said.

In May, shares of SelectQuote Inc. jumped more than 40 percent in its stock market debut, giving the insurance policy comparison website a market valuation of over $4 billion.

InsurTech watchers expect Next Insurance could be next. This small commercial lines insurer has raised $631 million, more venture capital money than Lemonade did before it went public.

As for Root, Goldman Sachs & Co., Morgan Stanley, Barclays and Wells Fargo Securities will act as lead bookrunners for the proposed offering. Credit Suisse, Deutsche Bank Securities, Evercore ISI and Truist Securities will act as additional book runners, and Cantor Fitzgerald & Co., JMP Securities and Siebert Williams Shank will act as co-managers of the proposed offering.

The proposed offering will be made only by means of a prospectus.

Source: Root

*A version of this story ran previously in our sister publication Insurance Journal.