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Next Insurance, based in Kfar Saba, raised $ 83 million as part of a B round of financing, bringing the total funds raised by the company to $ 131 million. Next Insurance, an insurance-based insurance company for small and medium-sized businesses in the United States, was founded by CEO Guy Goldstein, CTO Alon Huri, and R & D Vice President Nissim Tapiro. The company, which initially operated in the United States as an insurer and sold the policies of other insurance companies, itself became an insurance company in seven different US states and intended to obtain a license for the other 43 US states within two years.
Before founding Next Insurance, Goldstein, Huri and Tapiro founded Check, which developed an application to monitor users' bank accounts. Check was sold to the US company Intuit in 2014 for $ 360 million in cash and the three men founded Next Insurance shortly thereafter. Huri told the "Globes" that their reputation helped them raise large amounts of capital at an early stage.
Redpoint Ventures led the current round of Next Insurance with the participation of the company's existing investors, including Nationwide Insurance, Ribbit Capital and American Express Ventures. Re, and three Israeli investors: TLV Partners, SGVC (controlled by its managing partner Dovi Frances) and Zeev Ventures (controlled by its founding partner Oren Zeev). The company currently has 60 employees, including 30 in Israel. Huri says they plan to triple the number of employees over the coming year.
"Today, No Business Dominates the Market"
The Small Business Insurance Market in the United States Is Estimated at Over 100 Billion Dollars . Unlike home and auto insurance, which includes 5-10 types of insurance, insurance for small businesses covers thousands of types of businesses and, as a result, thousands of types of insurance. Existing insurance companies sell standardized general policies at a fixed price, which is not suited to the particular needs of businesses and the self-employed and does not cover the risks to which they are exposed. For example, a photographer needs a cover for the camera equipment, while a repairman will prefer to cover his car. Each of them is exposed to different risks that are expressed at a different price.
Next Insurance, specializing in small and medium-sized businesses, issues policies tailored to each type of business. Huri explains that in this way, the company can offer relevant coverage and a lower price than its competitors. In the United States, we are talking about a $ 135 billion a year market, one of the interesting things in the world of insurance for small businesses, is that it is very difficult to enter because there are thousands of types of professions. No company dominates the market, the largest company has a 5% market share, and we now sell policies for tens of millions of dollars a year. "
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" We Do not Work With Insurance Agents "
Next Insurance has no branches or agencies; it offers insurance online. It also develops artificial intelligence and big data technologies and begins to use them to detect fraud.
"The great insurtech business revolution is that they make insurance accessible to the customer," says Huri. "The current process is inefficient and does not benefit the customer in two ways: agents want to sell more insurance policies, even if the policies are not suitable for customers, and insurance companies want to pay less of claims. "
principle, we do not work with all these agents. An insurance agent gets an 8-15% commission on the insurance that he sells, so selling online allows us to save a lot of money. We use technologies that conventional insurance companies do not use for the moment. As soon as the process happens online, there are many variables that allow us to better calculate the risk. "
" Globes ": Would not you prefer to pay fewer clients filing claims under their policies?
Huri: Insurance is designed for people who really need it and when they need it. We check how fast we pay a customer who files a claim in comparison with other companies. Unlike other companies, we do not try to optimize the process so that we do not pay the customer for a claim. We want to pay honest customers. There is, of course, insurance fraud and we have the tools to deal with it.
Posted by Globes [online] Israel Economic News – www.globes-online.com – on July 12, 2018
© Copyright of Globes Publisher Itonut (1983) Ltd. 2018
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