New risks, new innovation. New funding, new insolvencies

Hello.

You’ve got this…
“Onto has suffered from the steep fall in electric vehicle residual value in the first half of 2023, rising interest rates and the squeeze on disposable income and was unable to secure additional funding from its shareholders.” – Gavin Maher, joint administrator.

And you’ve got this…
“Because we’re already profitable and well-funded, we didn’t need to raise right now, but the additional funding strengthens our liquidity position and can be used to fuel more growth. Also, we were able to raise without too much effort, at the same share price, while so many other technology companies are having trouble securing capital.” – Sean Harper, CEO of Kin.

My summary of 2023 so far:
Tough times for some.
Good times for others.

We’ll come on to Onto and Kin a little later.

First a call to any non-Sønr clients, based in the US.
We’ve two remaining places for companies wishing to join the Sønr Insiders – North America program running in Q4 2023.

What this looks like for you and your colleagues is:

Access to unparalleled global innovation data
Deep intelligence on companies with a direct insurance proposition and those that may have material impact for insurers
24-hour support from our analyst team to answer any question on any of the companies or trends
A toolset that enables your teams to share knowledge, track activity and work together

If you’d like to experience, first hand, why companies such as Liberty Mutual, Travelers, RGA, Tokio Marine and so many others use Sønr, drop me a line.

New risks, new innovation

Earlier this year I was on stage at ITC Barcelona interviewing Amélie Breitburd, CEO of Lloyd’s Europe. We talked a lot about new and emerging risks, and critically, the need for innovation to enable insurers to respond to these risks.

The good news is I’ve a host of interesting plays to share this week.

Civil unrest – this one I found particularly fascinating. Verisk Maplecroft, the risk intelligence business arm of Verisk, has launched a new predictive strikes, riots, and civil commotion (SRCC) data model.

Designed for political violence underwriters, exposure analysts and specialty reinsurers, as part of the Lloyd’s Lab accelerator programme, Verisk Maplecroft’s new SRCC Predictive Model offers insurers an entirely new approach to how they assess and price these risks. With thousands of locations around the world having the potential for damaging civil unrest events to emerge, it’s unlike anything currently available to the market.

Earthquakes – alright, so maybe not a risk as such but a nice bit of innovation nevertheless. Liberty Mutual Reinsurance, MGA XS Global and technology provider Safehub have announced the launch of the world’s first sensor-based, parametric reinsurance treaty for earthquake risk.

Insurers can use the smartphone-sized sensors, placed in individual properties, to accurately measure the shaking at the site, thus minimising basis risk and providing faster pay-outs.

Tornados – this one seemed to get a fair bit of press. Beazley, Sola Technologies and Spinnaker Insurance Company have come together to provide homeowners the first admitted parametric tornado disaster benefit insurance.

The policy limit ($15,000) is intended to cover the deductible and immediate expenses.

The coverage can supplement a comprehensive homeowner or renter policy and is currently available in 15 US states in the Midwest and Southeast, with more expected to come online soon.

Renewable energy – with a global shift towards green energy, the next 10 years will witness exponential growth in the offshore wind industry, which is expected to be a $1 trillion industry by 2040.

Interestingly however, offshore wind in particular is currently experiencing ‘capacity crunch’ as insurers are finding these large assets too uncertain to insure or price accurately.

And that’s where Renew Risk comes in – a London-based, clean-energy risk analytics SaaS which has just raised £1.7m to improve the financing, planning and insurance for renewable energy assets.

Carbon removal – Opna, the company previously called SALT, has just raised a $6.5m Seed round.

Opna enables companies to finance prospective carbon removal projects, rather than buying credits from them once they’ve been set up. The aim is to enable more project developers to set up carbon projects.

And finally from funding to acquisitions, Swiss-based CelsiusPro has acquired UK’s Global Parametrics.

The combined offering is set to benefit clients in sectors including property, agribusiness, re/insurance, microinsurance, nature-based solutions, and international development.

Pulling the plug on Onto

This one really took me by surprise. Admittedly I hadn’t being paying huge attention to the business or its metrics recently.

Having raised over $300m to date and reporting 500% growth last year, it appears the heady combination of rising interest rates and depleted consumer spend has meant the administrators are now doing their thing.

Founded in 2017, I really liked Onto’s proposition – access to electric cars, without long-term obligations. Through a monthly all-inclusive subscription, customers can get an EV including insurance, public charging, and maintenance.

Sadly it is no more.

Jump the Atlantic though and it appears Roam has a model that is working.

Onlia, a digital insurance provider in Ontario, and Roam, a broader (ie not just EVs) car subscription service, have joined forces. Their collaboration will offer personalised insurance rates based on a pay-as-you-go option for car use, encompassing insurance, maintenance, roadside assistance, and more. Nice. I wish them all the luck in the world.

Life, health and innovation for those who don’t have either

I was pleased to see YuLife offering health insurance for employers through a partnership with Bupa. I like this for both companies and great to see open innovation plays like this.

The collaboration doesn’t only provide insurance coverage; it actively encourages users to adopt healthier daily habits, positively impacting their wellbeing. Nice.

Another partnership I liked is Sureify and FreeWill coming together.

The former is a provider of digital distribution and service-related solutions to the life insurance industry, and the latter, an estate planning platform. The partnership will enable major life insurers to provide estate planning benefits to their clients and prospects.

Simple but super valuable.

And tying in with this, kinda, Alix – a startup offering estate settlement services, has raised a $5.5m Seed.

The US company, founded just last year, is looking to automate, simplify and streamline the estate settlement journey. And my goodness does it need it. Their solution combines AI and a real-life human being to guide people through the estate settlement process.

Who said innovation was all about Horizon 3?

One thing we’re definitely seeing more of is enablement tech. And what I mean by this is technology focussed on the near-term transformation of incumbents.

A few examples:

Core platform – Inari, a core technology infrastructure provider for the global insurance and reinsurance industry, has raised a $5.2m Seed round.

With the new money, the plan is to venture into new geographies and build more features based on its ‘best-in-class technology’.

Risk management – Certa, an enterprise-focused compliance, governance and risk management platform has raised a $35m Series B.

It’s recently launched a couple of interesting things:

An ESG suite to help companies with supply chain-related requirements
A no-code ‘studio’ that allows users to personalise risk-exposed business processes through a drag-and-drop interface

Worth checking out, for sure.

Pricing capability – Akur8 has closed a new funding round of $25m. This latest round included a new investor, FinTLV.

Akur8 is doing some pretty smart things in and around insurance pricing using Transparent Machine Learning. From boosting insurers’ pricing capabilities ‘with unprecedented speed and accuracy’ to reducing bias during the modelling process – checking these guys out is a must.

User interaction – Context.ai launched earlier this year to help companies better understand how users are interacting with their LLMs.

This week the company announced a $3.5m Seed investment to fully develop the idea.

The way it works is customers share chat transcripts with Context via an API. Using NLP, the software groups and tags conversations based on topic, and analyses each conversation to determine whether the customer was satisfied with the response.

And finally some news from around the world which I couldn’t find a better home for 🤷

Private debt and asset marketplace

These guys are interesting – Tradeteq.

They run a marketplace for private debt and real assets and this week announced a $12.5m A Plus round, led by MS&AD Ventures.

Launched in 2018, their platform allows banks to securitise and distribute their trade finance assets to investors. And earlier this year they pushed out further, covering private credit.

And why this is interesting? It now makes it easier for banks and alternative lenders to connect, interact and transact with institutional investors, such as pension funds and insurance companies. Nice.

Insurtech UK names its first CEO

Great to see Melissa Collett has taken the reigns of Insurtech UK as it seeks to position the UK as a global hub for innovation in the insurance technology sector.

Collett’s role will also involve fostering the growth of Insurtech UK’s membership base, currently comprising over 100 companies, including 100 insurtechs and 30 partners from both the traditional insurance sector and related industries serving the insurance market.

Kin raising more funds. Because it can

And so, to wrap up by completing the opening story.

Home insurance startup Kin Insurance has announced a $33m Series D extension.

These guys are now live in 7 states and on pace to deliver $370+ million in total premium in 2023. Not bad at all, especially in this current climate.

Building on the earlier quote from CEO Sean Harper, he also said:
“Investors are putting a premium on growth in the context of profitability, and we’re growing exceptionally fast because we’re able to profitably serve customers who aren’t being well served by incumbents.”

Bold. Love it.

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Right, it’s time to call it a day.

Remember if you’re based in the US and think your company might get value from a 1-month PoC with Sønr, get in touch. As I say, we’re down to the last two available spots.

Have good weekends.

Matt

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