4 U.S. based unicorn companies transforming insurance

By Pavithra R

A unicorn startup or unicorn company is a private company valued at over $1 billion. The term was coined in 2013 by venture capitalist Aileen Lee, choosing the mythical animal to represent the statistical rarity of such successful ventures.

Insurtech refers to the use of technology innovations to squeeze out savings and efficiency from the current insurance industry model. Given the ever-growing capitalization of the market, the U.S. InsurTech industry is the biggest one in the world. Here is a list of 4 United States-based unicorn companies transforming insurance.

Lemonade (2015)

Lemonade Insurance Company is a licensed insurance carrier, offering homeowners and renters insurance powered by artificial intelligence and behavioral economics. InsurTech operates under a flat-fee model and is replacing brokers and bureaucracy with bots and machine learning. It promises zero paperwork and instant everything. The firm recently partnered with Nexsys to simplify the homeowners’ insurance verification process.

Next Insurance (2016)

Next Insurance is transforming small business insurance with simple, digital and affordable coverage tailored to the self-employed. The company’s technology-first approach drives down costs by up to 30 percent when compared to traditional policies.

The InsurTech is looking to leverage the opportunity to use technology to transform the small business insurance experience in the U.S. and emerge as a national insurance leader. The company recently secured $250 million in Series D financing led by CapitalG which raised the company’s valuation to more than $2 billion. 

Oscar Health (2012)

New York-based Oscar Health is a direct-to-consumer health insurer, pairing member engagement with its own full-stack technology. The InsurTech’s team is focused on utilizing technology, design and data to humanize health care. The firm has raised $1.5 billion in funding to date and is at a valuation of $3.2 billion. Oscar’s all products and services are provided exclusively by or through operating subsidiaries of Mulberry Health Inc., including Oscar Insurance Company and its affiliates.

Hippo (2015)

Hippo Insurance Services is on a mission to transform home insurance for the modern household. The firm offers accurate and affordable coverage by using technology and data integrations to develop a unique profile of a customer’s property during the onboarding process. It actively reviews changes to a customer’s property over time, using thermal and satellite imagery and layers in AI, machine learning and public records to keep customers’ properties protected, year after year. The company’s home insurance policy comes with a complimentary smart home monitoring system and a discount on the user’s premium for protecting the home against common risks like fire, water damage, and theft.

Hippo began selling its policies to homeowners in 2017 and is now available to more than 70% of the U.S. homeowners population across 29 states. Recently, The InsurTech raised $150 mn in Series E funding bringing its valuation to $1.5 bn. In June 2020, the firm has also acquired Spinnaker Insurance to enhance its global reach.