Gabi has raised $9.5 million in a first institutional round of funding to make sure you get the best rates when it comes to car, homeowner’s, or renter’s insurance.
The San Francisco company automates insurance shopping and provides more visibility into insurance rates, allowing people to compare all the major insurance companies’ rates and instantly get a quote. And it does so without forcing you to go to multiple web sites and fill out a bunch of forms.
“We estimate roughly $50 billion are overpaid by insurance customers in the U.S. every year, and we’d like to put some of that money back into our customers’ pockets,” said Gabi CEO Hanno Fichtner, in a statement. “Instead of relying on insurance agents who may be biased or conduct incomplete research, Gabi’s technology automatically scours the 25 largest insurance companies in the US, including Allstate, Travelers, and Safeco, for the best rates and most relevant offerings.”
Canvas Ventures led the funding, with participation from Correlation Ventures, Northwestern Mutual Future Ventures, and Securian Ventures, as well as prior investors A.Capital Ventures and Project A. To date, the company has raised $12 million.
Gabi is based in San Francisco, with an engineering team in Lodz, Poland. The company plans to use the money to expand nationally.
The company removes bias from quotes by deriving them using technology rather than insurance agents focused on commissions, Fichtner said. Gabi hopes to save customers about $460 a year, said Gabi chief product officer Krzysztof Kujawa. I used it on my own family’s insurance, and Gabi estimated I could save $828 a year.
Gabi’s technology reviews and compares people’s current insurance rates to major insurers’ rates, then finds the right coverage at the best rate possible. At sign-up, customers link their car and home insurance accounts or send their policies to Gabi. Gabi then analyzes their current coverage and compares the rate with those of major insurance companies to find a better price for the same coverage. By scanning existing insurance documents to create an insurance profile for each customer, Gabi saves the customer the tedious step of entering all the information by hand.
The Gabi algorithm has already found savings of more than $460 per year on average for more than 60 percent of its customers. After the initial comparison at signup, Gabi keeps checking for better offers and functions as a digital insurance folder. If the customer moves or buys a new car, Gabi adjusts.
Over time, the company will review auto, home, renter’s, umbrella, and life insurance. The focus for now is in the U.S. The team has 20 employees, and it was founded in 2016 by Fichtner, Kujawa, Vincenz Klemm, and Pawel Olszewski. The company started offering car and home insurance in California in 2017.
The company isn’t doing health insurance now, as it is often provided by employers and it is hard to switch policies. According to Princeton Survey Research Associates International, 62 percent of insurance customers believe insurance shopping is too time consuming. The study also found one in three drivers (36 percent) never shops around for auto insurance quotes.
That, according to Gabi, is unfortunate because shopping around often reaps savings of hundreds of dollars a year per customer. Now the company offers insurance in Ohio, Texas, North Carolina, Pennsylvania, and Arizona. Gabi currently offers insurance for auto, home, renter’s, umbrella, and life.
Unlike insurance brokers, Gabi offers customers a service agent to speak with if desired, or they can interact only with the app. If customers choose to switch insurers, they are not required to repeatedly fill out long insurance forms, and they are not spammed with unwanted calls or emails.
“We think the market for Gabi’s unique insurance-shopping technology is sizable,” said Rebecca Lynn, general partner at Canvas Ventures, in a statement. “We also think the technology can be tailored over time for a range of insurance products.”
Lynn will join Gabi’s board of directors. The company said the fastest-growing demographic for its service is the 35-55 age group. In addition to working with long-established insurance companies, Gabi recently formed a partnership with Clearcover, a new “online-first” auto insurance company that is backed by American Family Insurance.