Insurance is a moneymaker. That’s the opinion of analysts at Research and Markets, who predict that the global market will reach $1.11 billion by 2023, fueled by growth in verticals like health, property, casualty, and life insurance. Moreover, according to a recent analysis of CB Insights data by XL Innovate, over $1 billion has been invested in commercial insurance startups since 2015. And FinTech Global estimates that deals totaled $2.5 billion in the first three quarters of 2018 — an 89.8 percent increase year-over-year.
Yet another firm riding this wave is Pie Insurance, a Washington, D.C.-based workers’ compensation insurance provider that today announced it has raised $45 million in a series B funding round led by SVB Capital, with participation from Sirius Group, Greycroft, Moxley Holdings, Aspect Ventures, and Elefund. This follows an $11 million series A round in July and brings Pie’s total capital raised to $61 million.
CEO John Swigart, previously a senior executive at Esurance, says the fresh capital will be used to expand Pie’s geographic footprint and add new distribution sources. “I’m so proud of what our team has accomplished in a short period of time. We’re grateful to work with such supportive investors to take Pie to the next level and fundamentally change the way small businesses get workers’ compensation insurance,” he added. “Shopping for insurance should be simple and accessible, just like other products and services we buy online. America’s small businesses deserve a better workers’ comp insurance experience, as well as the ability to find savings in the process.”
Pie — which was founded in 2017 and operates as a managing general agency for Sirius America Insurance company — sold its first insurance policy in March 2018 and claims to have generated nearly $10 million in written premiums from the “thousands” of small businesses among its customers. It saves those customers an average of 30 percent, the company says, thanks to a proprietary analytics backend that identifies risk, prices policies, and eliminates steps from the purchase process.
Pie currently offers A.M. Best A-rated workers’ compensation insurance for up to $25,000 that covers illness or injury, disability, and death for employees of construction, restaurant, manufacturing, cleaning and janitorial, landscaping, auto repair, retail, and health care companies. Is policies are available in 19 markets across the country: Arizona, Arkansas, California, Colorado, Georgia, Iowa, Illinois, Kansas, Kentucky, Louisiana, Maryland, Michigan, Nebraska, New Mexico, New York, North Carolina, Pennsylvania, Tennessee, and Texas.
“In addition to their strong growth, Pie is producing outstanding underwriting results,” Greycroft cofounder and partner Ian Sigalow said of today’s news. “The company is positioned to make a huge impact on the small business market for commercial insurance.”