The insurance space which many claim as being quite unremarkable over the past few years, is now witnessing a huge shift thanks to the introduction of technology into insurance. With a helping hand from venture capitalists and the ability to leverage technology, insurance technology (insurtech) startups have profited greatly. They have created a consumer-friendly and efficient atmosphere which the industry old companies still fail to provide; especially in the Health Insurance sector.
Right now one of the hottest companies in the insurtech space is Bright Health – an insurance startup that provides affordable individual, family, and Medicare Advantage healthcare plans. The company has now raised $200 million in a series C and has amassed a total of $440 million since early 2016. Pitchbook currently values the company at $950 million; over double the valuation it garnered in 2017 ($400 million). The company initially expected to raise about $150 million. The funding round drew in two new investors – Declaration Partners Meritech Capital Partners leading to an oversubscribed Series C funding.
The Minneapolis-based company was started off by a trio of former United Health executives – Bob Sheehy, Kyle Rolfing, and Tom Valdivia. The company got popular with their Care Partner Health Plan. Under which Bright Insurance partners with just a single healthcare provider which has a strong presence in the market. It also offers a lower premium and boasts of a consumer-friendly technology platform that includes web tools and a mobile app for finding care, as well as a health rewards program.
The company currently only operates in Alabama, Arizona, Colorado, New York City, Ohio, and Tennessee. With these fundings, the company expects to triple its geographical locations by 2019 and expand into new markets. “Bright Health has continued to execute at a fast pace towards our goal of disrupting the old health care model that places insurers at odds with providers. Its current high re-enrollment rate shows that consumers are ready for this improved healthcare experience – especially when it is priced competitively,” said Bob Sheeshy in a press release.
Other insuretech companies have also witnessed a sudden influx of cash. Oscar Health, valued at $3 billion raised $540 million across two deals. Devon Health and Hippo, have raised $ 300 million and $ 109 million respectively. An app-based car insurance company – Root Insurance which is valued at $ 1 billion raised $ 100 million in Series D funding.