8 World-Changing Automotive Insurtech Scaleups in the US
Two industries that have a lot in common, and continuing to converge in the current uncertain worldwide scenario. Let’s have a look.
It is obvious today that while we talk about automotive and insurance, we need to take into account two very specific factors impacting US, Silicon Valley and the industry as a whole that a year ago couldn’t be predicted:
- Covid-19 and the current pandemic;
- California wildfires.
In regards to the pandemic, there’s been tremendous change in consumer behavior, especially when it comes to transportation and mobility (stay on the lookout, our full Mobility article will come in the next few weeks). Listening to the news on TV and socials you can glimpse the inability to provide mobility from Public Transportation, at least until now. Some changes happened in recent weeks where the PAs from different areas of the country decided to reopen and find a way for people to get access to public transportation, though still not as widely used as before. While speaking with a friend of mine, an executive in the automotive industry, I discovered some of my early ideas around this were right; the automotive industry got a big hit at the beginning of the year that’s now going back–and possibly the pandemic could turn it into a good positive flow for the industry globally.
Today more than ever people are in need of personal vehicles rather than “old-fashioned” mobility on-demand. This being due to the inability to track whether or not the previous user of the vehicle carried the virus, wondering “is this the safest mode of transportation?” I have done more research on this and according to a BCG study, as of May 15, 2020 the pandemic stimulated a changing behavior for all of us as consumers of transportation, in exchange of a the safest option, for the time being.
In the insurance world, we have witnessed an unprecedented change, and it’s entirely possible for insurers to disrupt the conventional schemes. During a survey run by PwC experts in Q1, interviews with insurers’ CEOs found that 70% of them will prioritise or invest in customer experience by March 2021. At the center of the customers expectations resides sustainability, without missing in the basic aspects (operations, and reliability).
According to PwC survey, “Focusing on sustainability is an opportunity to demonstrate the value of insurance and strengthen public credibility, but it’s only achievable if businesses act with care and integrity in all other aspects of their operations.”
When it comes to sustainability, it is vital that we put into picture the wildfires in California and the climate change discussion. These factors are making many consumers all over the world (due to media coverage of such events) concerned whether they should evaluate a more sustainable option or maintain a “lazier” approach, like sticking with the old way of doing things.
Having said that, in California and in Silicon Valley, companies seem to be placing attention on the first side of the coin—sustainable options.
Below you’ll read through a list of our favorite startups active in automotive and insurance, solely in the US market. The concentration of energy and sustainability-focused companies is astonishing. It seems after all that EV technology is still leading the way over autonomous driving. Though these worlds can certainly and will overlap, investors appear more interested in providing support to sustainable endeavors in the short term (see the investments deployed to each company below).
Don’t get us wrong, we also saw what happened with Zoox and Amazon. But today consumers’ concerns seem to be leaning towards the electric and sustainable way of moving, not necessarily autonomously.
Our 8 favorite Automotive Insurtech Scaleups in the US:
Volta Charging
HQ: San Francisco, CA
Founded: Feb 10, 2010
Funding: $153.8M
Volta Charging is a marketing and advertising company that designs, installs, and maintains a network of electric vehicle charging stations.
What’s the Value:
Volta Charging has turned passive and boring charging stations into outdoor digital advertising panels. Not just that, doing so they were able to provide free energy, thanks for the advertising, to EV owners. To date they’ve provided 75.3M free electric miles and of course, still counting every day.
Worth Mentioning:
Volta partnered with EverCharge to reduce station-related infrastructure costs
How Electric Carmakers Make Billions from Fuel-Burning Competitors
Chargepoint
HQ: San Francisco Bay Area
Founded: 2007
Funding: $659.2M
ChargePoint develops and manufactures technology for their network of electrical vehicle charging stations.
What’s the Value:
ChargePoint provides the world’s leading EV charging network. The word sustainability for them is front and center. They committed at the Global Climate Action Summit (run by Jerry Brown in 2018) to deploy 2.5M charging spots by 2025.
Worth Mentioning:
Fair
HQ: Los Angeles, CA
Founded: 2016
Funding: $2.1B
Fair is a car leasing company that is revolutionizing the car-as-a-service concept.
What’s the Value:
Fair has disrupted the way people lease their vehicles. Since 2016 they have raised 2.1B dollars from investors like SoftBank, Munich Re, BMW iVentures, Sherpa Capital.
Worth Mentioning:
- 3.5 million users have downloaded the Fair app
Hippo Insurance
HQ: Palo Alto, CA
Founded: Jan 1, 2015
Funding: $359M
Hippo Insurance is an insurtech company that provides home insurance products by taking a tech-driven approach.
What’s the Value:
Hippo has disrupted the home insurance industry. Its business is valued at $1.5B post-financing after the latest round of $150M series E with a YoY growth of 140%. Hippo offers homeowner’s insurance that covers the homes and possessions of the insurance holder as well as liability from accidents happening in the insured property. They use AI and big data to aggregate and analyze property information. The company sells insurance policies directly to customers and through independent insurance brokers.
Worth Mentioning:
Nauto
HQ: Palo Alto, CA
Founded: Mar 3, 2015
Funding: $173.9M
Nauto is an AI-technology company on a mission to make driving safer and smarter.
What’s the Value:
Nauto is the only real-time, AI-enabled driver and fleet safety platform to predict, actively prevent, and reduce high-risk events in the mobility ecosystem. By analyzing billions of data points from over 800 million AI-analyzed video miles, Nauto’s machine learning algorithms continuously improve and impact driver behavior before events happen, not after. Nauto has enabled the largest commercial fleets in the world to avoid more than 45,000 collisions, resulting in nearly $200 million in savings. Its growth and speed is at the pace of Silicon Valley fellow organizations. Raised mainly 2 substantial rounds and worked through it since the last round in 2017.
Worth Mentioning:
Metromile
HQ: San Francisco
Founded: Jan 19, 2011
Funding: $293M
Metromile is a car insurance company using data science and machine learning to offer drivers new and fairer insurance.
What’s the Value:
Pay-per-mile insurance is a type of usage-based insurance where the user pays a base rate along with a fixed rate per mile. The billing model is intended to benefit low-mileage drivers and does not take driving style or behavior into account (for determining rates or discounts). To measure mileage, the Metromile Pulse device is plugged into the onboard diagnostic (OBD-II) port of the car. The OBD-II port is the same port that mechanics use to diagnose issues that trigger a car’s “check engine” light. The device then transmits mileage data to servers. Metromile provides a full customer service team and 24/7 claims team. Metromile began underwriting its own policies in September 2016.
Worth Mentioning:
KeepTruckin
HQ: San Francisco, CA
Founded: 2013
Funding: $227.3M
KeepTruckin is a San Francisco-based startup helping trucking companies manage their fleets and have their drivers legally log their hours.
What’s the Value:
KeepTruckin is trusted by over 100,000 fleets for compliance, fuel tax reporting, GPS tracking, video monitoring, and much more. The US Department of Transportation has mandated the use of ELD by all truck drivers so the KeepTruckin platform was built from the ground up for the ELD mandate requirements. With the #1 rated Vehicle Gateway, KeepTruckin has built the largest network of connected trucks in the world.
Worth Mentioning:
ClearCover
HQ: Chicago, IL
Founded: 2016
Funding: $104.5M
Clearcover is a digital car insurance provider offering better coverage for less money.
What’s the Value:
ClearCover taps an AI tool trained on millions of data points to match vehicle owners with affordable insurance policies, and to expedite the claims-filing process with instant disbursements for repairs necessitated by accident-related damage.
Worth Mentioning:
Final Conclusions
From our side, we will keep looking for the most interesting innovators around the globe that can support our clients’ efforts in automotive and insurtech.
Send me an email, if you are
- a startup and interested in being a part of our next top 5 articles or interested in taking part in our activities
- a corporation interested in innovation!
Stay tuned for our next Scaleup Summits:
- Scaleup Summit Silicon Valley – September 30 – October 1, 2020
- Scaleup Summit Europe (Paris) + Corporate Startup Stars Award – December 2020
*sources: Crunchbase, BCG, PWC: https://www.pwc.com/gx/en/ceo-agenda/ceosurvey/2020/trends/insurance.html#:~:text=The%20industry%20has%20increased%20its,intuitive%20and%20more%20user%2Dfriendly.