Aussie InsurTech Honey Insurance secured AU$15.5m (about $11.9m) in seed funding, the largest seed round in Australian history for a technology company.
Investors include ZIP CEO and founder Larry Diamond, Airtasker CEO Tim Fung, Afterpay CEO Anthony Eisen, Corelogic ex-CEO Graham Mirabito, former CEO of News Corp Australia and Foxtel Peter Tonagh, among others.
The seed round also had institutional investors including RACQ, PEXA, Metricon, ABN Group, Mirvac, AGL, SFG, REI and Apex Capital.
The funding will be used to rapidly scale their team, adding a further 80 people over the next 12 months. Honey Insurance will also invest heavily in research and development.
Led by serial entrepreneur Richard Joffe, the co-founder and CEO of Park Assist and Stella.ai in the US, Honey Insurance aims to capitalise on the fact that customer service from incumbent players was poor and that policies had not kept up with the advent of technology.
It gives customers an allocation of smart home sensors and rewards the customer with lower premiums from day one. This reduced premium is based on the view these sensors will keep their homes safer by helping monitor for avoidable mishaps like fire, water leaks or intrusion.
Customers get AU$250 worth of smart sensors to monitor for the top three risks to homes – flooding, fire and theft. The sensors look for things like leaky water pipes, smoke and open garage doors. Half of the insurance claims are avoidable and the sensors help prevent incidents. As an incentive, Honey Insurance customers get 8% off their premiums if their sensors are switched on.
Customers can purchase insurance in as little as three minutes and over the long-term, Honey Insurance will also use publicly available information and satellite data to automatically update policies if a customer makes changes to their home.
Honey Insurance counts a number of executives from the technology and insurance sectors as part of its team, including Joel Tow, former VP of Engineering at Airtasker; Simon Farrugia, former Director of Product at Campaign Monitor and Domain; Angelo Azar, former Head of Operations at Hollard Insurance and Eoghan Trehy, Chairman of Insurtech Australia.
Joffe said, “We use smart data to simplify a process that’s currently far too confusing than it needs to be.”
“At Honey Insurance we invest in our customers by giving them smart technology for the simple fact that 50% of insurance claims are avoidable. We believe providing protection upfront is just as important as being there for them in the event of a claim.”
Honey Insurance is underwritten by industry giant, RACQ. Its CEO David Carter said, “Investing in Honey Insurance is an opportunity to share in the innovation and increase the scale of our insurance portfolio to benefit our 1.8 million members and their communities.”
Copyright © 2021 FinTech Global
