Revolution Ventures is leading a $15 million funding round into insurance tech startup PolicyGenius. The Steve Case and Ted Leonsis-backed Revolution has had the insurance industry in its cross-hairs for a while now, pulling the trigger on funding the New York City-based PolicyGenius as part of its bigger goal of disrupting stagnant industries.
“Tackling an old, inefficient space with a lot of margin like insurance is exciting,” Revolution partner Clara Sieg told DC Inno in an interview. “Think about the insurance landscape, it’s a couple trillion dollar industry and it hasn’t been disrupted in a long time.”
PolicyGenius is an online platform for finding and buying insurance founded by two insurance experts who used to work at McKinsey. It’s designed to offer the kind of e-commerce experience people have grown used to with other services, but for life, renters, long-term disability, and pet insurance.
“They take a pretty different approach to the market with their core focus,” Sieg said. “A lot of people are attacking the health insurance space, but the founders have a really deep understanding of how the industry works.”
Instead of setting up a lead for insurance companies to call like standard insurance websites, it offers tools to figure out how much insurance you need and gives you quotes for insurance you can apply for through the website. PolicyGenius acts as a licensed, independent broker that gets a commission from the insurance company, but the rates are the same as applying any other way because of how insurance is regulated.
“Think about the insurance landscape, it’s a couple trillion dollar industry and it hasn’t been disrupted in a long time.”
“PolicyGenius does it in a really consumer-friendly way, its not spammy and you don’t get hounded,” Sieg said. “It’s really taking a consultative approach, empowering consumers. They know that tech can’t just put a band-aid on the issue.”
Sieg said that Revolution is providing the bulk of the funding, which brings PolicyGenius’ funding to about $21 million total. It’s the largest initial investment that Revolution Ventures has ever made. As part of the deal, Revolution’s David Golden will join the board of directors while Sieg takes on an observer role. The money will go to expanding the reach of the company and adding new kinds of insurance coverage so that it can attract even more customers.
“Insurance has crazy margins and its non-trivial from the consumer perspective,” Sieg said. “It’s one of the last industries to be brought online and and we’re funding a transformation giving consumers more power.”