On occasion of its sixth birthday, the Insurtech startup Friendsurance announces the closing of its latest funding round in which the company collects $15,3 million. The fresh capital comes from various investors and is the biggest investment in the peer-to-peer insurance segment ever.
The financing round was led by Hong Kong-based Horizons Ventures, which already invested in Friendsurance in 2014. The round was completed by strategic investors and business angels from Asia and from the USA. Friendsurance is already financed by various institutional and private investors of the internet scene including the associated companies of Otto Group Eventures, the German Startups Group and the European Regional Development Fund.
Friendsurance was founded in 2010 and is headquartered in Berlin. The young company now plans to internationalise its business model.
Friendsurance co-founder Tim Kunde stated: “Having an experienced VC like Horzions Ventures investing in our business model for the second time, is a certificate of trustworthiness in our concept and our development. We intend to use the fresh capital to grow further in the German market and expand internationally. Our first expansion target for 2016 will be Australia. We are presently considering expansion opportunities for further markets.”
With the help of Friendsurance, customers can conclude new insurances with claims-free bonus or complete existing insurance contracts with the claims-free bonus. To activate the claims-free bonus, customers with the same insurance type are combined online to small groups. Part of the insurance premium is paid into a cash back pool. If no claims are submitted during the year, each group member get his cash back in the following January. So far over 80% of the users received a cash back. In nonlife insurance segment, the average cash back represents a third of the paid-in-premiums. At the same time, the claims-free bonus provides an added value for insurance companies cooperating with Friendsurance. They profit by increased customer satisfaction and cost savings, because the claims-free bonus offers positives incentives against insurance fraud.
Frances Kang from Horizons Ventures said: “In the two years since Horizons invested, we’ve witnessed the satisfying company’s growth from a small but committed team into a grown-up with a six digit number of customers, 70 insurance partner and a team of more than 80 employees. Worldwide, 15 imitators are copying the peer-to-peer insurance model which shows its highly promising concept.”
