Insurance startup Huddle has raised $19.25 million in a Series A round led by AirTree Ventures, with participation from existing backer Holland Insurance, Alium Capital, and SevenWest Media.
Founded in 2016 by Jason Wilby and Jonathan Buck, Huddle states it uses machine learning and artificial intelligence to assess claims and automate process, allowing members to sign up, make ‘Instant Claims’, and receive same day payments or replacement items approved in seconds.
Selling car, travel, and home insurance, the startup reported that it provides over $1 billion of insurance cover. Its policies are underwritten by Holland.
Wilby believes Huddle is in the right place and the right time as the Royal Commission underscores the need for new approaches to banking and insurance.
“The Royal Commission has, quite rightly, further highlighted the opportunity for a new model that’s open, and puts customers in control. Huddle is on a mission to fix the issues of trust that are plaguing traditional insurers,” he said.
Beyond the technology is a focus on building a community between members, which Huddle does through several measures, including its Community Council.
Should a member feel that something is unfair, and they are not happy with how the Huddle team has resolved it, it can be referred to the Community Council, where members will vote on anonymised issues. The outcome of the vote is binding on Huddle.
As a certified B Corp, the startup also seeks to invest in doing good. Its car insurance policies, for example, include carbon credits that offset 100 percent of the car’s carbon emissions, while it also states it does not invest in fossil fuels, and asks members to choose a charity to donate unused premium to each year.
“This combination of technology and community reduces fraud and operating costs, and ultimately reduces premiums,” Buck said.
James Cameron, partner at AirTree Ventures, said that the firm has tracked the insuretech space closely over the last few years, and determined that “Huddle is a standout team on every dimension”.
“This is a very new way to think about insurance – they are attacking one of the largest and most outmoded industries and creating an experience that customers can actually enjoy. They are using technology and a community focus to transform the experience of buying and claiming,” he said.
The focus on customers follows NAB chairman Ken Henry yesterday telling the Royal Commission that the question of whether financial services businesses are too close to shareholders at the expense of customers “goes to the state of capitalism”.
“The capitalist model is that businesses have no responsibility other than to maximise profits for shareholders. A lot of people over the past 12 months have said that’s all that you should hold boards accountable for,” he said.
Image: the Huddle team. Source: Supplied.