Clearcover, founded in 2016 and based in Chicago, plans to use the funds to hire more employees and invest in new products, Reuters reported. The company has not commented on its valuation.
Reuters reported it had spoken to someone with knowledge of the proceedings, who said the newest round would make Clearcover a unicorn, meaning its valuation would be at least $1 billion.
Clearcover is among the InsurTech providers that have reaped the benefits of the changes in the world due to the pandemic, including the now-lessened importance of physical insurance agent networks. Instead, Clearcover uses artificial intelligence (AI) and big data to cut costs and target customers with more accuracy, according to Reuters.
Global investments in InsurTech leapt 12 percent and are now sitting at $7.1 billion as of 2020, which is a record high, Willis Towers Watson said, per Reuters.
Clearcover CEO Kyle Nakatsuji told Reuters the company has seen the pandemic as “a light tailwind.”
“We’re a digital auto insurer, people still had to buy car insurance,” he said, according to Reuters. “They were shopping online more than ever.”
He added that there was already a bigger transformation going on in the industry, and the pandemic had expedited those changes, Reuters reported. Nakatsuji also said the company is planning to expand into new areas, although he didn’t say which ones.
In related news, Metromile CEO Dan Preston told PYMNTS that insurance is one of the many industries moving toward a digital-first mindset because of the pandemic. One of the casualties of the pandemic has been the long miles driven by many Americans, and they have been re-evaluating their insurance needs as a result.
The shift to working from home might continue, cutting down on time spent commuting, which will likely change auto insurance premiums.