(Image source: Ethos website.)
Ethos, a San Francisco-based InsurTech distributor with the stated mission of transforming the life insurance space, reports that has significantly increased the size of the life insurance policies it will offer.
Effective October 6, 2021, Ethos will offer policies up to $2 million for Americans between 20-50. The company has doubled the policy limit for those 51-60 from $500K to $1M and for those 61-65 from $250k to $500K, while continuing to promise service in minutes without requiring a medical exam or blood test. Ethos claims the ability to offer a policy for over 90 percent of the U.S. adult population up to age 80, regardless of gender, age, health, financial position, etc.
“Even before the pandemic, the reality we were dealing with is that one in twenty children will lose a parent before they turn 15, and if it’s a breadwinning parent, most of those families will go bankrupt within three months,” comments Peter Colis, co-founder and CEO, Ethos. “Ethos’ proprietary underwriting engine is a constantly improving data cycle for precision matching of people to policies. These improvements have enabled this latest policy expansion, one of many moves we’re making to match more families with the best possible policy to suit their needs.”
According to a recent study by industry research firm LIMRA and non-profit Life Happens, 58 percent of men and 47 percent of women in the U.S. have life insurance, and despite a spike in sales during the pandemic, there are 102 million uninsured and underinsured Americans who believe they need to buy or increase their life insurance, representing 40 percent of the adult population. Ethos aims to use machine learning and data science technologies to increase the addressable market for life insurance. The company says it offers a technology advantage that reduces barriers which may prevent customers from purchasing life insurance, such as medical exams and blood tests.
Forty Percent of New Policyholders Under 40
Ethos’ stated goal is to create access to life insurance for a broader demographic of U.S. families, including more women and more low- and middle-income families. Over 40 percent of new policy holders in the first half of 2021 had incomes of $60,000 or less. Almost 40 percent of new policyholders were under the age of 40. Since January 1, 2021, the top five occupations held by new policy owners were homemaker, insurance agent, business owner, teacher, and registered nurse.
The policy coverage expansion closely follows a $100 million round from Softbank Vision Fund 2 that brought Ethos’s valuation to $2.7 billion and total funds raised to over $400 million. Ethos’ revenue and users have each grown by more than 600 percent year-over-year, and the company expects to issue $20 billion of life insurance coverage in 2021. In addition to its revenue and user growth, the company has surpassed $100M in annualized gross profit.