(Image source: Hippo.)
Hippo (Mountain View, Calif.) a startup insurer dedicated to providing a simpler process to help homeowners find more appropriate coverage, has announced a $70 million round of growth funding co-led by Felicis Ventures, a Menlo Park, Calif.-based venture capical firm, and Lennar Corporation, a Miami-based home construction and real estate company. All major existing investors also participated in the round of funding. Hippo says it will utilize the funding to accelerate growth while continuing to deliver what it calls a modernized home insurance product that includes world-class customer experience on a national scale.
Hippo launched in 2017 aiming providing insurance policies with more comprehensive coverage for homeowners while cutting premium costs up to 25 percent. Since January 2018, the company grew its policy sales by 30 percent month over month and launched into 10 new states covering more than $20 billion in total property value.
“Hippo has set the bar for the future of insurance with its fully automated, proprietary policy management and proactive underwriting,” comments Victoria Treyger, Managing Director, Felicis Ventures, who will be joining the Hippo Board of Directors. “The company leverages thousands of data points to underwrite customers in minutes and proactively monitors and alerts homeowners when key repairs or weather protection is needed to protect their most important asset. Insurance is the next big sector to undergo the dramatic transformation of customer experience and improved risk management enabled by access to real time data. We see Hippo’s current growth rate and efficient automated policy management system as just the beginning of driving this transformation.”
InsurTech is anticipated to grow from 4 percent of the current insurance market to more than 10 percent by 2023, according to a recent Jupiter report, totaling more than $400 billion in premiums. Today, Hippo is accessible to more than 40 percent of the U.S. homeowner population, and that number is anticipated to grow to more than 60 percent by the end of 2018, the company reports.
“Hippo has clearly captured the direct to consumer home insurance market with their efficient product, modern coverage and customer friendly approach,” comments Eric Feder, Senior Executive, Lennar Corportation. “This investment marks the beginning of our relationship with Hippo and reflects our enthusiasm for exploring opportunities to streamline and improve the insurance process for our home buyers.” Feder will join the Hippo Board of Directors.
According to a Hippo statement, Fifth Wall, a follow-on investor in the round, facilitated and structured the partnership between Hippo and Lennar (a Strategic Limited Partner in Fifth Wall) after co-leading the Series B. Through Fifth Wall, Hippo says it is able to quickly test and gauge validation from established builders, developers and other companies taking part in the way technology is being used in construction and real estate.
Hippo says it will use the new funding to focus on dramatically improving buying the right home insurance as part of the home-buying experience, while creating a better customer experience and offering smarter coverage.
“Homebuying is the engine of the American economy, but the process for acquiring homeowners insurance—a requirement for most homeowners—has been antiquated, analog and inefficient,” comments Brendan Wallace, co-founder and managing partner, Fifth Wall. “This game-changing partnership is a great example of how a real estate incumbent like Lennar can influence innovation cycles in the market by integrating with a best-in-class startup to move the industry forward.”
Hippo reports that it delivered over 800 product updates in 2018 alone, or roughly two per day and doubled its online conversion rate during the same time period, primarily aimed at solving the underinsurance problem more than half of the U.S. homeowner population faces today, according to research undertaken by Hippo.
Heavy Focus on Customer Experience
“Our heavy focus on customer experience for every client, from first time homeowners to home insurance experts, has been one of the main keys to our success,” comments Assaf Wand, co-founder, Hippo. “From a client’s first interaction with us, to our regular coverage tracking, we always keep their needs in mind. We’re eager to expand our footprint, launch new products and bring our incredible customer service to clients nationwide.”
Hippo’s series C investment brings the company’s total funding raised to $109 million. The current investor base includes the following: Abstract Ventures, Aquiline Technology Growth, Comcast Ventures, Fifth Wall, GGV Capital, Horizons Ventures, Munich Re, Pipeline Ventures, RPM ventures and Zeev Ventures.