(Image source: Roots Automation.)
Roots Automation (New York City), a global intelligent automation vendor offering “Digital Coworkers” for the insurance industry, has announced the closing of $10 million in a Series A round of funding. MissionOG (Philadelphia) led the round, supported by Liberty Mutual Strategic Ventures, Vestigo Ventures and CRV.
Roots Automation boasts that it has established a new category in business process automation. The company’s Digital Coworker leverages AI and machine learning to improve insurance operations, empowering insurance carriers to improve margins and increase operational efficiency. An alternative to robotic process automation (RPA) technology, which the vendor says has fallen short of its promise to automate tasks in unstructured environments, Roots Automation’s Digital Coworker ingests and analyzes both structured and unstructured data to work seamlessly with a company’s human workforce, addressing a $100+ billion market opportunity to improve insurance operations through automation and AI.
Roots Automation reports that it has enjoyed massive customer growth since announcing its seed funding in October 2020, which the vendor says is largely from prominent insurance brands for which RPA has failed. Its Digital Coworker improves claims management efficiency, which represents a $67 billion market opportunity with P&C US carriers alone; and improves the average 8 percent premium leakage seen by the standard P&C insurer – or roughly $57 billion annually, the vendor says.
Mission to Make Work More Human
“AI and machine learning are the key in enabling effective automation,” comments Chaz Perera, co-founder and CEO, Roots Automation. “Our latest capital represents a major milestone in our mission to make work more human. It will fuel product development and market expansion so we can further support insurers that are dealing with increased margin pressure and declining operational efficiency. In 100 percent of the deals we win, the customer has considered or already purchased RPA and instead gone with a Digital Coworker, lessening their dependence on employees at a time when keeping their workforce happy and engaged is most critical.”
According to the “State of Operations and Outsourcing” report by HfS Research (Cambridge, England), supported by KPMG, 44 percent of Global 2000 enterprises are dissatisfied buyers of RPA. By contrast, Roots Automation says, Digital Coworkers focus on ensuring harmony in the employee/digital coworker ecosystem, handling automated tasks while freeing an insurer’s human workforce to do customer-focused, meaningful work, increasing job satisfaction. “This new paradigm comes at a critical time for the historically slow-to-innovate insurance market, which is struggling to fill jobs and retain workers in a talent crisis, and amid rising costs,” a Roots Automation statement says. “Digital Coworkers increase companies’ agility and ability to exceed customer expectations, without requiring them to substantially rethink the way they work. This leads to a happier workforce while maximizing revenue.”
“We are excited to provide expansion capital to Roots Automation, as they are solving some of the biggest problems facing insurance companies,” comments George Krautzel, managing partner, MissionOG. “Roots’ founding team’s DNA in insurance has guided them to build a vertical solution to provide value and scale where horizontal RPA solutions have not succeeded. Their Digital Coworkers offer a positive experience for customers and human employees alike, while managing day-to-day insurance business proceeds. We look forward to seeing the Roots team expand their value to customers and build on their leadership position within their industry.”
“Roots Automation has helped American Exchange automate and improve a lot of our internal data validation and data entry processes,” says Andrew Hetzler, CEO, American Exchange, a Chatanooga, Tenn.-based TPA. “This has both reduced our workload and has reduced human data entry error to almost zero. The best part is that our process with Roots Automation has allowed our agents to do what they do best, and that is talk to people and help them with their individual and Medicare health insurance decisions.”