Life Insurance Policy with AI

Sprout raises $12 million to use AI to find the best life insurance policy for you.

Despite the fact that the majority of people consider life insurance to be important, it is not as popular as it once was. In a recent survey, more than 80% of consumers agreed that people need life insurance, but only 62 percent said they have one. In fact, only 44% of U.S. households had individual life insurance in 2010, a 50-year low, compared to 72% of Americans who had life insurance in 1960.

With a novel service that rewards policyholders for making smart lifestyle choices, a New York- and Hartford, Connecticut-based startup hopes to buck the trend. Sproutt Insurance is the brainchild of Akitbo CEO Yoav Shaham, who set out nearly two years ago to blend analytics and health insights with AI to match people with life insurance providers.

According to a Microsoft survey, one of the top five concerns among IT teams is cyber risk, which is commonly defined as any risk of financial loss, disruption, or damage to an organization's reputation caused by the failure of its systems. That is not surprising given that the average cost of a cyber attack in 2018 was $1.1 million, a 52 percent increase from 2017.

With this in mind, Philip Edmundson founded Corvus, an insurance provider that uses AI to analyze corpora to assist brokers, policyholders, underwriters, and reinsurers in predicting and preventing loss. Corvus recently expanded its footprint to all major U.S. regions, and it has secured a large tranche of venture capital in anticipation of future growth.

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Corvus announced this morning that it has secured $32 million in series B venture funding led by Telstra Ventures, with participation from Obvious Ventures and existing Corvus investors.

406 Ventures, Bain Capital Ventures, and Hudson Structured Capital Management are some of the firms involved. It brings the Boston-based company's total funding to $46 million, following a $10 million series A round in late 2018.

According to CEO Edmundson, the infusion of funds will fuel the expansion of Corvus' headcount across underwriting, product, and data science teams. “When it comes to cyber risk, commercial insurance has failed both brokers and policyholders — we are obsessed with changing that outcome,” he added. “We envision a future in which brokers serve as educated cyber risk advisors, armed with better options for risk assessment, coverage, and risk management for their clients.”

Corvus, named after the corvids, a family of birds thought to be among the most intelligent, provides a dynamic loss prevention program that provides policyholders with AI-derived insights. The Corvus Score is one component. It is a measure of a company's IT security that takes eight metrics into account (ransomware and cyber extortion; network security and privacy; disclosure of sensitive information; hacking, malware, and unauthorized access; phishing and dark web monitoring; business interruption and system failure; contingent business interruption; and social engineering and cybercrime). This score influences the underwriting process — at least in terms of price and coverage options — as well as the recommendations and guidance Corvus provides to its clients.

Corvus' Flight platform allows brokers to triage cyber accounts, whereas CrowBar allows brokers to access claims and reports. CrowBar can provide a quote and Corvus Score in a matter of minutes by asking a few questions. Furthermore, it provides quick access to resources such as pre-claim assistance, risk management training, and learning resources.

On the policy front, Corvus provides a product called smart cyber, which covers risk classes such as health care, retail, financial institutions, education, professional services, life sciences, manufacturing, and construction, among others. It also offers data-enabled smart tech errors and omissions insurance (a type of insurance that protects businesses against claims of insufficient or negligent actions), as well as smart cargo and cyber products for shipments of life science, pharmaceutical, beverage, and food products for manufacturers, distributors, wholesalers, importers and exporters, and logistics companies.

The insurance tech market is booming right now, with a record $2.5 billion invested in U.S. startup deals in 2018. Next Insurance, an online platform that targets small business owners with a focus on specific niches (such as landscaper insurance and personal trainer insurance), raised $250 million last year. Pie Insurance, based in Washington, D.C., received $45 million in March 2019, a month after CoverHound received $58 million. Last April, commercial insurance company Embroker raised $28 million for its policy-matching online platform, and Huckleberry, a startup that uses AI to match small businesses with insurance plans, raised a whopping $18 million.

Marcus Bartram, a Telstra Ventures partner, believes Corvus' AI-first approach distinguishes it from the competition.

“Commercial insurance is one of the last industries to fully embrace data science and digital tools as a means of improving user experience for all stakeholders while avoiding unnecessary risk,” said Bartram, who intends to join the company's board of directors. “There is a massive opportunity to dominate the commercial insurance industry in the tech-enabled era, and we believe Corvus will play a role given their deep roots in the insurance industry and technology-led approach to product development.”

Vishal Vasishth of Obvious Ventures added, "We invest in startups that are reimagining huge sectors of the global economy in world-positive ways." Corvus is doing just that, driven by its mission to make the world a safer, more productive place through technology-enabled commercial insurance.”