Authentic, a turnkey insurance platform that allows vertical Software-as-a-Service (SaaS) businesses to adopt the benefits of captive insurance, has raised $5.5 million in seed funding led by Slow Ventures, with participation from Altai Ventures, MGV, Upper90, Clocktower, Commerce Ventures, Mischief Ventures and Core Innovation Capital.
Captive insurance provides a variety of different benefits, including creating an additional revenue stream for parent companies, tailored insurance coverage, lower insurance premiums, and much more.
However, for the last five decades, only the larger corporations have mainly utilized captive insurance companies due to the cost and complexity of setting one up.
But, according to Authentic, their “Captive in a Box” platform now makes it possible for any Vertical SaaS associated business to launch captive insurance programs for their members within the short space of a matter of weeks.
The company’s turnkey platform handles all of the logistics of setting up a captive insurance company.
This includes, the legal side in terms of setting up a domicile, as well as the underwriting, reinsurance & capital, and claims management.
Cole Riccardi, CEO & Founder, Authentic, commented: “Captive insurance provides many benefits to organizations and their members, but until now, setting one up was a very long and expensive process. Through Authentic’s platform, anyone can create their own captive insurance program and realize the benefits within days.”
“Over the last few years, we’ve seen a lot of software startups becoming FinTech companies by embedding payments and lending products to monetize their customer base,” stated Marc Schroder, founder of MGV.
“Insurance is the next embedded product, but what makes Authentic a win-win is that software companies, roll-ups, etc., can create a new revenue stream while its members get hyper-tailored insurance policies at a fair price,” he added.
“Authentic’s ‘captive in a box’ allows them to sidestep the current distribution problems of adverse risk selection that the insurance industry has struggled to overcome,” said Sam Lessin, Managing Partner, Slow Ventures.
“Authentic’s partners stand to benefit from sharing data to better assess and price risk, as they are the ones that reap the rewards from more successful programs.”
Based out of Manhattan, NY, and Dayton, OH, Authentic is comprised of professionals from leading technology and insurance companies, which includes Next Insurance, Amazon, Canary Consulting, and Aquiline Capital Partners.