Raincoat, a startup developing scalable climate insurance solutions, has announced the closing of an additional $6.5 million seed round.
This follows the $4.5 million Raincoat raised last year, bringing its total raised to date to $11 million.
According to the announcement, the latest round of capital will support the company’s expansion to new markets to provide FEMA-like services – much faster than existing emergency solutions – after particular disasters such as hurricanes and earthquakes in the Caribbean, Mexico, and the Gulf Coast, wildfires in the west, and threats such as flood, drought, and excessive rain in Colombia and Brazil.
Jonathan González, Raincoat CEO and co-founder, said: “We look forward to pushing the limits of what’s possible and bringing our technology to more communities thanks to this new round of capital.
“Insurance should be there to protect you – and the expectation of payment after a catastrophe should not create anxiety – but rather bring ease. We are innovating today for the current and future generations and look forward to working with more local and international players to make this happen.”
In less than a year, Raincoat has provided disaster relief protection to thousands of individuals and families with successfully executed payments in all of their active markets.
The company has been able to position itself as the fastest growing insurtech startup aimed at reinventing the industry by enabling immediate payments following climate disasters and offering coverage for losses that traditional insurance companies typically exclude.
Raincoat’s embedded parametric insurance model enables distribution channels to offer protection against the occurrence of a specific event given fixed parameters, such as the magnitude of the event – instead of the magnitude of losses incurred.
The funding round was led by TwoSigma Ventures – along with European based VC firm Mundi Ventures, Revolution’s Rise of the Rest Seed Fund and EleFund.
“Climate disaster is now happening with more frequency and intensity than ever before, and the insurance industry at present, based on manual claim adjustments that take months or even years to process, just cannot scale to match the growing risk. The world needs innovative, scalable data-driven solutions like Raincoat to make businesses and families more resilient,” said Colin Beirne, Partner at Two Sigma Ventures.
Moisés Sánchez, General Partner at Mundi Ventures, added: “Investing in Raincoat represents a strategic opportunity to tap into the transformative potential of parametric insurance.
“Raincoat’s strong suit positions them as a prominent player in the industry. Their offering of fully automated solutions to address climate risks at-scale sets them apart in this space.”
