Brooklyn-based PolicyGenius has raised $15 million in a new round of funding to expand its price comparison insurance brokerage service.
Increasingly, old line industries are coming online, and insurance, one of the last holdouts, is no different.
Founded by a former McKinsey consultant who worked with the insurance industry in 2014, PolicyGenius provides users with price comparison information on life insurance, long-term disability insurance, renters insurance and pet insurance.
Offering content and advice, online quotes for policies, and an easy application process for consumers to get insurance, PolicyGenius has already reached 800,000 users by the end of 2015, according to chief executive Jennifer Fitzgerald.
Fitzgerald would not comment on how many of those users are policyholders or acquired policies through PolicyGenius. That’s actually the key metric, because no matter how many people the company advises, it doesn’t get paid by the insurers (who the company charges a commission for every policy it brokers).
No matter the actual revenue numbers, the company’s traction was enough to convince veteran investor and serial entrepreneur Steve Case and his Revolution Ventures firm to lead the Series B round for the company. Previous investors Karlin Ventures, Susa Ventures, AXA Strategic Ventures, Transamerica Ventures and MassMutual Ventures, the corporate venture capital arm of Massachusetts Mutual Life, also participated.
“It’s a $2 trillion dollar industry and it really hasn’t changed that much,” says Case. “[PolicyGenius] is taking an industry that’s huge and hasn’t changed much in a long period of time and bringing internet dynamics to it.”
Indeed, PolicyGenius is a potential solution to the industry’s coming labor shortage, according to Fitzgerald. “The average age of an insurance agent in the U.S. is 59, and a fourth of those are going to be retired in a few years.”
On top of the industry’s staffing problems, there’s also a disconnect between the insurance that consumers need and the number of folks who actually have policies, according to Fitzgerald and industry analysts (keep in mind these are insurance industry analysts).
Citing data from reinsurer Swiss Re, Fitzgerald says that the life insurance gap in the U.S. is about $20 trillion dollars. That’s a freaking big number.
Life insurance, in fact, is the company’s most popular product, followed by disability insurance. And while the company is currently operating solely as a brokerage, it could soon white-label insurance products from insurance companies and sell those products under its own brand, according to Fitzgerald.
For now, though, it’s primarily about the company’s content and its insurance checkup tool.