With $25 Million in New Funding, Home Insurtech Hippo to Expand

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Insurtech Hippo has nailed down $25 million in new Series B funding, a cash infusion the provider of super-quick homeowners insurance will use to fuel a hiring and geographical expansion.

Comcast Ventures and Fifth Wall led the round, along with a number of undisclosed FinTech investors. Previously, the insurtech startup raised a $14 million Series A round at the end of 2016, led by Horizons Ventures and joined by RPM ventures, Propel Venture Partners, GCV Capital and Pipeline Capital. FinTech investors and entrepreneurs participated in this round, too.

Hippo’s Head of Insurance Rick McCathron told Carrier Management that the money will help the digital agency expand its geographical reach and operations.

“We have two primary uses for the new investment – first, to increase our geographical footprint to some 60 percent of the U.S. population,” McCathron said. “Second, we are in the process of opening up a new customer and operations service center in Austin, Texas. This facility will house our growing team of talented insurance professionals, focusing on sales, service and underwriting.”

The Austin facility will also house Hippo’s “claims advocate concierges,” the company said.

Currently, Hippo employs 40 people in its Mountain View, Calif. office. McCathron said Hippo plans to “build out a significant team in Austin in the coming months.”

Hippo made its formal insurance marketplace debut in the California insurance market in April 2017. A managing general agency, the startup is licensed to operate in California, Arizona and Texas, and has plans to expand into other states over the coming months.

Hippo has partnered with TOPA Insurance in California to back its policies and with Spinnaker Insurance for its expansion into other states.

Hippo asserts it can provide online homeowners insurance quotes in 60 seconds and a full policy in about three minutes. Its online portal lets consumers type in their address, after which Hippo’s software searches a number of data providers to bring back most of the information traditionally needed when applying for homeowners insurance.

Hippo contends it can offer more comprehensive coverage by cutting costs through process efficiencies and updated policy provisions.

McCathron said he thinks this is an ideal time for Hippo’s approach to the insurance business.

“The paradigm has shifted,” McCathron said. “Over the next five years I predict everything will change – from customer expectations, use of data, and IoT devices in underwriting and risk mitigation, to technological advancements, reinsurance capacity, and where that capital comes from, everything.”

Hippo is not alone among insurtechs targeting the home insurance market. Others include Slice and Lemonade.