Insurer Beazley has expressed further support for an industry disruptor in the form of monetary backing.
Investing in insurtech start-up Digital Risks, Beazley was among the firms which participated in an investment round led by venture capitalist Concentric. Other financial backers include Atami Capital, Seedcamp, and London Co-Investment Fund.
The digital-first insurance provider, which caters to fast-growth technology and media businesses, raised a total of £2.25 million in the financing round.
“Beazley is delighted to be supporting the next stage of growth for Digital Risks,” commented Mark Goodman, head of corporate development at Beazley. “We have been working in partnership for the last year to provide cyber and professional indemnity insurance to their clients, which has provided the opportunity for us to experience first-hand the quality of the Digital Risks team and their proposition to the rapidly growing tech and digital sector.”
Co-founded by Cameron Shearer and Ben Rose, Digital Risks utilises proprietary software to automate not only the buying element of the process but also the managing aspect of insurance.
“Rather than providing a simple price comparison service, or consolidating the customer’s risks to a single underwriter, the platform considers risks individually and places them with the most suitable provider,” explained Digital Risks. “The system follows a similar model to the more traditional offline broker process, but sold entirely online and as a single experience.”
Shearer described the commercial insurance industry as having been “characteristically slow to respond” to match the phenomenal growth rate among digital industries, citing the need to evolve in terms of product design, distribution, and customer engagement.
“How businesses want to buy and manage their insurance has changed, with traditional offline brokers and annual commitments seen as old-fashioned and inflexible to today’s digital natives,” commented the chief executive. “There’s also a lack of understanding of emerging technologies, the risks involved and how to cover them, particularly with the rise in online threats, such as data breaches and social engineering.”
The business, which uses a flexible monthly subscription model, plans to expand into Europe in the next 12 months. Aside from Beazley, Aviva and Tokio Marine are among the underwriters behind Digital Risks’ products.
“We’ve been looking for a suitable investment in the insurance space for a number of years, but it has been a hard space to crack, with few teams showing us that they have what it takes,” said Concentric partner Denis Shafranik. “Digital Risks has that rare combination of insurance know-how, technical understanding, and the ability to execute, giving us the confidence that they will become the leading digital insurance brand in the years to come.”
