Insurtech firm Root Inc. has added Minnesota to its list of covered states, pushing its auto insurance reach to 77% of the US population, according to a report by AM Best.
This expansion brings the company's operations to 35 states, reflecting its continued growth in the competitive insurance market.
Root distributes its policies both directly and through independent agents. Its model requires eligible customers to use a mobile app that tracks driving behavior during a multi-week “test drive,” which determines their premiums.
The announcement comes on the heels of a significant financial milestone for the company.
Root reported a net income of $22.8 million in the third quarter of 2024, a reversal from the $45.8 million net loss posted in the same period last year, according to AM Best.
In the same period, Root saw a 57% increase in its policies in force, to 407,313. Gross written premium, meanwhile, rose 48% to $332 million. During the period, the company generated $23 million in net income and operating income of $34 million.
This marks the first time the company has achieved profitability in its nine-year history.
Alex Timm, co-founder and chief executive officer, referred to the profitability milestone as a defining moment, signaling validation of the company’s business model and technology-driven approach.
Root’s underwriting strategy uses technology and data analytics to assess driving habits and personalize premiums. The company positions this as a method to provide potentially lower rates for safe drivers.
Operating in a market where digital platforms are increasingly critical, Root’s expansion underscores its efforts to transform traditional insurance practices through innovation.
The move into Minnesota aligns with its broader strategy of scaling its operations while maintaining a tech-focused approach to customer engagement.
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