Turnkey insurance company Authentic has secured $5.5m in funding during its seed financing round to launch a new insurance platform, Captive in a Box.
Slow Ventures led the funding round with Altai Ventures, MGV, Upper90, Clocktower, and Commerce Ventures, among others taking part.
The Captive in a Box platform aids vertical software as a service (SaaS) companies, franchises, and groups to introduce captive insurance programmes for its members in the upcoming weeks.
Authentic’s turnkey platform is equipped to manage all the logistics required to establish a captive insurance company.
The company also provides assistance in legal, underwriting, reinsurance and capital, managing claims, and client services, among others.
Authentic CEO and founder Cole Riccardi said: “Captive insurance provides many benefits to organisations and their members, but until now, setting one up was a very long and expensive process.
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“Through Authentic’s platform, anyone can create their own captive insurance programme and realise the benefits within days.”
To monetise insurance, vertical SaaS companies and franchises previously relied on selling their leads to insurers for a one-time lead fee. They also adopted an approach of collaborating with insurance brokers or carriers to receive commissions for sold policies, the company noted.
With Authentic, partners receive a commission for every sold policy apart from a major share of the underwriting profit.
To collaborate with Authentic, partners are required to include a line of code into their platform to commence the sale of insurance.
Slow Ventures managing partner Sam Lessin said: “Authentic’s Captive in a Box allows them to sidestep the current distribution problems of adverse risk selection that the insurance industry has struggled to overcome.
“Authentic’s partners stand to benefit from sharing data to better assess and price risk, as they are the ones that reap the rewards from more successful programmes.”