Lloyd’s of London has invested around $150,000 in artificial intelligence start-up Layr, which focuses on commercial insurance products for small businesses.

The insurance giant made the investment after testing the American star-up’s cloud-based commercial insurance platform in Lloyd’s Lab, its insurtech innovation lab.

Lloyd’s Lab welcomed a second cohort of 12 insurtech start-ups last week. Layr participated in the first cohort of the innovation lab.

Layr, which was founded in 2016 in the US, tested its cloud-based solution at Lloyd’s Lab for providing faster access for small businesses looking to purchase liability insurance.

The insurtech company said that it will use the money to further develop its product.

Additionally, Layr is also looking for potential distribution opportunities with several Lloyd’s syndicates.

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By GlobalData

Layr’s platform side-steps carriers’ APIs and instead leverages its proprietary price and appetite prediction engine to match business with the right policies.

The US start-up uses AI and machine learning to compare an applicant against clusters of similar small businesses.

Lloyd’s CEO John Neal said: “Lloyd’s Lab provides us with an exceptional environment to test and accelerate the implementation of new technological solutions.

“I am delighted that syndicates have teamed up with Parsyl and Lloyd’s itself has invested in Layr following the Lab’s first cohort, and I am looking forward to seeing what solutions emerge from the second cohort.”

Layr CEO Phillip Naples said: “Modern business owners do everything online, so Layr is the natural evolution for small business insurance.

“We feel validated that the world’s oldest and most respected insurance marketplace agrees and recognises that the technology we’re creating is the future of small commercial distribution.”