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Root Insurance

Neo Insurance
Segments:
Automobile, Homeowners & Renters
?
Product stage:
Growth
?

Root Insurance is a full-stack insurance provider focusing on usage-based automobile insurance. The company offers a mobile app that collects data on driving speeds, braking patterns, and driving times using smartphone sensors, and applies artificial intelligence (AI) and predictive models to offer a personalized premium to the customer. The company claimed that the latest model utilizes double the proprietary data, demonstrating 17% greater predictive capabilities than the previous model. Moreover, the app incentivizes safe driving by providing greater insight into one’s driving patterns and issuing additional discounts for improved driving behavior. Root allows customers to file claims directly through the mobile app. As of December 2021, Root held a carrier license in 48 states and offered automobile insurance in 32 states—most recently in Kansas.

In July 2019, Root launched its renters’ insurance product and expanded to homeowners insurance in May 2020. The homeowners’ insurance is provided through a partnership with Homesite Insurance, a Boston-based property and casualty insurer that will underwrite any homeowners insurance policies issued by Root. As of June 2021, the company’s renters’ insurance product was available in eight states.

Key customers and partnerships

Root had 203,840 policies in force as of June 2023.

Root entered into a partnership with Carvana in July 2022, to offer usage-based auto insurance policies on the latter’s used-car online platform.

In addition, it had also collaborated with other players in the insurance space to optimize and digitize its insurance services.In January 2021, Root partnered with Tractable, a UK-based provider of AI-based solutions, to leverage its AI Subro solution to optimize Root’s end-to-end claims process, starting with subrogation, where two insurance carriers negotiate the division of expenses when multiple parties are involved in a claim. It also partnered with CCC Intelligence Solutions in February 2023, to use its first-party casualty solution to streamline and digitize first- and third-party casualty claims through a single digital workflow.

Funding and financials

In October 2020, Root sold 26.8 million shares in its initial public offering (IPO), raising USD 724.4 million in the process at a valuation of USD 6.8 billion. In January 2022 , Root received a five-year term loan of USD 300 million from BlackRock Financial Management (BlackRock) to extend its debt maturity and improve its liquidity position.

For the full year of 2022, Root reported total revenue of USD 310.8 million (down 10.0% YoY), while its net losses improved to USD 297.7 million from a loss of USD 521.1 million in 2021. Its gross loss ratio improved to 82.1% from 86.0% in 2021.

Neo Insurance

Neo Insurance

Key stats
Featured companies
180
Total funding (USD)
13.5 Bn
Total addressable market (USD)
143.4 Bn
Key competitors
 
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Company profile
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EDGE Insights

Has Root Insurance found its bottom?

Recent Updates

Earnings/results
Aug 2, 2023
Root’s Q2 losses narrows down on the back of improved pricing decisions and expense management
Neo Insurance
M&A
Jun 29, 2023
Root issues statement relating to takeover bid from Embedded Insurance
Neo Insurance
M&A
Jun 21, 2023
Root receives takeover bid from Embedded Insurance
Neo Insurance
Earnings/results
May 3, 2023
Root reports Q1 2023 results; beats analyst estimates despite declining revenues
Neo Insurance
Earnings/results
Feb 22, 2023
Root reports continued decline in revenue in Q4 2022, despite beating analyst estimates
Neo Insurance
Management news
Earnings/results
Nov 9, 2022
Root reports declining revenues for Q3; announces layoffs to improve cash burn
Neo Insurance

Company Brief


HQ location:
80 E Rich Street Suite 500 Columbus OH USA
Founded year:
2015
Employees:
501-1,000
Total Funding:
USD 827.5 million
Last Funding
USD 300.0 million, Jan 2022

Funding


Investors


No investor data is available

Funding data are powered by Crunchbase
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