Digital MGA Clearcover Raises $50M; Plans on Entering More States, Becoming Carrier

Clearcover, a digital managing general agent focused on auto insurance, said it has raised $50 million in new financing. The company said the money will be used to accelerate further national growth as well as further its plans to become a full-stack carrier doing business across the country.

OMERS Ventures led the Series C financing. Previous investors American Family Ventures, Cox Enterprises and IA Capital Group also participated. The company announced a $43 million Series B financing a year ago, and with the new round, has raised more than $104 million since its 2016 launch.

“This investment enables us to continue delivering better coverage – for up to 230 million licensed U.S. drivers – for less money,” Kyle Nakatsuji, Clearcover’s co-founder and CEO, said in prepared remarks.

Clearcover said it has tripled policy sales year over year in 2019 while quadrupling premium. The company currently does business in Arizona, California, Illinois, Ohio and Utah. Clearcover said it plans to expand in existing markets and in new states throughout the U.S. in part by adding additional automotive and financial services industry distribution partners.

The company also said it is pursuing plans to become an insurance carrier in all 50 states and expand its partnership footprint.

Currently, Clearcover’s insurance policies are underwritten by Response Indemnity Co. of California in California and Clearcover Insurance Co. in Illinois. Response Indemnity is part of the Fortegra family of companies and is headquartered in Jacksonville, Florida.

Clearcover’s data-driven platform uses artificial intelligence to make coverage recommendations. The company pitches its platform as a way to streamline the insurance buying process and eliminate the need for excessive marketing, and it says the process boosts efficiency and can save customers 50 percent on car insurance.

Topics California Insurance Wholesale Funding