San Francisco-based Verily, an Alphabet company, is creating a subsidiary, Coefficient Insurance Co., to compete in the medical stop loss market. The new business will be backed by Swiss Re Corporate Solutions, the commercial insurance unit of the Swiss Re Group.
Coefficient says it will leverage Verily’s hardware, software and data science and Swiss Re Corporate Solutions’ risk knowledge, distribution capabilities and reputation in the employer stop-loss market.
The company offered no timetable yet for the launch.
According to Verily, its data-driven precision risk model helps self-funded employers control cost volatility. Employer stop-loss insurance protects self-funded employers from unexpected and large employee health benefit claims by reimbursing employers for claims above a defined amount.
“Employers have been facing rising and increasingly unpredictable healthcare costs for years,” said Andy Conrad, CEO, Verily. “Coefficient is aimed at reducing blind spots and providing greater cost control mechanisms for self-funded employers, and we expect that partnering with Swiss Re Corporate Solutions will help us to better develop and distribute our precision risk solution to the employer stop-loss market.”
Swiss Re Corporate Solutions has agreed to make a minority investment in Coefficient. In connection with this investment, Ivan Gonzalez, CEO North America, Swiss Re Corporate Solutions, is expected to join the Coefficient board of directors upon closing.
According to the National Association of Insurance Commissioners, Coefficient Insurance Co. is domiciled in South Carolina and was first incorporated in 1980 by BankAmerica Corp. as General Fidelity Life Insurance Co. In January, its name was changed to Coefficient. It is licensed for life and accident and health insurance.
Launched in 2015, Verily is a subsidiary of Alphabet focused on life sciences and healthcare.
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