Hello Friends!  We’ve reached the last week in June and 2023 is nearly half complete.  This week we are following an offer for Root Insurance, a substantial investment in Accelerant Holdings and debt capital to power insurance growth.  Here are the three things we learned:

 [1]

Root Insurance’s Board of Directors Tempted with Offer and Insurtech Merger

As reported by the Wall Street Journal, Root Insurance’s board of directors has received a tempting offer of $19.34/share to purchase the company. Although this offer is a significant premium over their recent trading price, it still values the company at a far lower $80 million than its peak of $7.5 billion during the recent insurtech bubble. The privately held Embedded Insurance, led by insurance technology entrepreneur, James Hall, made the proposal on June 9th.  Root’s board is currently evaluating how to deliver “shareholder value in accordance with its fiduciary duties”. While some analysts believe that this deal is worth accepting, it may not bring back investors’ full value. Elsewhere in the insurtech world, other companies are also receiving offers, and this week saw the promising merger of Insurance Quantified and Groudspeed Analytics, creating underwriting technology for commercial P&C insurers to make more informed underwriting decisions.

 [2]

Accelerant Holdings Secures $150 Million Investment and Introduces Risk Exchange Platform

According to reports, Accelerant Holdings has successfully secured a substantial $150 million investment from a globally recognized investment firm owned by MassMutual. This noteworthy investment coincides with the launch of their latest offering, the Risk Exchange platform. The platform is designed to facilitate seamless connections between institutional investors and insurance companies, and also provide comprehensive underwriting and portfolio management solutions. Accelerant Holdings recognizes that achieving optimal results in this industry requires complete data transparency, robust analytics for underwriting, and long-term capacity.  They have used this message to attract significant investment thus far and hope to continue this trend.

 [3]

Insurance Industry Benefits from Debt Capital for Growth Initiatives

This week, the insurance industry witnessed an influx of debt capital, highlighting the ongoing viability of debt markets as a reliable source of funding for insurance entities. One example is the successful completion of a significant $6.9 billion debt raise by Hub International. The funds raised through this endeavor will be utilized to refinance the company’s term loan debt. The debt restructuring empowers HUB to sustain its acquisition-driven growth strategy.  In a parallel development, Slide, an emerging home insurance startup, announced the closure of a substantial $35 million senior credit facility. This move is set to propel their growth objectives forward. Slide is strategically positioned to seize the opportunity to underwrite challenging property insurance in areas such as Florida, where larger carriers have exited the market.

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