3 Things – Insurtech Rough Year, Zesty.ai & Q2 Earnings

Hello Friends!  We hope everyone is doing well, staying cool and possibly enjoying time off.  This week we are following trends including the public insurtechs tough year, tech fundraising, climate change and insurance earnings season kick off:


Public Insurtechs Tough Year

It has been a though year for public insurtechs.  Hippo will attempt a reverse split of their stock to satisfy a non-compliance notice they received from NYSE for having an extended period of time trading under $1.00.  ROOT tried a similar maneuver last year but instead opted to switch from NASDAQ to the Russell 2000 small cap index.  Both insurtechs have fallen far from their IPO prices, HIPO has hovered around $0.80 as of this week.  Meanwhile, layoffs continue at several other companies.  Our friend Ian, wrote an interesting piece about the Founder’s Dilemma that explains very well what is happening.


Zesty.ai Raises $33M

The provider of property risk AI solutions closed a $33M round of funding.  The appetite continues for solutions in the property underwriting space to help with the increasing challenges including climate change.  Just this week saw massive heat waves in much of the US and Europe, bad storms and we are still watching for La Nina to exacerbate tropical activity.  Of course, we know that climate change will affect insurance and tools that can help underwriters assess risks for weather and wildfires will have a long runway.  Could climate change be happening faster?


Q2 Earnings Reports Start

Earnings reports are starting to roll out.  Travelers posted another net premium record but has a sharp decline in net income, down 41%.  They appear to be content making money where they can take rate in business insurance and bond/specialty while weathering the storm, leveraging their experience and underwriting discipline.  Speaking of discipline WR Berkley also posted record premiums but a similiar drop in net income, but continue to have an impressive combined ratio.  Marsh reports revenue growth, claiming to benefit from inflation with higher TIVs and managing expenses.  They are watching for recession and slowing GDP signals but mentioned how they have remained profitable during previous downturns, so again experience is on their side.

Thank you for following us, we appreciate your feedback and continued support.  Stay tuned for more info to come.  Until next time… stay safe, stay productive!