3 Things – Insurtech Funding Slowdown, Q1 Earnings Begins & Tesla Expands / GEICO stops phone sales – 4/22/2022

Hello Friends!  Another week has passed, we hope to see some of you next week in Hartford at the Insurtech Symposium.  As for this week we are following insurtech funding slowing down, Q1 earnings season beginning and Tesla Insurance and GEICO news.   Here are the three things we learned:


Insurtech Investment Slows Down                    

CB Insights released their State of Fintech Q1’22 Report (download required) this week.  It is worth reading to learn about how trends have led to an 18% quarter-over-quarter drop, the largest since 2018.  Based on what we’ve been seeing in the market this is not surprising but could also be that funding levels are returning to a more normal state as the market cools.  A drop off doesn’t necessarily mean that funding sources are drying up.  For example, Tokio Marine launched a $42M venture fund this week.  They will make a splash with fintech investment with this kind of money.


Q1 Earnings Season Begins

Travelers is off to a good start in 2022 posting premium growth of 11% and an improved combined ratio.  Commercial business is strong and they had less catastrophes as the world emerges from COVID.  Allstate doesn’t report earnings until May but previewed what they are expecting: cat losses of $462M and continued challenges with auto loss costs as inflation remains high.  RLI remains disciplined and has a combined ratio of 77.9%.  Marsh is riding the wave of rate hikes to revenue growth.


Tesla Insurance Expands, GEICO Pauses Phone Sales

Tesla has been making news in other ways with founder Elon Musk trying to buy Twitter but they are also quietly expanding their embedded auto insurance offerings this week adding 3 additional states bringing their today to 8.  They wrote $112M of premiums last year and will be able to grow this year.  The question is can they make this a profitable book unlike some of their peers?  They have data and that is powerful in auto insurance, not to mention the driver demographic of affluent individuals which usually leads to profitability.  In other news GEICO has paused phone sales in several states.  Just a guess but someone should check their rate filings in these states and weather they had increases that were not approved.

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