Prudential to buy US insurtech start-up Assurance IQ for $2.35bn

Prudential Financial is set to acquire US-based insurtech start-up Assurance IQ for $2.35 billion.

Using advanced data science, Assurance helps customers buy life, health, Medicare and auto insurance policies online through its on-demand service platform.

The company said the deal will add a growing direct-to-consumer channel to its financial wellness businesses, and will be accretive to its earnings.

The transaction includes a total upfront consideration of $2.35 billion, plus an additional earnout of up to $1.15 billion in cash and equity, contingent upon Assurance achieving multi-year growth objectives. Prudential plans to use a combination of its current cash, debt financing and equity to fund the deal, which is expected to close early in the fourth quarter of 2019.

“Assurance accelerates the strategy and growth potential of Prudential’s financial wellness businesses, bringing us closer to more people across the entire socio-economic spectrum to better serve the full picture of their needs,” said Prudential chairman and CEO Charles Lowrey. “We look forward to working with Mike Rowell and his entire team to grow the Assurance business in the US, and, over time, to extend its unique approach to customers around the world.”

Michael Rowell, co-founder and CEO of Assurance, said: “Assurance was founded to protect and improve the personal and financial health of every individual. Prudential’s shared vision, coupled with the strength of its offering and capabilities, make it the ideal partner with which to begin our next chapter. We are excited to create an ecosystem that reaches more people and new markets with a more expansive suite of products to drive our combined growth.”

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