Cuvva raises £15m ($19m) in funding to take on insurance establishment
Cuvva, an insurance disruptor that began as an app offering pay-as-you-drive motor insurance, has raised £15 million ($19 million) of venture capital backing to target the long-term motor insurance business.
RTP Global, Breega and Digital Horizon have joined seed investors LocalGlobe, Techstars Ventures, Tekton and Seedcamp to invest in the app-based insurance platform, which recently announced the appointment of the Lloyd’s of London chairman as its chair. Angel investors from the insurance sector, including Dominic Burke, the CEO of Jardine Lloyd Thompson and Faisal Galaria, the former chief strategy and investments officer of GoCompare, have also put in capital.
Cuvva’s Series A funding comes as the company prepares to launch a pay-monthly insurance product for the first time, a key step in its ambition to provide one gateway app to serve all consumer insurance needs.
Freddy Macnamara, founder said: “The way insurance is sold hasn’t kept up with the way people live their lives now. We buy lots of goods and services via flexible subscriptions to suit our on-demand lifestyles. Why shouldn’t you be able to do that for insurance?
"I started Cuvva when I couldn’t find flexible insurance to help me share my car. Four years on from launch we are still discovering how big the problem we are solving really is. We're now selling 3 percent of all UK motor insurance policies but we’ve got so much further to go. Cuvva is going to be the place where you buy all your insurance, all through our mobile app."
The pay-monthly motor product will launch early in 2020 and Cuvva says it could cut average annual bills for car owners significantly. Cuvva plans to cut out all middlemen including brokers and comparison websites, which charge insurers about £70 on each policy sold. Unlike legacy insurers, Cuvva will not charge a fee to spread payments over the year and it will not penalise loyal customers with dual pricing. The start-up will offer the same savings, whether you are signing up as a new customer or a returning customer. It also won’t charge admin fees to alter personal details, like a change in job title.
Since pioneering hourly insurance in 2016, Cuvva has sold more than 40 million hours of insurance and has over 250,000 customers, becoming the UK’s most downloaded insurance app. It has also expanded beyond insurance aimed at drivers who want to borrow a friend’s car into flexible single trip travel cover.
The London-based company will use the proceeds of its fundraising to add engineers, developers, marketeers and customer operations staff to its 80-strong team. Over the next 18 months, it expects to double in size and already has a 30 strong in-house customer operations team.
