Insurance technology companies like Lemonade have made inroads on the traditional real estate insurance market over the last five years by providing simple, low-cost access. Now, a fledgling proptech startup is helping legacy carriers and agencies compete.
GetCovered, a New York and Los Angeles-based firm launched in 2018, raised $7 million in a Series A round with the lofty ambition to become the “Shopify of insurance” for legacy carriers and agencies — a one-stop shop for renters insurance, rent guarantees, security deposit alternatives and other products.
RET Ventures, the Utah-based, proptech-focused venture capital firm, led the round, with participation from Pelican Ventures, Crocker Mountain Capital and the relocation technology startup Updater.
Real estate insurtechs like Lemonade and Hippo — both now-public companies with multi-billion dollar valuations — use artificial intelligence and machine learning to simplify buying insurance and filing claims. Without cumbersome paperwork and costly underwriting and sales staff, the companies have kept premiums remarkably low and attracted business from young renters and homeowners.
Insurtechs deepened their reach during the pandemic. LeaseLock, which offers a security deposit alternative, surpassed the $2 billion mark in insured lease value this summer. And Jetty, the Silicon Valley-backed financial services company, launched a rent guarantee product in September, rounding out its suite of real estate offerings.
GetCovered says it can compete with a comprehensive product offering and bespoke solutions that challenge insurtechs’ often limited product range. For example, Lemonade only offers renters and homeowners’ insurance, and Rhino, a security deposit alternative, only recently expanded into renters insurance.
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Today, GetCovered counts more than 500 hundred insurance carriers and agencies as clients. On the platform, which is primarily multifamily-focused, customers pick products from various carriers and buy them all at once.
“We’re able to customize our solutions down to the specific property or product level in a matter of hours, where larger competitors in the space have a canned, one-size-fits-all product,” said CEO Brandon Tobman, who co-founded the startup with Dylan Gaines and Ryan Solomon.
GetCovered’s platform helps legacy insurance agencies and carriers modernize their look to reach young prospective clients. But the company’s main competitive advantage is its partnerships with apartment managers and other proptech firms like Updater, which the startup’s backers say can help acquire customers in a more cost-efficient manner than direct-to-consumer insurtechs.
“With the traction they’ve already established partnering with proptech firms and synergies with our portfolio companies, we expect GetCovered to rapidly gain market share in the months and years ahead,” John Helm, Partner of RET Ventures, said in a release.
RET Ventures’ investors include large multifamily and single-family rental REITs that collectively own more than 2.4 million units. GetCovered aims to have 300,000 of those units onboarded by year-end, Tobman said in an interview.
“All of RET Ventures’ LPs are potential clients of ours,” Tobman said.
Smaller-scale managers will also be key to the startup’s growth. Early on, the company’s co-founders saw that small-scale managers didn’t have access to the same technology larger managers did, Tobman said.
“Shopify targets small e-commerce stores that want to get set up online, and we realized that could be our same business model,” he said. “We could go after the small property managers.”