Just make sure, a pay-per-kilometer insurance technology company, raised $ 8 million in a funding round.
CrossCut Ventures, ManchesterStory and Western Technology Investments co-led the investment, bringing its total raised to $ 15.3 million since its inception in January 2019.
Los Angeles-based Just says he’s using telematics “to reward safe drivers and reduce insurer bias” by looking at factors like how, when and where customers drive, rather than factors like code. postal or marital status as do most traditional insurers. Or, more simply, it only charges customers for kilometers driven and its rates vary depending on driving behavior. This way, Just says he is able to offer lower rates for “safer drivers” and claims to save his clients about 40% from their “old auto insurance company.” For now, it’s only available in Arizona, although the company plans to expand to other markets such as Texas, Nevada, Pennsylvania, Ohio, and Georgia.
Image credits: Just make sure
Of course, Just isn’t the first company to offer personalized auto insurance. There is Metromile, which launched its personalized automobile insurance per kilometer in 2012. And there is also Root insurance, an Ohio-based auto insurance startup that uses smartphon technology to understand the behavior of each driver. While there are similarities between Root and Just, there are also some distinct differences, according to founder and CEO Robert Smithson.
Root charges customers a monthly fee, and when policies are renewed, the rate is subject to change based on driving behavior. Just has a similar model. If its drivers adopt a safe driving behavior, their prices may go down. On the other hand, if they exhibit dangerous behavior, their levels may increase. But unlike Root, Smithson said, Just only charges his “liability” customers for miles driven. There is no monthly fee. For “full coverage” customers, Just also includes a “small daily surcharge” to reflect the risk that someone might steal their car. For its part, MetroMile charges customers a base rate. more a price per kilometer. Neither rate is affected by how well a person drives, notes Smithson.
“The [Just] the price per mile that a customer gets can change monthly. This means we are able to quickly reward safe drivers with lower fares and increase them for those who drive less well, ”said Smithson. “This quick feedback loop encourages people to make smarter driving decisions. And that means our customers have fewer accidents and we do better. “
In 2020, Root had a direct loss ratio of 82%. Just’s direct loss ratio is 65.8% year-to-date. But of course it has a lot fewer customers and only serves one market. Yet the The company says it has already achieved underwriting profitability in terms of the share of premium it pays in claims.
Plus, with so many people switching to working from home in the past year, Just says demand has increased this year. It issued over 1,000 new policies in the second quarter, a “ten” from To the same period in 2020. The startup said that during this same period, its revenue increased by 1,400% compared to the second quarter of 2020.
“People are just driving less because of increased work-from-home fares, and that won’t change anytime soon,” Smithson said. “Our approach allows us to offer customers rates that truly reflect their conduct.”
The company compares its user experience to that of a prepaid calling card. Only customers can “top up” their account for $ 30 for minimum liability coverage and $ 75 for full coverage to start driving. Of the society the insurance policy is for 30 days. So, as customers drive, their balance goes down. Every 30 days, the company changes the price of each customer as it collects more data about their driving habits.
It’s an approach Matt Kinley, co-founder and managing partner of ManchesterStory, had never seen before.
“It’s fairer, more affordable and personalized across the board, and unique because the company offers customers rates that truly reflect their driving, which rewards safe drivers with lower insurance premiums,” a- he declared.
The company plans to use its new capital in part to hire – it currently employs 35 people – and expand its product offering. It also plans to launch beyond Arizona into neighboring states. In particular, Smithson said the startup was “eager” to launch in Texas.