The commercial insurance market is valued at more than $800B per year. Much of the predicted growth in this market over the next decade is expected to come from the digitization of the industry to make quoting, securing, underwriting, and servicing of policies more seamless. Coverforce is an insurtech platform that features API-based connectivity to allow carriers and insurance agencies to work digitally with one another, eliminating back-and-forth interactions that were previously mostly manual and time-consuming. The API allows agents to receive quotes from multiple Tier 1 carriers instantly in addition to handling policy documents, issuance, and payment for all types of business policies including workers’ compensation, business owners policies (BOP), general liability, and cyber. Coverforce also offers a while-label retail experience that can be integrated into agency web presences to allow customers to receive quotes directly, complete with online comparison capabilities. By digitizing the experience, the platform offers a better experience between carriers and agencies, unlocking new channels for distribution for carriers, while also improving the end customer experience. Since May of this year, the company has already on-boarded 3500 users across the country.
AlleyWatch caught up with CoverForce CEO and Cofounder Cyrus Karai to learn more about the business, the company’s strategic plans, round of funding, and much, much more…
Who were your investors and how much did you raise?
$5M in Seed funding, led by Nyca Partners with participation from QED Investors, Muir Capital, Sidekick Partners, and Moving Capital.
Tell us about the product or service that CoverForce offers.
CoverForce’s full product suite includes:
Commercial Insurance API: Streamlines integration in days while connecting to multiple carriers for instant access to appetite, quotes, proposals and policy documents while enabling one-click binding.
Quote & Bind Agent Portal: Syncs directly into top carrier systems to grant access to appetite guide while enabling instant quote, bind, payment, and issue.
Wholesaler/Network Management Portal: Tracks submissions across all Agent Portals, completes binds requested by retail agencies and showcases placement analytics across all agencies.
Direct-to-consumer online storefronts: Creates a white-labeled online shopping experience for business owners to choose products and get competitive quotes from multiple carriers.
What inspired the start of CoverForce?
After listening to the experiences of friends and relatives that work in the insurance industry, we recognized a demand from independent agents – a group whose voices and specific needs had been neglected historically.
Thus, CoverForce was born out of desire to strengthen independent agents throughout the US, where many insurtech companies were created to disintermediate them. We leverage our understanding of the insurance landscape and engineering best practices to help agents and carriers communicate more efficiently.
How is CoverForce different?
CoverForce has many differentiators that set us apart from our competitors, including:
CoverForce is the first independent insurance platform – not a registered agency or broker – to build infrastructure that provides streamlined API access to the leading commercial insurance carriers for instant quote and one-click bind.
Our mission is to strengthen independent agents, not disintermediate them.
CoverForce’s investment in infrastructure is helping bring standardization to the entire industry, where carrier APIs are disparate for SME commercial products like workers’ compensation, business owners policy (BOP), general liability, and cyber.
CoverForce provides an API that is easy to integrate, which cuts the time to integrate with a leading carrier from months to weeks.
CoverForce’s API helps carriers and their preferred distribution partners – appointed agencies and software applications – to build solutions faster. It can embed onto any software application and website for an easy-to-use commercial shopping experience for agencies and business owners.
CoverForce also builds customized software solutions that are co-developed with carriers to cater to the needs of large networks and wholesaler groups. Because of this customer-centric approach, CoverForce powers the second largest network of independent agencies – ISU Insurance Agency Network.
CoverForce is cofounded by myself, senior insurance executive Behram Dinshaw (former EVP of Small & Middle Market Centers at Travelers), and former Amazon engineer, Kaivan Wadia. Together, we’ve established an expert leadership team that brings extensive tech experience and deep insurance knowledge together with industry experts, from Google, The Hartford, Travelers, Allstate Corporation, McKinsey & Company, and more, to build technology that seamlessly integrates into established processes of carriers, agents, and wholesalers.
CoverForce is built to high system and data security standards, and in cooperation with carriers to ensure carrier quote & bind APIs are only accessible with their consent.
What market does CoverForce target and how big is it?
CoverForce targets the $300B Commercial Lines market.
Target users are: insurance agency networks, brokerage groups, wholesalers, and big corporations enable embedded digital submissions, quotes, and binding experiences.
What’s your business model?
CoverForce charges a flat SAAS fee for access to its unified API.
CoverForce charges fees to build customized software for large agency and wholesale clients.
How are you preparing for a potential economic slowdown?
We are partnered with carriers, networks, and wholesalers to rollout software that specifically addresses regulatory compliance issues, as such we focus on solutions that are required in the market.
We also build specifically for customer demands/needs.
What was the funding process like?
We raised funds in early 2022 and chose our investors based on their passion for the insurance space and commitment to building meaningful infrastructure that would help existing participants to connect digitally.
What are the biggest challenges that you faced while raising capital?
Insurance-tech has historically been neglected in venture capital markets, due to the perceived complexity of the industry dynamics.
Finding investors that are passionate about building for public good and comfortable with operating in a regulatory complex environment was important to us.
What factors about your business led your investors to write the check?
I think it was our team – we are one of the first insurance-tech companies that combined senior-level insurance executives from legacy carriers like The Hartford and Travelers, with leading engineers from companies like Google and Amazon.
We are also filling a needed gap for an independent market participant that helps carriers amplify their digital channel growth with agents – our mission is to strengthen independent agents, not disintermediate them.
I think it was our team – we are one of the first insurance-tech companies that combined senior-level insurance executives from legacy carriers like The Hartford and Travelers, with leading engineers from companies like Google and Amazon.
We are also filling a needed gap for an independent market participant that helps carriers amplify their digital channel growth with agents – our mission is to strengthen independent agents, not disintermediate them.
What are the milestones you plan to achieve in the next six months?
In the next six months, we plan to achieve:
A continuation of the momentous growth we’ve seen onboarding users in 2023.
The continued development of our close partnerships with top-tier insurance carriers – with a focus on expanding the products they offer digitally to their appointed agents and distribution partners.
Developing new carrier and agency relationships, as we offer greater optionality to both market participants, whilst helping increase volumes.
Growth of our Engineer and Customer Success teams, to make sure we build faster and our growing user base is supported.
A potential Series A funding round.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
We found success by approaching large customers, listening to them, and building solutions for their needs. We also met with different parts of the value chain to understand the current industry capabilities. This has enabled us to deliver solutions that are both customer-centric and, most importantly, can be executed upon.
Where do you see the company going now over the near term?
We are focused on working with select insurance agency groups and carriers to improve the ease of doing business for their agents and small business customers. There are plenty of these customers, and we want to take our time to engage with them and listen to their needs.
What’s your favorite fall destination in and around the city?
Madison Square Park. It has a great dog park and a Shake Shack – two things that put a smile on my face as the weather turns.
