The 1926 Model A is a far cry from the self-driving Tesla we see on the road today. The automotive industry has progressed light years since Henry Ford first paved the way for automobiles. From refrigerators to cars, technology is moving at warp speed. There’s just one industry that hasn’t quite kept up with the Joneses: the insurance industry. For over one hundred years, the $1 trillion industry has stayed pretty constant — consumers purchase a policy from an agent, pay their premiums and really don’t think twice about it. These four startups from Silicon Valley, New York City, etc. are about to turn the insurance world upside down. And, if you ask us, it’s about time.
Mojio— Some may remember Mojio as a “connected car” hard- and software company, but the brand recently went through a major overhaul. With a seasoned startup CEO on their hands, Mojio looked at industry trends and discovered a major hole and an opportunity for change. They plan to roll out their new business model in North America sometime this fall, in conjunction with the revamped AutoMobility LA, the first smart car technology trade show of its kind. With their new model, Mojio hopes to create an automotive ecosystem where the automotive industry, insurance industry and telecom services thrive together. While staying mum about their North American partnerships, Kyle MacDonald, head of marketing had this to say:
“This open approach enables the owner of the car to become the owner of his or her data. Novel? Yes, but we believe this is simply the logical evolution of car ownership. As software continues to eat the world, startups like Mojio are poised to take a big bite out of the connected car market.”
Needless to say, your connected car is about to get a whole lot better. Mojio has been experimenting with their new model oversees with wild success. In an article posted on the Mojio blog, CEO Kyle Hawk said, “Deutsche Telekom and ZTE are turning to partners like Mojio to provide the platform for global, scalable connected car offerings, signaling an exciting time for not only the automotive and mobile industries, but ultimately for end users who’ll soon be able to enjoy a new era of car ownership and driving experiences.”
CoverHound— CoverHound is built for one-stop shoppers. With the wild success of things like Amazon’s 1-click ordering, consumers are used to comparing and purchasing things in one place. Why not apply this philosophy to the insurance world? The brilliant minds behind CoverHound are doing just that. With $33.3 million in their series C round seed funding, this San Francisco startup is everything you would imagine. With urban chic offices and a mass of young professionals with immense potential, this start up is poised to rocket to even more success. They’ve already clobbered over similar sites like the now-defunct Leaky, and they’ve just secured a new round of investors. With this, they plan to take on business insurance coverage for small startups. CoverHound board member James D. Robinson III said, “The industry is ripe for change, CoverHound paves the way into the next generation of insurance.” They’re not just relying on a great user experience website; CoverHound allows potential customers to tweet at them for quotes, capitalizing on high traffic social media. With these innovative business practices, CoverHound will be the new way to get insurance as technology continues to push on.
Trov— Insurance isn’t just about cars.; what about your house and all your belongings? There is nothing worse than coming home to a ransacked home and discovering that all your valuables have been stolen. Panic sets in. Did I pay my premiums this month? Will my renter’s insurance cover the cost of my bike? Do I even have proof of all my valuables? Trov solves all of these in one glorious mobile app. The brilliant minds behind Trov thought pretty critically about the behaviors of millennials before designing the platform Trov is built on. Insurance companies of the past have two fatal errors. The first is they don’t account for the fact that today’s consumer is far from stagnant and that moving every two years is commonplace. Home insurance policies for 30-plus years just aren’t happening anymore. The second, and perhaps the more frustrating, is claims. Insurance giants intentionally make the claims process difficult to discourage you from filing them. Trov solves it all with its cloud-based insurance app that — with a few swipes, photos and texts — you can catalog, insure and file a claim right from your phone. It’s a dream come true when it comes to insuring your valuables without the hassle. Right now, Trov is only available in Australia, but this Bay Area-based company plans to launch in the U.S. by 2017.
Lemonade— For a company that has yet to launch after receiving one of the highest amounts in first-round seed funding, Lemonade is getting a lot of press. Claims like, “We aim to be the Facebook of insurance” are pretty bold, but we would be lying if we said we weren’t intrigued. Lemonade is a peer-to-peer insurance company. To put it simply, a group of small policyholders pay their premiums into a pool to pay claims. If there is still money left in the pool at the end of the period, the group gets money back. The company is backed by notable investors Sequoia and Aleph Capital and has brought on AIG and ACE veterans execs. A simple search of “Lemonade insurance” and you’ll find article after article of its “plans” to launch. As the end of 2016 creeps closer and closer, we can’t help but wonder what’s going on behind the hot pink doors. With a concept that’s yet to be tested in the American market, Lemonade has potential — but, then again, good press doesn’t last forever.
Fast forward to 2017, and this list could be entirely different. That’s the beauty of startups: they’re constantly pushing boundaries. All of it is good news for the customer, who desires a better experience when it comes to their insurance policies. Giants such as State Farm and Progressive will have to rely on more than just clever marketing spokespeople to keep up with the tech trends. These four startups are already causing some mayhem of their own in the industry. With a piece of a $1 trillion pie at stake, it’s surprising it has taken this long for the shakeup.
This article first appeared on obrella.com.