He only raises $ 8 million in his effort to beat Root in the auto insurance game – TechCrunch

Just make sure, a pay-per-mile insurance technology company, has 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 it uses telematics “to reward safe drivers and reduce insurer bias” by looking at factors like how, when and where customers drive, rather than factors like zip code or marital status, as most traditional insurers do. Or put more simply, it charges customers only for the miles traveled and its rates vary based on driving behavior. In this way, Just says it can offer lower rates for “safer drivers” and claims to save its clients about 40% over their “old auto insurance company.” For now, it is only available in Arizona, although the company plans to expand into 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 car insurance. There is Metromile, which launched its custom pay-per-mile auto insurance in 2012. And also Root insurance, an Ohio-based auto insurance company that uses smartphonew technology to understand individual driver behavior. Although there are similarities between Root and Just, there are also clear differences, according to founder and CEO Robert Smithson.

Root charges customers a monthly fee, and when policies are renewed, the fee is subject to change based on driving behavior. It only has a similar model. If your drivers exhibit safe driving behavior, your rates may drop. On the other hand, if they exhibit dangerous behavior, their rates may go up. But unlike Root, Smithson said, Just only charges its customers “sole responsibility” for miles traveled. There is no monthly fee. For “full coverage” customers, Just also includes a “small daily charge” to reflect the risk of someone stealing your car. For its part, MetroMile charges customers a base rate plus a rate per mile. Neither rate is affected by how a person drives, Smithson notes.

“The [Just] The price per mile that a customer receives may change each month. This means that we can quickly reward safe drivers with lower rates and increase them for those who drive worse, ”Smithson said. “This quick feedback loop encourages people to make smarter driving decisions. And it means that our clients have fewer accidents and we do better. “

In 2020, Root had a 82% direct loss ratio. Just’s direct loss ratio is 65.8% so far this year. But of course you have far fewer customers and only serve one market. Still, the The company says it has already achieved underwriting profitability in terms of the portion of the premium it pays on claims.

Plus, with so many people moving to work from home in the last year, Just says he has seen an increase in demand this year. It issued more than 1,000 new policies in the second quarter, a “ten times greater” increase compared to for the same period in 2020. The startup said that during that same time, its revenue increased 1,400% compared to the second quarter of 2020.

“People are just driving less as a result of higher work-from-home rates, and this is not going to change anytime soon,” Smithson said. “Our approach allows us to offer customers rates that truly reflect the way they drive.”

The company compares its user experience to that of a prepaid calling card. Only customers can “charge” their account for $ 30 for minimal liability coverage and $ 75 for full coverage to start driving. Of the company 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 that Matt Kinley, ManchesterStory’s co-founder and managing partner, has never seen before.

“It’s fairer, more affordable and personalized across the board, and unique in that the company offers customers rates that actually reflect their driving, which rewards safe drivers with lower insurance premiums,” he said.

The company plans to use its new capital in part to do some hires (it currently has a staff of 35) and expand its product offering. It is also planning to launch beyond Arizona into neighboring states. In particular, Smithson said the startup is “eager” to launch in Texas.


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