Funding to capitalize international growth as company targets $58bn flood underinsurance problem
New York, NY, FEB 10, 2022 – FloodFlash, the parametric insurance technology company that pays catastrophic flood claims within 48 hours, today announced a Series A raise worth $15 million. The round was led by Chicago-based Buoyant Ventures with San Francisco fund Munich Re Ventures (MRV) featuring as an investor as well as commercial partner. Sony Financial Ventures/Global Brain (Tokyo), MS&AD Ventures (San Francisco) and PropTech1 (Berlin) are also participating in the round alongside existing investors Pentech and Local Globe.
The investment comes three months after FloodFlash announced a new insurance capacity partnership with Munich Re – the insurance arm of the group under which MRV also sits. FloodFlash plans to use the investment and capacity to fuel international expansion and begin closing the $58bn flood protection gap. Target markets include the US, Germany, Australia, and Japan.
The US represents the biggest opportunity. According to NOAA, inland flooding alone caused more than $151bn in damages across the US in the last 40 years. Despite the prevalence of flood risk in America, only 5% to 15% of homeowners, and fewer than 5% of small to mid-size businesses, carry flood insurance. This represents a massive opportunity for FloodFlash, who have already made an impact on the UK flood underinsurance problem.
Since launching in 2019, FloodFlash has established a track record for combatting extreme weather losses. Their unique coverage combines computer models, cloud software and internet-of-things technology to provide flood cover to those the insurance industry has left behind.
Aside from broader availability, a key advantage to the coverage is how simple it is. Customers choose a depth and payout amount for their policy. When flooding reaches the depth selected, the insurance pays out, typically within 48 hours. During Storm Christoph in January 2021 FloodFlash paid a client in full 9 hours and 44 minutes, setting a record for catastrophic flood claim payment.
FloodFlash CEO Adam Rimmer said “This investment is an endorsement of our parametric cover and how we’re using it to solve real-world issues. The group of investors for the round couldn’t be better tailored to supporting our efforts in solving the issues around underinsurance in the face of climate change.”
“Real solutions are needed to address flood risk in the communities on the front lines of climate change,” said Amy Francetic, partner, Buoyant Ventures. “We are thrilled to lead this first-class syndicate of investors and believe strongly that the FloodFlash team is well positioned for global expansion and success.”
“Parametric insurance is finally having its moment in insurtech and we believe the FloodFlash approach will appeal to hundreds of thousands of companies in the U.S. and beyond,” said Ben Bergsma, Investment Principal at Munich Re Ventures. “Successfully writing natural catastrophe parametric insurance is no simple task. FloodFlash’s holistic solution, which includes sophisticated building-level underwriting and monitoring as well as an intuitive cloud platform for brokers and agents, is a game changer that can operate at scale.”
Nikolas Samios, Managing Partner at PropTech1 Ventures said: “Constantly increasing climate-change induced risks are the dirty secret of the real estate industry. Everybody has them in her portfolio and regulation is getting tighter as we speak. Assessing these risks is therefore crucial for the build environment. FloodFlash has managed to develop a fast-growing business from that exact challenge. We are very excited to join the international consortium of investors and contribute the PropTech angle.”
Naoki Kamimaeda, Partner at Global Brain said: “We have witnessed more severe catastrophic disasters all over the world in recent years, made worse by climate change. The difficulty in estimating the damage caused by these disasters means that current insurance options are ineffective, unaffordable or full of uncertainty. FloodFlash has developed a unique parametric insurance product that serves the insurance needs of those most at risk. The FloodFlash approach is not only applicable in Europe and US but will be equally effective in Japan and Asia. We are very excited to join a group of global investors tacking climate change and look forward to helping FloodFlash to launch in Japan and Asia.