The maker of an online quiz that prods marathoners and weightlifters about their exercise habits is the latest beneficiary of Silicon Valleyâs ardor for the insurance industry.
Behind the quiz is Health IQ Insurance Services Inc. The firm uses information fromÂ individualsâ answersÂ to then offerÂ themÂ discounted life insuranceÂ if it determines theyÂ live healthy lifestyles. On Wednesday, the firm said it raised $55 million in growth capital from a group of investors, bringing its total capital raised to $140 million.
The deal values the six-year-old company led by Chief Executive Munjal Shah at about $450 million, according to people familiar with the matter.
The Mountain View, Calif.-based startup doesnât offer insuranceÂ directly. Instead, it works with insurance carriers to identify runners, cyclists and other health-conscious individuals that it says have lower risks of early death. Applicants who want to save money on term life insurance policies have to pass Health IQâs online test of health literacy and prove their fitness level.
The company said that it has written around $21 billion in coverage in the past three years.
Other insurance-focused startups are raising big sums from investors, betting that the future of the industry will be more about slick websites and smartphone apps than brigades of sales agents. Venture capitalists poured $1.57 billion into insurance tech in the first quarter, according to research firm CB Insights. That is double the amount they invested in the same period of 2018.
Big checks are being written to unproven companies in nearly every category of the industry. Prolific startup investor SoftBank Group Corp. led a $300 million investment round in April for Lemonade Insurance Co., which sells renters and homeowners policies online. Clover Health Inc., a San Francisco startup that sells Medicare Advantage health-insurance plans to seniors, raised $500 million in January.
Health IQâs investors include specialists in both insurance and software, such as the technology-investing arm of Aquiline Capital Partners and venture-capital firms Greenspring Associates and Andreessen Horowitz.
Aquiline is run by Jeff Greenberg, a longtime insurance executive and the son of former American International Group Inc. CEO Maurice R. âHankâ Greenberg.
Share Your Thoughts
Would you take up running or cycling if it meant you could save money on life insurance? Join the conversation below.