The insurtech hopes to close the $58bn flood protection gap
Parametric insurance insurtech FloodFlash has today (10 February 2022) confirmed a series A funding round of $15m (£11m), which it plans to use to fuel international expansion to the US, Germany, Australia and Japan.
The funding round was led by investment firm Buoyant Ventures, alongside San Francisco-based Munich Re Ventures, the strategic corporate venture capital group of Munich Re.
Other firms included in the funding round include Tokyo-based Sony Financial Ventures, Japanense firm Global Brain, San Francisco-based MS&AD Ventures and PropTech1 Ventures, located in Berlin.
The insurtech’s existing investors - Pentech, Local Globe and Insurtech Gateway - also participated in the funding round.
FloodFlash, which specialises in commercial flood insurance, hopes to close the $58bn flood protection gap.
Its chief executive 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.”
Hitting the US market
The insurtech believes that the US represents its next biggest opportunity - for example, government agency the National Oceanic and Atmospheric Administration (NOAA) has found that inland flooding alone caused more than $151bn in damages across the US in the last 40 years.
Despite this prevalence of flood risk in America, only 5% to 15% of homeowners - and fewer than 5% of SMEs - have flood insurance.
FloodFlash, which launched in 2019, provides parametric-based commercial flood insurance that utilises computer models, cloud software and connected technology.
When setting up cover, policyholders are able to choose at what depth of flooding they wish to receive a claim payout, as well as select how much compensation they wish to receive. This means that when local flooding occurs and reaches the predetermined depth, FloodFlash will pay out the set claim amount - typically within 48 hours.
Amy Francetic, managing director of Buoyant Ventures, said: “Real solutions are needed to address flood risk in the communities on the frontlines of climate change.
“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.”