New-age insurtech startup upcover raises 4.7 million in seed funding

Skye Theodorou and Anish Sinha, Co-founders of upcover

upcover announced it has secured $2.7 million equity and $2m debt in a $4.7m seed round. With backing from industry heavyweights, the trailblazing insurtech startup is simplifying, digitising and democratising a heavily regulated industry that has been stagnant for years.

What is the market offering of upcover?

The insurance tech platform partners with market-leading insurers — including products underwritten by ProRisk under an authority to bind cover on behalf of Swiss Re — to serve up quick, jargon-free insurance tailored to the needs of SMBs and sole traders. By using a single insurance API (application programming interface) to connect with insurers, upcover provides quotes by asking just two questions, a feat no insurer on the market can claim.

Cofounded by Skye Theodorou and Anish Sinha, upcover launched its API first, embedded SMB insurance platform in 2021. Within eight months, the team has seen huge traction:

  • Growing 20% MoM on insurance premiums & policies underwritten.
  • 5,000+ SMBs, sole traders and independent contractors registered
  • Four new products launched, backed by three large insurance & reinsurance companies

upcover’s key driver of growth is its work pioneering Australia’s first SMB embedded offering. upcover’s platform agiley integrates with online businesses (e.g rideshare firms, online marketplaces, and fintechs), making it seamless for trusted brands to monetise their existing client base and independent contractor workforce by offering affordable insurance solutions.

Insurtech is an untapped and emerging market in Australia’s startup ecosystem. Last year, investment in the insurtech space was reported at $15.8bn, in Australia only $100-$250m venture dollars, and a fraction of this into the SMB commercial insurance sector.

What were the investors’ thoughts on upcover?

upcover’s $4.7M seed round was backed by venture funds Antler Australia, and Betterlabs, and a industry leaders; Patricia Priest, GM, LMI QBE, Raf Uy, CFO global fintech, Etika, Raf Niesten, CEO Bricks + Agent, and Colin Morgan, ex-CEO Global Life APAC, Zurich Insurance.

“upcover is BetterLabs’ first investment into the Aussie insurtech space – the caliber of the team, their business model and traction they have gained in the market to date present a fantastic opportunity. We are very excited to now journey with them as they scale their business off the back of their recent seed round,” said James Edwards, CEO of Betterlabs.

“As my first startup investment, I am delighted to be backing this great team and a female founder too. Coming from a background in financial services, it’s inspiring to see the new ideas that upcover is bringing to the table,” said Patricia Priest, General Manager, LMI, QBE.

“upcover is led by an exceptional founding team and we have been an enduring supporter since their very first round. We believe they are building towards a huge insurtech opportunity,” commented Bede Moore, Managing Partner at Antler Asia Pacific.

What were the executives’ thoughts on the funding?

Sinha said, “SMB insurance is a $320 billion industry globally, and it’s valued at $10bn in AU with four incumbents controlling 80% of the market. upcover is democratising the ecosystem by allowing any business, brand or online marketplace to become distributors of insurance policies and in the process allowing them to monetise their customer base.”

“By making insurance policies programmatically accessible, we’ve opened up the ecosystem, so that brands can embed an insurance checkout within their brands user experience.”

After working for over a decade in the insurance industry, Theodorou knows first-hand that it’s a sector in need of a shake-up and she’s excited to see what the future of insurtech looks like in Australia as the startup space continues to gain more traction from investors.

“The journey of building upcover has been an incredible ride. Our clients love the experience we offer, we know we are onto something unique. To be backed by some of the best in the insurance and banking business has been an incredible way to close out our seed fundraise. The insurance industry has long been plagued by convoluted questionnaires, overcomplicated terms, and lengthy quote timeframes and upcover is changing all of this,” said Theodorou.

upcover plans to inject the capital into product development and customer acquisition, to help more SMBs and sole traders access hassle-free, easy to understand insurance policies.