Insurtech startup Layr, which focuses on commercial insurance products for small businesses, has received a $150,000 investment from Lloyd’s Lab, the startup accelerator arm of global insurance marketplace Lloyd’s of London. This follows Layr’s acceptance and completion of the insurance giant’s three-month accelerator.
Layr was the only one of 10 startups in the accelerator’s first cohort to receive a subsequent investment. Though the investment amount has not been disclosed, Layr co-founder Andrew Egenes says the partnership will also enable the two companies to work together on new and unique products targeting their target audience.
Layr was founded by Egenes and former insurance traditional broker Philip Naples in 2016. The duo teamed up after Egenes, originally Naples’ client, fired him due to the tediousness of managing his insurance with a traditional brokerage.
Initially called Unbrokerage, the startup re-branded to Layr in early 2018 after refining the product and raising a small angel funding round.
“Entrepreneurs take on a lot of risk starting their companies, and we see ourselves as a critical layer of protection,” says Naples.
The AI-powered cloud platform automates the broker and underwriter process for small businesses seeking liability insurance. First, it helps the business owner assess and select the right coverage in an approximately 12-minute process, using a proprietary algorithm that predicts price and demand.
A comprehensive insurance package is issued to the business owner within 48 hours.
Once the business is insured, Layr’s online portal automates simple tasks like generating certificates of insurance and initiating claims. And all of it is paid for with one simple monthly fee that can be paid online with a credit card.
The startup currently insures hundreds of small businesses across 30 states, says Naples, which accounts for thousands of policies.
They feel validated in their model due to a very low attrition rate after three renewal cycles. The most common reason a business owner doesn’t renew, Naples says, is because the company has gone out of business.
To further their product and offerings, the Layr team applied and was accepted out of 300 applicants into the Lloyd’s Lab accelerator at the end of 2018.
Egenes says they were at first hesitant about the organization’s commitment to technology; founded in the mid-1600’s, Lloyd’s is not only the largest, but also the oldest insurance marketplace in the world.
Their fears proved unwarranted once they entered the accelerator program.
“One of the reasons we decided to take the investment [from Lloyd’s] was that the accelerator demonstrated that they truly are committed to modernization,” Egenes tells Hypepotamus. “They’re all in on supporting insurtech.”
Last week, the organization revealed a new strategy called “The Future of Lloyd’s” that outlines their commitment to exploring new technologies. The Layr team says their partnership is a part of that plan.
“Human brokers and brokerages just simply cannot make money on the amount of insurance premium that small businesses buy,” says Naples. “So they see our technology as unlocking this enormous market.”
While Layr will now distribute existing Lloyd’s products as part of its offerings, the team will also work towards creating exclusive, unique products that specifically benefit their small commercial customers.
While continuing to work toward client acquisition and product development, the Layr co-founders are in active conversations with seed investors for a roughly $2 million round.
They’re also hiring, planning to have about 15 on the Atlanta-based team by end of year.