Covera’s digital insurance solution has raised a $1 million seed round to grow their insurtech startup.
The latest seed round was led by Ferst Capital Partners with participation from fintech angel investors and brings Covera’s total capital to $1.5 million. The Montreal-based company expects subsequent closings to add an additional $500,000 by November, powering the new company with $2 million in funding.
Covera leverages technology to find customers optimal insurance rates every year, competing with traditional insurance firms who issue automated annual renewals to 80 per cent of insured Canadians.
“No one should be allowing their insurance to automatically renew — there are almost always benefits to shopping around,” said CEO Scott Loong. “Covera provides everyday Canadians with a non-conflicted and technology-first approach to improving their mobility in the market.”
Loong said instead of renewing insurance, Covera handles insurance re-shopping for customers and claims they can provide the “best value” in the market. The company uses data and proprietary algorithms to gain insights into a client and find home or auto insurance alternatives. That’s something that piqued the interest of Ferst Capital Partners.
“Covera is using a unique go-to-market strategy by targeting the insurance renewals space. Ferst Capital Partners is proud to be leading this investment in an industry that has gained global traction whereby Canada has lagged behind,” said Dominique Ferst, managing partner at Ferst Capital Partners.
The insurtech’s services are free for customers as Covera earns revenue through broker commissions paid by insurance carriers.
The digital insurance brokerage is currently only available in Quebec, but plans to expand Canada-wide after obtaining the necessary licenses. Covera outlined two additional areas they’re channelling the new capital, including growing both users and their team to speed up product development.