Root
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Root’s improved results make it an attractive acquisition, not a comeback story.
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The InsurTech’s shares gained over 50% in value on Thursday.
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The price movement came amid a tech stock rally on Wall Street.
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The company posted favorable development in the last quarter of 2023.
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The Insurance Insider US news team runs you through the earnings results for the day.
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“We're certainly not banking on inflation abating at this moment in time,” Alex Timm told analysts.
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The Inside P&C news team runs you through the earnings results for the day.
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On the surface, InsurTech results were better than the noise from incumbents, but caution is needed to ascertain the quality of new business coming in during a time when even industry leaders stumble.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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In the quarter, Root saw its auto policies in force shrink 31.5% to 203,840, though they were up slightly from 199,685 policies in Q1 2023.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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The Inside P&C news team runs you through the earnings results for the day.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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The announcement follows reports that Root has filed a lawsuit against Embedded related to the violation of a non-disclosure agreement.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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The suit is related to the violation of a non-disclosure agreement between the parties.
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“Tomorrow will be a better day.” “Next year will be a better year.” “The coming decade will be when this industry realizes its true potential.” We hear the same for most public enterprises.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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There has been no official response from Root, but Inside P&C took a look at the company reportedly making the takeover bid, Embedded Insurance.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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This would be a premium to Root’s closing price on Tuesday of $6.02 per share, which gives the company a market value just north of $80mn, significantly below its peak of roughly $7.5bn.
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InsurTechs are still the most heavily shorted among P&C names, though they likely have been beneficiaries of a short squeeze for most of 2023.
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InsurTech carriers pivot to profitability vs growth.
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The company is seeing high single-digit loss cost trends, so the carrier will file for rate ‘even in states where we at target’.
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The InsurTech slashed its operating loss by 59% year on year to $29.8mn, as gross loss ratio narrowed by 12.6 points to 71.5%.
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Root’s challenges generate lessons for other InsurTechs, as its stock value crash leads to a management exodus, and the banking collapse dries up funding needed to balance cash burn.
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Recent data shows an increase in InsurTech short interest and a slight uptick for brokers and P&C insurers as a result of economic uncertainty following the banking crisis.
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Binkley previously served as deputy CFO, chief accounting officer and principal accounting officer.
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Lemonade and Root both reported strong Q4 results, but will need to execute plans to near-perfection to turn things around.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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The executive also stepped down from the InsurTech’s board of directors on Monday.
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The move follows the carrier’s 30-point improvement in its combined ratio to 101.4% after markets yesterday.
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Inside P&C’s news team runs you through the key highlights of the week.
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CFO Rob Bateman said that loss ratio improvements and adjustments around cost structure will work to bring the cash burn down.
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Embedded partner Carvana accounted for 41% of new writings in Q4 2022, plateauing from 38% in Q3 2022 and 27% in Q2 2022.
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The InsurTech is accusing Brinson Caleb Silver and his alleged co-conspirators of executing a scheme which defrauded it of at least $9.4mn.
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On December 30, the company announced launching an investigation into a series of transactions made by a former senior employee in 2022.
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2022 marked a reversal from last year’s unprecedented levels of global investment in InsurTech as the macroeconomic scenario flipped and investors put lossmaking companies under a magnifying glass.
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Inside P&C’s news team runs you through the key highlights of the week.
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Though Carvana’s financial situation might cause InsurTechs to think twice about an embedded partnership, the auto dealer’s woes could lead to an easing of loss cost pressures for personal auto insurers.
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Media reports said a group of Carvana’s 10 biggest lenders holding around $4bn of the company's unsecured debt have made a three-month pact to act together in the case of restructuring.
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InsurTechs’ mounting losses and continuing cash burn combined with reinsurance market hardening could spell trouble for the sector.
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Our Trump/Biden note from yesterday discussed the rotation from growth stocks to value stocks playing out over 2022. Unfortunately, insurance technology stocks have had it the worst, with Lemonade stock down 49%, but still doing relatively better than Root (down 86%) and Hippo (down 80%).
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The CEO added that Root was in a “very conservative stance” with its loss trend assumption, as the actual numbers seen right now were lower.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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The company reported a 56.8% improvement YoY in its operating losses along with a 33% decline in auto policies in force.
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As ITC Vegas begins, the Inside P&C Research team explores the discussions needed among InsurTechs to address questions around capital, partnerships, and profitability prospects.
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Odyssey Group’s cyber chief Robert O’Connell is looking to raise up to $1bn of capital for a monoline cyber reinsurer.
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The InsurTechs’ results show the path to profitability remains unclear, even as Lemonade said it expects to be self-funding from here.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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The InsurTech will carry its current strategy to prioritize profitability over top line growth through the second half of the year, according to executives during the conference call.
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The Insurtech narrowed its loss ratio despite multiple inflationary pressures in the personal auto sector.
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The executive discussed InsurTech challenges, his priorities for Branch, fundraising, and his concerns about the capital markets.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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The sector was hit by a rough first half of 2022, with more to come in the second half of the year.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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The CEO of one of Europe’s largest online pharmacies will serve on the company’s audit, risk and finance committee to fill the seat of recently departed director Elliot Geidt.
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Embedded insurance can help sidestep some of the challenges faced by InsurTech 1.0.
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Companies that had easily lured investors with major premium growth are now scrambling to prove their fundamentals work, and are sitting out fundraising to avoid a down round.
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The personal auto writer’s partnership with the digital dealership should serve as a warning for other InsurTechs.
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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The executive, currently managing director of VC firm Redpoint Ventures, was a member of the firm’s board since 2018.
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The company aggressively moved to reduce capital consumption, tighten its underwriting and take rate action in the first quarter of 2022.
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Root implemented 18 rate increases year-to-date with a weighted average rate of roughly 19%.
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March’s CPI report shows elevated inflation levels, including vehicle CPI of 10.5% and average used car price increase of 24.7%.
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Following the acquisitions of Trov and Insureon, what InsurTech M&A deals are next?
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Inside P&C’s morning summary of the key stories to get you up to speed fast.
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The executive joins the Ohio-based InsurTech after a year at Ategrity, where he served as president and CFO.
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Insurance carriers tailor their comments to leave investors walking away with an optimistic view.
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Birnbaum’s experience spans more than 20 years in product, business operations, sales, marketing and strategy at companies such as GrubHub and Expedia.
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Inside P&C’s news team runs you through the key developments from the past week.
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