Ethos,
a start-up that says it can process life insurance applications in a matter of
minutes, has raised $35 million in a funding round led by Accel and backed by Google's venture capital arm.
The latest investment raises the San
Francisco-based company's total funding to over $46 million, and CNBC
understands the firm is now valued at more than $100 million.
The deal, which marks Ethos' second major
round of investment, sees Accel Partner Nate Niparko join the firm's board of
directors, while Google Ventures General Partner Tyson Clark will act as an
advisor to the board.
Existing investors Sequoia Capital and
Arrive, the venture fund of U.S. rapper Jay Z's entertainment
firm Roc Nation, also participated in the funding round.
"The insurance sector is a $1 trillion
industry that is still largely dependent on pen and paper, pushy salespeople,
doctor office visits, and legacy systems, which is why we believe there is a
tremendous opportunity to simplify the process through technology — and that's
exactly what Ethos has built," Accel's Niparko told CNBC in an email.
He highlighted other bets the firm has made
on insurance technology start-ups like Shift Technology, which uses artificial
intelligence to detect fraudulent insurance claims, and The Zebra, a car
insurance marketplace.
"We believe that Ethos is the first
player in the life insurance space that's truly poised to make a difference in
how Americans purchase and interact with their insurance provider," Niparko
added.
Ethos,
which uses data analytics to predict a person's life expectancy, says it is
able to cut the time normally taken to apply for life insurance policies from
10 weeks to just 10 minutes, and that insurance claims are paid out
"within weeks." It also claims that more than 99 percent of its
customers don't require a medical exam or blood test in order to get a policy.
It provides term life insurance coverage,
which lasts between 10 and 30 years. Ethos says this model is primarily
targeted at people who are in the "prime" of their life, who are less
likely to think about applying for life insurance.
The firm is partnered with century-old
insurers Assurity Life Insurance Company and Munich Re to help it deliver insurance products
to customers.
It's a relatively little-known name in
Silicon Valley, but Ethos has drawn the attention of some big-name investors.
Just four months ago, the company raised $11.5 million in its first major round of
investment, led by Sequoia Capital. The round was also backed by Robert Downey
Jr.'s Downey Ventures and Will Smith's family
office Smith Family Circle.
Ethos said it saw "robust growth"
this year, with a more than 400 percent jump in revenue, customers and
applications in the last four months alone.
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