An insurtech start-up which specialises in commercial properties at risk of flooding has raised £1.9 million in seed funding.
FloodFlash has developed a technology-led approach that makes flood insurance available to everyone, including those with the highest flood risk.
A policy pays out a pre-agreed, fixed sum as soon as a pre-defined level of flooding occurs. The flood triggers an internet-connected water-sensor and the payment is made immediately to the policy holder.
“Every year tens of thousands of business owners lose their livelihoods because they have been unable to take out an affordable policy that protects their business,” said co-founder Adam Rimmer.
“In the immediate aftermath of a catastrophic flood, people care less about dollar-for-dollar reimbursement for damages and more about whether their business will survive at all.
“We want to make the world more resilient to catastrophic events and we believe FloodFlash’s event-based insurance is absolutely the best way for insurers to cover higher-risk areas.”
Co-founder Ian Bartholomew added: “The efficiencies in the technology that we have developed make FloodFlash policies available to those who need it most. The FloodFlash sensor and high-resolution pricing algorithms are essential parts of that.
“We think that by pricing risk in this way, and by promising instant settlement, we can help to resolve what is arguably the largest market failure in insurance.”
The £1.9 million seed investment came from LocalGlobe, Pentech Ventures and InsurTech Gateway.
FloodFlash is currently carrying out a live pilot for its policies with a select group of SMEs in parts of the UK with significant flood risk, including Carlisle.
The start-up has been working as part of the InsurTech Gateway incubator since mid-2017. It currently employs five people but expects to double that number over the next six months, as it prepares for product launch in October.
Stephen Brittain, co-founder and director of InsurTech Gateway, said: “FloodFlash has designed a product that will revolutionise the sale of flood insurance in this country and around the world.
“We are delighted to have had the opportunity to fast-track the company through the early stages of concept definition and funding rounds to ready it for scaling.”