The Israeli Insurtech startup Vesttoo that has been operating under the radar finally emerges from the shadows with a funding round led by Axon Fund, REDDS Capital, and a number of Angel investors from around the world. Furthermore, American company MultiStrat leverages the Israeli startup’s technology for a $55 million casualty ILS transaction.
Significantly lowering the premium
Vesttoo has developed technology for the risk management market, which insurance companies and their subsidiaries can leverage to transfer actuarial risks to the capital market. The Israeli startup’s AI-based technology performs quality and objective risk assessment to provide insurers with a strategic risk management solution at a low cost that offers them on-the-spot capital relief.
The Israeli Insurtech company CEO and co-founder explained in a conversation with Geektime that “Vesttoo utilizes machine-learning models to assess distributions and probabilities in order to quantify future payments for selected insurance portfolios - unlike standard insurance companies that use more traditional models. Vesttoo also developed further models that actually replace the manual entry of the actuary, which is a standard practice that has remained the same without change for many years.”
The startup specializes in insurance risk assessment, however, doesn’t carry the risk itself. The risks are sold to institutional investors who in return receive high-yield investments that aren’t influenced by, or correlated to the volatility of the stock market. Furthermore, the company’s platform enables pension funds and insurance companies to safeguard their insurance risks at low costs.
Vesttoo was founded in 2018 by Alon Lifshitz, Yaniv Bertele, and Ben Zickel after the three attempted to find a long term solution for transferring risks while making advanced financial tools more accessible as an alternative investment for the public. The company currently employs 10 people at its Tel Aviv headquarters. The company denied specifying the investment amount but did note that it’s “a few million dollars.”
In parallel, as previously mentioned, Vesttoo closed a $55 million stop-loss deal with the Californian insurance company MultiStrat, which should further add millions of dollars into Vesttoo’s pocket.