Financial services provider Fineqia has acquired additional stake of more than 20% in blockchain-based insurtech Black Insurance.
Image: Black Insurance founder Risto Rossar. Photo: Courtesy of Black Foundation OÜ.
This is the second time that Fineqia is investing in Black Insurance. Financial details about the transaction were not disclosed.
Founded in 2018 by Risto Rossar, Black Insurance plans to become a licenced insurer to enable underwriting of new insurance policies via insurance syndicates similar to the Lloyd’s market.
The insurance start-up said that its blockchain-based platform will help insurance brokers and agents in creating bespoke insurance schemes faster and cheaper.
Fineqia had participated in Black Insurance’s previous round of investment. The present investment will allow Fineqia to strengthen its portfolio of blockchain, fintech and cryptocurrency technology companies worldwide.
Fineqia CEO Bundeep Singh Rangar said: “Fineqia is pleased to have topped its original investment in Black in this most recent investment round.
“Black represents everything we want from issuers: innovation, disruption and ambition. And, we believe that insurance is one sector ripe for blockchain disruption and Black Insurance has the right team experience to make this happen.”
The company’s use of blockchain in insurance is aimed at reducing operational costs, increasing security and transparency, mitigating against any single point of failure and enhancing reputations for all parties involved.
By establishing a marketplace where investors and insurance underwriters can directly trade with one another, Black Insurance also seeks to minimise transaction costs.
Last year, Black Insurance announced plans to raise $5m (£3.9m) in ICO to fund the development and distribution of its technology. The company had already partnered with insurance players and secured commitments of $800,000 from VCs such as Concentric, BlackPearls, Fineqia and Siena as well as from insurance domain angel investors, including Risto Rossar and Bundeep Rangar.
The company said that 57 insurance brokers signed up to use its platform, totalling nearly $350m (£277m) worth of revenue per year. It claimed that by operating through its platform, these insurance brokers would be able to save$45m (£36m), compared to the admin costs in underwriting.