Assurance IQ, through a combination of advanced data science and human expertise, matches buyers with customised solutions for life, health, Medicare and auto insurance


Assurance IQ to be acquired by Prudential Financial (Credit: Derek Jensen (Tysto)/Wikimedia Commons)

Prudential Financial has agreed to acquire US-based health and life insurtech company Assurance IQ in a deal worth up to $3.5bn (£2.84bn).

As per the deal terms, Assurance will receive an upfront payment of $2.35bn (£1.91bn), and be entitled to an additional earnout of up to $1.15bn (£930m) in cash and equity, based on achieving multi-year growth objectives.

How Assurance provides insurance solutions to its customers

The insurtech company combines advanced data science and human expertise to match buyers with tailored solutions for life, health, Medicare and auto insurance.

The insurance solutions can be bought completely online or through the assistance of a live agent equipped with technology.

Assurance’s model matches consumers with the live agent or specific sales process that is appropriate to their requirements — delivering better customer outcomes and higher levels of engagement and conversion.

According to Prudential Financial, Assurance’s approach is supported by a current shift in consumer preferences, where people are increasingly looking to research online before meeting experts to conclude their purchase.

The insurance giant said that Assurance’s technology-powered, on-demand service platform reduces the cost of customer acquisition, enabling deeper reach into the mass market without compromising service and product selection.

Prudential chairman and CEO Charles Lowrey said: “Assurance accelerates the strategy and growth potential of Prudential’s financial wellness businesses, bringing us closer to more people across the entire socio-economic spectrum to better serve the full picture of their needs.”

Assurance will add a direct-to-consumer channel to the financial wellness businesses of Prudential Financial, which is expected to expand the total addressable market of both the firms to a significant extent.

Prudential Financial also intends to offer its own financial wellness solutions on Assurance’s platform alongside those of third-party providers.

Assurance co-founder and CEO Michael Rowell said: “Prudential’s shared vision, coupled with the strength of its offering and capabilities, make it the ideal partner with which to begin our next chapter.

“We are excited to create an ecosystem that reaches more people and new markets with a more expansive suite of products to drive our combined growth.”

The transaction is likely to be wrapped up in the fourth quarter of 2019.