Mexico and Puerto Rico
Press Release

Raincoat Raises $4.5M Seed Round To Introduce Climate Disaster Insurance For A New Era

Bnamericas Published: Tuesday, August 02, 2022

Press release from Raincoat

SAN JUAN, PUERTO RICO. AUGUST 2, 2022 - Raincoat, a startup developing a full suite of scalable climate insurance solutions that enable instantly processed individual claims, announced today that it raised a $4.5 million seed round. The funding round was led by leading insure-tech investor Anthemis and includes the backing of SoftBank Group’s SB Opportunity Fund, Puerto Rican banking leader Banco Popular, Chilean financial group Consorcio, Miami-based 305 Ventures, and New York-based investor Divergent Capital.

Building upon the concept of parametric insurance – with its ultra-streamlined policy design and payout mechanisms – Raincoat’s climate insurance solutions aim to provide financial institutions, governments, and insurers automated, end-to-end products for protecting individuals and small businesses affected by natural disasters like hurricanes, earthquakes, and floods. With its highly experienced team of scientists, engineers and insurance experts, Raincoat develops the infrastructure and capabilities needed to deliver a scalable and automated climate insurance solution that companies and public entities can offer to those who need to be covered and protected in the face of a natural disaster.

Heralded as a potential solution to the inherent inefficiencies of traditional insurance policies, parametric insurance insures a policyholder against the occurrence of a specific event given fixed and transparent parameters, such as the magnitude of the event instead of the magnitude of losses incurred.

“While fully-automated insurance holds the key to insuring the most vulnerable against ever-more frequent climate disasters, the obstacles to fully implement these programs at scale are incredibly complex. Our team hands off an end to end, fully operational, tailor-made solution that can be embedded in our partner’s existing channels, facilitating their claim response to end users” expressed Jonathan González, co-founder and CEO of Raincoat. “We gather all industry and local regulations, capacity, science, data and software development to deliver an automated parametric insurance product that covers all the stages of a policy lifecycle.”

Partnering, for example, with financial institutions and insurers to help attach climate insurance coverage to traditional products, or with governments seeking to eliminate inefficiencies in the payout process for citizens in the aftermath of climate disasters, Raincoat’s full stack approach sets it apart in the burgeoning parametric space. Their products aim to enable scalable end-to-end parametric climate disaster insurance programs, helping promote global climate adaptation and eliminating a persistent global coverage gap.

“Time and again the world has watched vulnerable populations left with little recourse in the wake of climate disasters,” added Ruth Foxe Blader, partner at Anthemis. “We’re excited to support

Raincoat’s cutting-edge solution to secure those at risk from disasters that will unfortunately become more and more common.”

“Raincoat’s solutions may very well hold the key to unlocking scalable parametric insurance concepts, ensuring the livelihoods of those most vulnerable to natural disasters and helping to bring urgent relief where it’s needed the most,” said Chad Harris of the SB Opportunity Fund. “We are excited to back them as they continue to expand their offerings globally.”

Raincoat was founded in response to the aftermath of Hurricane María, which struck Puerto Rico in 2017, leaving thousands of homes and businesses severely damaged and millions without power and water for months. Residents, including the founders of Raincoat, were left to wait on a slow and cumbersome claims process to find out if they’d receive a payout. Even after an extended period most claims were denied, and 3 years later there were still $1.6 billion in unpaid insurance claims on the island alone.

Currently, Raincoat is working with international reinsurers and governments worldwide to protect farmers and individuals from catastrophic weather conditions that affect their businesses. Likewise, the startup has active corporate projects in Puerto Rico, Jamaica, Mexico, and Colombia. With this funding round, Raincoat seeks to expand its services worldwide, providing a solution for the over 3 billion people and 120 million businesses at risk of being affected by natural disasters. Raincoat’s solutions have been used for wide-scale deployments such as the Tripartite IDF project in Mexico, whose participants include the government of Mexico, the UNDP, AXA, Guy Carpenter, Swiss Re, and Munich Re. Raincoat seeks to provide a new generation of parametric insurance at scale, protecting people from the over 850 climate disasters occurring yearly and vastly reducing the resulting unanswered claims.

About Raincoat

As natural disasters grow more frequent and more destructive, Raincoat develops white label climate insurance products enabling a new generation of parametric insurance at scale. Operating within the burgeoning space of parametrics, Raincoat's uniquely B2B2C approach enables individual policies offered via partnerships with insurers, financial institutions, and governments. Creating highly-scalable climate insurance products, Raincoat aims to democratize financial resilience in the face of cataclysmic disasters. For those in need, its technology ensures instantly processed claims triggering payments that cover not just property damage but lost income. For more information visit: www.getraincoat.com.

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