US Flood MGA reThought Insurance raises $10.5 million

US MGA reThought Insurance, which is focused on US commercial flood risks, has raised more than  $10 million in a Series B funding round. 

The capital expansion, which follows a successful $15.5 million round last summer, will be used by reThought to extend the distribution of its commercial and High Net Worth flood insurance products, and to develop its technology platform.

Existing investors Telstra Ventures, Hudson Structured Capital Management, ArcTern Ventures were joined in the opportunity by the prominent InsurTech venture capital firm IA Capital Group, which led the round, and by an unnamed strategic investor. reThought was advised by Insurance Advisory Partners for the transactions. 

“Recent events have underscored the growing severity and ubiquity of flood risk, and the urgency of closing the flood protection gap,” said Matthew Perlman, partner at IA Capital. “As the contours of flood risk continue to change, we’re confident the reThought team will maintain and expand its edge as the most sophisticated flood underwriter in the market, and a high-performing partner to brokers and reinsurers.” 

Cory Isaacson, CEO and founder of rethought Insurance, says: “The continued support of our existing investor partners, alongside the welcome addition of new, highly experienced insurance venture capitalists is a powerful endorsement of our market-leading technological approach, especially now, when InsurTech funding is receding. The private market for US commercial flood insurance is set to grow exponentially.” 

reThought’s patent-pending ModelConvergence technology combines and assesses outputs from various vendor models, to produce a granular, proprietary, view of flood risk for every building in the United States. 

Each building in the US has been assigned a Flood Resilience Score between 1 and 1000, which shows how flood vulnerability may vary even between adjacent buildings. That allows risk-pricing which reflects the actual risk to ensure long-term capacity profitability and meet market demand. 

reThought’s claims its underwriting approach has delivered “exceptional” loss ratios for its capacity partners, despite recent major flood events including Hurricane Ian and the California storms earlier this month.