Laka, a London-based insurtech startup that offers what it calls “crowd insurance” has successfully raised $4.7 million in a new funding round led by early-stage VC firms LocalGlobe and Creandum with support from several angel investors.
The funding will be used to drive expansion in Europe starting with a launch in the Netherlands in the first half of 2020.
Founded in 2017, by Ben Allen, Jens Hartwig and Tobias Taupitz, Laka has developed what it claims is a unique insurance model for the upper end of the cycling market, that sees customers share insurance costs.
Unlike traditional insurance, customers share insurance costs between them only paying for the true cost of their insurance cover, with the individual’s maximum premium capped at the “market rate”. Meaning, if there is no claim, the premium for that month is zero, or if there are claims then the maximum rate an individual will pay is the market rate proportionate to the value of their insured equipment.
To date, the startup says it has saved customers more than 80 percent compared to traditional insurance rates and todate has more than 5,000 cyclists already insured by it's service across the UK.
Currently all of Laka’s insurance policies are backed by Zurich, and its claims team is based in-house.
In a statement by Tobi Taupitz, CEO of Laka: “Cyclists should be able to completely trust their insurance providers and through our community-based approach we are bringing our customers, many of whom have previously been ill-served by legacy players, a product that ensures fair treatment, trustability and transparency."