"More than 80% of the insurance consumers are under-served. They pay a substantial premium year after year, play by the rules, live a responsible and community friendly life, and almost never submit claims," said Halos Insurance founder & chief executive Satadru Sengupta. "This low-risk group has fundamentally different needs compared to the group that submits claims frequently. We are using the latest technologies and going back to first principles to design products for low-risk groups and reduce accidents for certain high-risk groups." According to the Insurance Information Institute (III), between 2010-2015, annually only 6% of insured homes filed claims. This number is similar for auto insurance. On the other hand, more than 70% of the premium collected is spent on claims and claims related expenses - up to 15% of which is fraud. According to the Federal Bureau of Investigation (FBI), insurance fraud costs the average U.S. family between $400 and $700 per year in the form of increased premium. Today, once a customer is acquired, almost all monetary and operational resources are spent on claims and claims related expenses including fraud, leaving a large segment of consumers questioning the value of insurance.
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