Farmers Insurance subsidiary Toggle Insurance Company has replaced Munich Re as the reinsurer to renters insurance start-up Jetty.
The New York-based insurtech platform announced on Wednesday that it had entered into a new deal with Toggle, under which the Farmers’ subsidiary will become the exclusive reinsurance provider for all of the new policies written under Jetty’s core deposit and renters insurance offerings.
Jetty was launched in 2017 by co-founders Mike Rudoy and Luke Cohler, and effectively operates as an MGA on behalf of its reinsurer.
It uses paper from fronting carrier State National through its AM Best A rated National Specialty Insurance Company, and had been reinsured by Munich Re since it started writing business.
However, since the middle of this month, Munich Re has been replaced as Jetty’s reinsurer by Toggle.
“This is an important and really exciting new collaboration for Jetty, and is a major vote of confidence in the strength of our products and the depth and quality of our real estate distribution channel,” said Rudoy.
“In addition to its brand equity and robust balance sheet, a key factor in our working with Farmers was our shared vision around innovation and disruption in the financial services space, as evidenced by their startup brand, Toggle.
“Working together, we’ll be able to quickly deliver even more value to our real estate partners, as well as to the renters who are the ultimate consumers of our products.”
In its most recent funding round, a Series B in February 2019, Jetty raised $25mn led by Keith Rhabois of Khosla Ventures. It has raised $40.5mn overall, across three funding rounds.
Following the announcement of the new reinsurance partnership, Stephanie Lloyd, head of new ventures for Farmers and president of the company’s Toggle brand, said Jetty “is one of the first companies to shake up the outdated deposit alternative insurance market, and they have a truly compelling vision for the future”.
Described as “a new millennial-centric brand” upon its launch in 2018, Toggle offers customers the opportunity to personalise their coverage by “toggling” certain elements of their policy up and down. The product was initially launched in October 2018 in the states of Illinois and Wisconsin, but is now available in 25 states including Arizona, California, Kansas, Michigan, Pennsylvania, Texas and Virginia, among others.
Covid-19 moratorium short-lived
Back in April, The Insurer reported that Jetty had imposed a moratorium on writing new business as the company and its reinsurer sought to protect the insurtech’s balance sheet from any potential Covid-19 related fallout. The moratorium was introduced on 31 March and was lifted on 14 April.
Back in early April, Jetty also cut some 40 percent of its staff, a move which took its headcount down from 90 to 55. As Jetty told this publication at the time, the move was made to preserve the long-term health of the business as it deals with the implications of the Covid-19 pandemic.