Zego, a London-based pay-as-you go insurance provider, has closed a ?6m Series A round led by Balderton Capital.
The round also featured participation from?existing backers, including LocalGlobe and unnamed angel investors in the insurance sector.?Zego raised ?1.2m in seed funding from LocalGlobe earlier this year.
Founded by former Deliveroo managers in 2016, Zego provides specialist pay-as-you-go insurance to delivery drivers using cars and scooters for food delivery. It is looking to fill the gap created by platform businesses such as Deliveroo, Quipup, Uber and Uber Eats, which do not consider their workers to be employed.
All of its insurance products are based on the principle that drivers should pay only for the hours that they are actually driving the car, van or scooter. All car, motorbike and scooter drivers are required by law to be insured for the periods that they are delivering.
Rob Moffat, partner at Balderton Capital, said: ?At Balderton we have been looking in depth at tech companies in insurance over the last few years. Zego really stood out with their innovative insurance products solving a major problem for drivers.
?They are in a new and fast evolving market that traditional insurers find it hard to adapt to. We were blown away by the execution speed of Harry, Sten, Stu and team and their ambitious plan to offer a wider suite of insurance products that resolve many of the problems gig economy workers face.p>
The new funding will be used to hire more specialists for its engineering team, as well as staff to build key business functions. It is also on the verge of launching a suite of insurance products for self-employed people, including those working in the so-called gig economy, along with looking to expand internationally.
More than $1bn has been invested in global InsurTech so far this year according to data by FinTech global. Earlier this month, cyber insurance startup At-Bay collected $6m in a Lightspeed-led round. While, Oxford Capital led a ?3m funding round for UK-based insurance app.
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