Sten Saar, CEO and Co-founder of Zego (centre).
Inside $1bn insurtech unicorn Zego: "We have no plans to slow down"
Zego, founded in London in 2016, hit a $1bn value last year, the first UK insurtech to reach Unicorn status, and is now targeting the European market.
“We have no plans to slow down,” the vice president of international at Zego, the insurtech with its eyes zeroing in on the £20bn plus European fleet insurance market, tells AltFi.
Zego, founded in London in 2016, hit a $1bn value last year, the first UK insurtech to reach Unicorn status.
It is a dramatic rise for a startup only set up in 2016, which now has over 600 employees and has raised over £200m in funding.
Insurtechs like Zego believe the motor insurance, like the banking industry, is ripe for disruption, with incumbents slow to adapt to new technological advances.
Zego, like Cuvva and Metromile in the US, is also tapping into societal shifts, like the rise in shared car ownership, changes to commuting, and the growth of the gig economy.
It offers commercial motor insurance for self-employed drivers and riders to businesses with entire fleets of vehicles, offering pay-as-you-go plans and annual policies.
The insurtech recently launched in the Netherlands and is ramping up its operations in France, while other European markets are on the horizon.
“It’s long been Zego’s ambition to be a global insurtech brand and our recent launch in the Netherlands is another important step in this journey and one that we’re very excited about,” Don McCormack, VP of International, tells AltFi.
“We now have a presence across multiple countries in Europe and we have no plans to slow down.
“At the moment our focus is on two areas: solidifying our presence and offering to customers in our existing markets; and finalising the markets we’d like to target for expansion in late 2022 so we can expand our global footprint.”
Zego also recently took its first steps into the world of food delivery insurance, which surged in popularity during Covid, offering two flexible insurance products for moped and e-bike fleets in the UK.
The first product is tailored to electric and traditional mopeds and is usage-based so companies only pay for it when they need it.
Firms will pay a base rate to ensure vehicles are covered at all times and Zego’s GPS partner ABAX will calculate how much distance the fleet covers.
Zego’s second product is a fixed-term annual policy for e-bike fleets that is priced per vehicle so companies will only pay for the vehicles in use.
Zego has existing relationships with several big-name delivery firms, including Deliveroo and Uber, helping it establish its position in delivery insurance.
“There are a number of exciting sub-sectors that are developing quickly and Zego is well-positioned to cater to this growth,” McCormack adds.
“Our longer-term ambition is to expand our offering in markets where we’re seeing greater demand for our services,” McCormack says.
Like many other UK fintechs, Zego currently runs a flexible working model.
Staff are entitled to a £1,000 a year allowance towards at-home work equipment and wellbeing, which can also be used for travel to work funding or other shared working space.
“The decision to adopt a full-time hybrid working model was largely the result of an internal survey that we ran. We found that the majority (91 per cent) of our staff value flexibility and choice when it comes to where they can work,” he said.
He says that Zego has made “a success” of remote working.
“We have enjoyed very healthy growth in the last 18 months. Flexibility is central to what we offer, which is why we have built our products to match customers’ evolving needs.
“This meant we were able to react quickly to the needs of our customers during the pandemic and continue to offer services to industries that could significantly benefit from flexible insurance amid the uncertainty.
“In some ways, we were busier than ever. Ultimately the product we offer is always going to be a priority for companies and has been a lifeline for many, particularly as households have become more reliant on deliveries during this time.”