WASHINGTON — The Demex Group, a risk analytics and intelligence company that facilitates innovative stop-loss reinsurance protection, has raised $10.25 million through a Series A and previously closed SAFE funding round, led by Congruent Ventures and included Moxxie Ventures, MetaProp, and existing investor Blue Bear Capital.
Demex delivers an innovative parametric reinsurance solution for losses due to severe convective storms – which includes tornadoes, thunderstorms, hail and wind – which have become far more frequent due to climate change, enabling insurers to protect their financial security. In partnership with reinsurance brokers and reinsurance companies, Demex arranges coverage for losses above a specified threshold. This model is resonating with customers as well as investors with $65M of reinsurance bound in the first selling season.
“Growing losses from these storms are a critical problem for the insurance industry – challenging insurance companies’ annual earnings and balance sheet surpluses. We’re grateful to have investors who bring climate perspective, technology capabilities, a property mindset, and insurance experience to Demex,” said Bill Clark, President and CEO of Demex.
“Insurance carriers are taking significant losses from high frequency events such as thunderstorms and have been digging into their surpluses for years,” said Abe Yokell, Co-Founder and Managing Partner of Congruent Ventures who led the round. “Reinsurers, too, have experienced higher than expected losses due to secondary perils. The Demex model – developed by a blue-chip team from industry heavyweights – quantifies risk and reduces deviation, which broadens reinsurance offerings and ultimately provides a stronger insurance industry for property owners.”
“Higher frequency extreme weather events, like severe convective storms, now cause more damage than the catastrophic events that are addressed by traditional reinsurance,” said Hank Hattemer, Chief Operating Officer of Blue Bear Capital. “Each Demex insurer customer gets a reinsurance product that is precisely calibrated to how those weather events affect its business, tuned based on its own data. No other reinsurance product that I’m aware of works like this – it is a fundamentally new product and the market response has been overwhelmingly positive.”
The investors participating in the funding round come from a range of different sectors. Congruent Ventures is one of the largest early stage investors in climate solutions, Blue Bear Capital invests in high-growth technology companies across the energy, infrastructure, and climate industries, Moxxie Ventures is a Silicon Valley based seed-stage firm that invests across sectors and MetaProp is a property technology investor specializing in real estate and the built environment.
