Root

There has been no official response from Root, but Inside P&C took a look at the company reportedly making the takeover bid, Embedded Insurance.

Inside P&C’s morning summary of the key stories to get you up to speed fast.

This would be a premium to Root’s closing price on Tuesday of $6.02 per share, which gives the company a market value just north of $80mn, significantly below its peak of roughly $7.5bn.

InsurTechs are still the most heavily shorted among P&C names, though they likely have been beneficiaries of a short squeeze for most of 2023.

InsurTech carriers pivot to profitability vs growth.

The company is seeing high single-digit loss cost trends, so the carrier will file for rate ‘even in states where we at target’.

The InsurTech slashed its operating loss by 59% year on year to $29.8mn, as gross loss ratio narrowed by 12.6 points to 71.5%.

Root’s challenges generate lessons for other InsurTechs, as its stock value crash leads to a management exodus, and the banking collapse dries up funding needed to balance cash burn.

Recent data shows an increase in InsurTech short interest and a slight uptick for brokers and P&C insurers as a result of economic uncertainty following the banking crisis.

Binkley previously served as deputy CFO, chief accounting officer and principal accounting officer.

Lemonade and Root both reported strong Q4 results, but will need to execute plans to near-perfection to turn things around.

Inside P&C’s morning summary of the key stories to get you up to speed fast.