Raincoat

Raincoat develops technology for parametric climate insurance, supplying the infrastructure that connects insurers, reinsurers, distribution channels and end users. Its products are designed so that coverage is triggered by measurable event parameters — such as the magnitude of a hurricane, earthquake or flood — rather than by assessed losses, which allows claims to be processed and paid automatically without deductibles or a manual claims process. The company describes its platform as an operating system spanning scientific and catastrophe models, real-time environmental data feeds, reporting and integrations, embedded distribution, and the underlying IT infrastructure needed to run a policy through its full lifecycle.

The company works with financial institutions, governments and insurers to deploy end-to-end, tailor-made programs that partners embed in their existing channels, with the aim of protecting individuals, families, farmers and small businesses affected by natural disasters. Raincoat states its addressable need covers more than three billion people and 120 million businesses at risk from natural disasters, and it positions its offering as covering losses that traditional insurers typically exclude while delivering payouts faster than existing emergency relief mechanisms.

Founding story

Raincoat was founded in response to the aftermath of Hurricane María, which struck Puerto Rico in 2017, destroying thousands of homes and businesses and leaving millions without power and water for months. Local residents, including families of the co-founders, went through slow and bureaucratic claims processes and were often rejected months after filing; three years after the storm, $1.6 billion in insurance claims in Puerto Rico remained unpaid. The company was launched to bring a new generation of parametric insurance at scale to a region that experiences more than 850 weather disasters annually.

Business model

Raincoat operates as a business-to-business technology and program provider, building and operating automated parametric insurance products that partners — insurers, reinsurers, financial institutions, governments and other distributors — offer to their own customers and constituents through embedded distribution channels.

Traction

By June 2023, Raincoat reported that in less than a year it had provided disaster relief protection to thousands of individuals and families, with payments successfully executed in all of its active markets. Its solutions have been used in large-scale implementations including the Tripartite IDF project in Mexico, whose participants include the Mexican government, UNDP, AXA, Paribas Group, Guy Carpenter, Swiss Re and Munich Re.

Latest developments

In June 2023 Raincoat announced an additional $6.5 million seed round led by Two Sigma Ventures with Mundi Ventures, Revolution's Rise of the Rest Seed Fund and EleFund, earmarked for expansion into new markets to provide rapid, FEMA-like post-disaster payments across the Caribbean, Mexico, the Gulf Coast, the western United States, Colombia and Brazil.