TheNextRoundUp Venture Capital Blog Features Black Bear Life
Life Insurance Made Easy I with Black Bear Life Co-Founders
While many InsurTech companies have recently
emerged to make the industry more efficient, the life
insurance experience still leaves the stakeholders asking
themselves, “what’s changed?” Brett Smith and Tim
Stoner, veterans of the industry with a combined 40+
years of experience, decided it no longer needs to be the
The co-founders decided to start Brooklyn-based Black
Bear Life in February of 2018 and plan to officially
launch by Q1 of 2020. Black Bear Life is an “actual
insurance company” not a company that sells insurance
products of legacy carriers like the current startups.
Black Bear Life believes that creating a company from
the ground up was the only way to renovate this archaic
industry because the fragmented solutions we are
seeing today are not the answer. They are a cloud-based
company that is implementing the best of breed SaaS,
big data, AI, and predictive analytic solutions to improve
the business model and most importantly, the customer
experience. Black Bear Life offers an intuitive customer
experience where they answer as few as 17 questions
and purchase a policy within 10 minutes.
I had the pleasure of speaking with Black Bear Life cofounders,
Brett Smith and Tim Stoner, on what they’re
Q: What is the inspiration for starting Black Bear Life?
Brett: After experiencing and seeing many of the
shortfalls that have plagued the industry for decades, it
was obvious this industry needed someone to integrate
technology and innovation to improve the business. In a
recent industry study, McKinsey said it best, “The
opportunity is great for an innovator to establish the next
generation life insurance company”. They go on to state
that “the winners will be those that move decisively” and
that there is a ‘winner-takes-all’ effect where the vast
majority of the profits from innovation could be gathered
by one player.
Q: In your own words, what does Black Bear Life offer?
Brett: Black Bear Life is the only insurance company that
is built with proven technologies from the ground up,
issuing 100% of our policies in as little as 10 minutes.
Typically, it takes 8 weeks to get a policy issued, and
requires blood tests and medical exams – it’s an
unpleasant and arduous process. We are a cloud-based
company that uses analytics, third-party data sources,
predictive risk modeling and the latest SaaS solutions to
provide over 85% overhead cost reduction over legacy
life insurance companies.
Q: What differentiates Black Bear Life from other
Tim: The three main benefits we have are:
1. We are the only company that is built to immediately
issue 100% of our policies.
2. We are the only startup who is engineered to distribute
both direct to consumer and through broker channels.
Recent studies have shown that the number one thing
consumers look for when they are buying life insurance is
understanding the process through the guidance of a
licensed professional, because it's an area they don't
understand, and they want to make sure they obtain the
correct coverage. We will be concentrating on
distributing our products through broker channels where
over 90% of all policies are sold today.
3. Currently, the startups in this space are sales and
marketing companies, not life insurance carriers, so they
are unable to implement any real innovations
themselves. Black Bear Life is a Life Insurance Carrier,
designing and underwriting our own products. Because
we have everything automated with new technologies,
we’re very agile and able to maximize operational
efficiencies. Our underwriting process alone yields us a
95% cost savings and we carry similar saving through
every part of the business.
Q: What is the market opportunity?
Tim: The term life insurance market has 4.1 million new
policies issued every year, which translates to $1.2 trillion
annually of new coverage. The total addressable market
is $140 billion dollars annually in renewable premiums.
There is also a $12 trillion coverage gap consisting of
people who are lacking coverage and those who are
Q: How is your technology different than other
InsurTech companies out there?
Tim: A good analogy of what we’re doing is how Apple
built the iPhone. Apple doesn’t manufacture all the
individual pieces like the chip and the screen – they
purchase these parts from the best manufacturers – and
then design it and put together a superior product. We
believe the insurance industry would benefit by operating
in this fashion. Creating a next-gen company with the
best solutions, suppliers, and specialists to create
superior products that are delivered with an intuitive
Q: How are you able to make a decision on life insurance
so quickly, when on average it takes 8 weeks?
Brett: Our secret sauce is our predictive risk modeling.
Our customers start by answering 17 questions and we
simultaneously access third party data sources to build
an individual risk profile. This allows us to be the industry
leader by having a single pricing for each policy. Typically,
policies are priced before and after they go through the
risk modeling. This results in most cases having their
price significantly increased over the initially quoted price.
Q: What is your go-to-market strategy?
Tim: We have the ability to market to D2C but our focus
will be distributing through broker channels and
independent agent networks where 90% of all policies are
Q: What are you currently working on achieving in the
next 6 months?
Brett: We are working on relationships with national
brokerages and getting licensed in 50 states. The
infrastructure is ready to go!
Q: What is your fundraising status?
Tim: We are currently self-funded and are in the process
of raising a Seed/Series A. It’s important for us to find the
right strategic partners who understand the market
opportunity and share our vision.