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The Series E round will be led by new investors Coatue Management and DST Global, and all of Root’s existing investors also plan to participate, according to WSJ. Root currently has $177.5 million in funding, with its most recent round of $100 million raised last August.
Root uses a driver’s smartphone to gauge how well they drive, unlike traditional insurance companies, which take age, location, and how far you drive into account. Root’s smartphone app measures behaviors like braking, route regularity, and speed of turns to determine if someone is a “safe driver” and how much they should pay for insurance. Drivers can save up to 52 percent on their car insurance policy through Root, according to the company.
Root’s new round would be the single-largest funding round for a VC-backed insurance startup in 2019, followed by insurance startup Lemonade, which has raised $480 million.
Lemonade, like Root, uses artificial intelligence to determine premiums, but only offers renters and homeowners insurance.
Root earned $133.4 million in insurance premiums in the first half of 2019, according to WSJ, which was 12 times the amount it made in the same period last year. It also had $126.6 million in losses in the first half of the year, according to the report.