The number one goal of
"We do that through an online platform by making it both easier and a more modern experience," said Bobby Touran, CEO of Rainbow. "We also spend a lot of time thinking about how to use software to improve the underwriting of the policies because that can result in better value for business owners, less price for more coverage, if it can be more precise."
The three co-founders of the insurtech are all repeat founders. Jamie Hankinson, head of product, went to college with Touran, who was introduced to Shalom Yiblet, head of technology, through a mutual friend.
The company, which works directly with independent insurance agents, offers coverage that is available in Arizona, Texas, Michigan, Indiana and Utah. There are plans to add an additional 21 states over the next few months.
Hankinson said the entire Rainbow team enjoys visiting restaurants.
"We do that often as a team, we go out to restaurants once a week and love to think about the insurance side of the businesses that we visit," Hankinson added. "This happened right at the tail end of COVID-19 and restaurants were obviously a very affected class."
Rainbow is working to make the underwriting simpler and offers a pay-as-you-go payment plan, which allows the premium cost to fluctuate monthly based on business volume.
"If they have a good month and they have high sales, they may pay a bit more in premium. But if they have low sales because of seasonality or some downturn in the economy, they will pay less," said Hankinson. "Pay-as-you-go, as a structure, has been in the workers compensation space, which is a key coverage for restaurants. … Workers compensation is priced based on the payroll data that a business has and payroll data is generally readily available. Well business insurance, especially for restaurants, is a function of the business sales. Sales data is now becoming more and more readily available through point of sale systems and cloud accounting systems. We can now tap into those reports and those data points to change the price of our insurance policies every month."
Rainbow focused on its user experience and platform so its primary customers, insurance agents, experience an easy quoting and binding process.
"In restaurants, there are tons of classes. You could have an ice cream shop or you could have a fine dining restaurant, and dozens in between. So it can be hard for an agent to choose the right class and therefore get the right price for their client," Hankinson explained. "We use models in the background that take various data points that we collect, using third-party sources to classify the business in real-time against what the agent is choosing. And we can help them correct that."
Yiblet said insurance products are difficult to build but he expects that to become increasingly easier.
"When you look at insurance, compared to other markets, insurance is demonstrably way more difficult and I think that's something that people are working on to make it easier so that other entrants don't have to reinvent the wheel in order to be able to create core insurance products," Yiblet said.
