- London-based Peachy has raised $1.6 million for its health insurance platform.
- The startup tailors its digital platform to millennials and aims to expand its services to SMEs.
- Peachy tapped into a network of insurance execs to raise the fresh seed funding.
London-based Peachy launched in 2019 as an alternative benefits service to traditional private medical insurers (PMIs). It offers everything from outpatient consultations and therapies to dental and optical appointments; every product in its baseline plan also includes access to mental health cover and virtual GP consultations with UK-based health providers.
Peachy targets a market of 25 to 40-year-olds and small businesses. It views its digital-first approach and “simple product” that is free of medical forms and excessive information gathering as factors that distinguish itself from its industry peers.
Coverage starts at a base rate of under $11 (£10) per month. Rates then increase depending on the services that users want to pick as part of their plan, and their age and location, said Peachy’s cofounder and CEO Amit Patel.
“If you compare us to PMI incumbents, we’re much cheaper,” he added. “We bridge the gap between cash plans and traditional PMI.”
The startup doesn’t bill itself as an insurer, instead working with a Japanese insurance partner, which underwrites its products. It makes its money by taking a commission on the policies it sells via its digital platform.
Users can sign up to Peachy’s digital app, which showcases all the benefits and services available for reimbursement and receive a quote within minutes. Virtual consultations and appointments can be booked online, and claims can be made by sending a photo of the receipt, along with a video selfie, through the app. Hospital visits are reimbursed immediately, and claims are reimbursed for up to 16 weeks after a visit.
One of Peachy’s standout features is its no-commitment policy, which enables users to pay on a monthly basis and opt out instantly.
Having bootstrapped itself for three years, Peachy had already developed a product, secured an insurance partner, and was ready to launch by the time it approached fundraising — which made the process easier amid the global economic downturn.
The founders also chose to forego VC funding as they had a network of insurance executives to tap into, which they used to raise the seed round. Their backers included the likes of Dr Damien Marmion, ex-CEO of global insurance provider Axa Global Health, Eva Maria Barbosa, partner at global law firm Clyde and Co, and Sian Fisher, ex-CEO of the Chartered Institute of Insurers, among others .
With the COVID-19 pandemic pushing more people to adopt private healthcare, amid increased pressure on the UK’s National Health Service (NHS), Peachy had “an environment that was conducive to the product,” said Patel.
With the fresh funds, it will aim to exit the Regulatory Sandbox and look at launching its SME product, as it grows its headcount.
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