Breeze Raises $10M to Disrupt Disability Insurance

Addressing Accessibility in Disability Insurance

Having spent ten years working within the disability insurance sector, Colin Nabity observed that access to this crucial coverage was limited for many, largely due to its inherent complexity and challenging underwriting processes.

The Need for Income Protection

Disability insurance and critical illness insurance fundamentally serve as income protection mechanisms, safeguarding individuals when illness or injury prevents them from working. Approximately 5.6% of employed Americans experience a short-term disability annually, lasting six months or less, stemming from illness, injury, or pregnancy.

Furthermore, a significant portion of the population – one in four Americans – currently lives with a disability that impacts their daily lives.

Outdated Systems and a Gap in the Market

For over two decades, the sales model for disability insurance remained largely unchanged, relying on obsolete technology, data analysis, and underwriting methods. This often resulted in consumers receiving policies that weren't optimally suited to their specific occupation or health profile.

Notably, a direct-to-consumer digital platform for purchasing this type of insurance was absent, as highlighted by Nabity.

Introducing Breeze: A Digital Solution

In 2019, Colin Nabity and Cody Leach founded Breeze, based in Omaha, Nebraska, to address this market gap. Breeze empowers individuals to obtain a personalized quote for either disability or critical illness insurance by completing an online application in as little as ten minutes.

Differentiating Breeze from Established Players

While established companies like Aflac exist in this space, Breeze distinguishes itself through a fully digital approach to applications, quotes, and policy issuance. This provides consumers with financial protection against events such as cancer, heart attacks, strokes, and other medical conditions that could lead to income loss.

Market Overview and Breeze’s Approach

The U.S. disability insurance market was valued at $19.1 billion this year, according to IBIS World, and has experienced a slight decline since 2016. Breeze aims to revitalize these products by making them more affordable – with policies averaging around $20 per month for coverage costing several thousand dollars – and by enhancing consumer education to reduce apprehension surrounding the purchase process.

“Our goal is to simplify understanding of this insurance type, increase affordability, and enable a completely online purchasing experience,” Nabity explained to TechCrunch. “These health challenges can have devastating financial consequences for families.”

Securing Series A Funding

Breeze recently secured $10 million in Series A funding, led by Link Ventures. Nabity proudly states this represents the “largest initial institutional investment ever made in a Nebraska-based software startup.” Additional investors included Northwestern Mutual Future Ventures, Silicon Valley Bank, M25, Fiat Ventures, and Invest Nebraska.

Identifying Breeze’s Potential

Lisa Dolan, managing director at Link Ventures, discovered the company through web traffic analysis, noting Breeze’s prominence among industry leaders in consumer searches for disability insurance.

Dolan initially lacked familiarity with disability insurance but quickly recognized the market’s substantial size. She believes Breeze’s technological approach to connecting customers with appropriate insurance solutions allows it to reach individuals underserved by traditional insurance carriers.

Future Growth and Expansion

While Nabity did not disclose specific growth figures, he indicated that the new funding – the company’s first institutional capital – will be used to expand core products, integrate new carriers and agents into the platform, and bolster Breeze’s team in software development, customer service, and marketing.

“We are currently opening our platform to agents who haven’t previously sold these products, necessitating expansion of our product and support teams to manage the anticipated increase in volume,” he added.