Blueprint Title Raises $16M Series B Funding

Blueprint Title Secures $16 Million Series B Funding

Blueprint Title, an insurtech company specializing in title insurance, has announced the successful completion of a $16 million Series B funding round. Forté Ventures led the investment. Previously, the company secured $8.5 million in Series A funding during late 2019.

A Distinct Approach to Insurtech

While categorized as an insurtech startup, Blueprint distinguishes itself from other companies in the neoinsurance sector. Unlike firms like Roots, MetroMiles, and Hippo that went public through traditional IPOs or SPACs, Blueprint primarily serves business clients and offers a different type of product.

The majority of neoinsurance companies target individual consumers. Conversely, Blueprint focuses on providing a superior title insurance experience to professional organizations, as stated by CEO Steve Berneman in a recent interview with TechCrunch.

Unique Market Dynamics and Loss Profile

This focus on business customers results in distinct go-to-market strategies and a significantly different loss profile compared to consumer-facing insurtech companies.

Title insurance, according to Berneman, typically has a claims rate between 1% and 4%, which is considerably lower than that of auto insurance. This lower risk profile influences pricing flexibility; optimizing cost and service delivery becomes paramount in title insurance underwriting due to limited potential for loss ratio adjustments.

Market Concentration and Potential for Disruption

Berneman notes that the U.S. title insurance market is dominated by four companies controlling approximately 90% of the market share. Due to regulations mandating public pricing in many states, pricing alignment exists among key players.

Consequently, Berneman believes the $18 billion title insurance market could realistically be a $10 billion market, suggesting a degree of current mispricing.

Anticipated Growth and Strategic Acquisition

Blueprint projects a substantial 400% revenue increase in 2021 compared to 2020, which fueled its recent funding round and likely contributed to a valuation increase.

The company also announced the acquisition of Southwest Land Title Insurance Company, an underwriting firm. Berneman explained that achieving more reasonable pricing and shrinking the title insurance market requires a full-stack approach – both underwriting and selling coverage directly – to prevent margin erosion.

B2B Insurance as a Lucrative Opportunity

Like Next Insurance, Blueprint represents a venture capital bet on the profitability of selling insurance to businesses. Given the shifting investor sentiment towards consumer-focused neoinsurance companies, the growth and eventual public debut of this B2B-focused cohort will be closely watched.