Austin — One of the biggest promises of the Internet is its ability to make clear obscure corners of the marketplace. The Zebra, an Austin, TX startup, has set its sights on the murky confines of the insurance industry.
“From early on, the goal was the simplify insurance,” says Adam Lyons, Zebra’s founder and CEO. “I was getting all these questions from family and friends on insurance, how it works, what it covers. It should be black and white: like a zebra.”
Lyons formerly worked at Lloyds of London, evaluating and underwriting policies, hence the queries from his social circle. “Everyone would ask, Hey, I got into an accident, what should I do?’ ” he says. “I thought, wow, there’s a huge opportunity to educate consumers and build a platform for them that would do this.”
So, in 2012, Lyons founded The Zebra, a website where consumers can enter basic information—a car’s make, model, and year, as well as a zip code—and receive in 90 seconds the best insurance matches selected from among 3,000 products. The company, which recently raised $17 million from investors such as New York’s Daher Capital, Silverton Partners in Austin, and Dallas Mavericks owner Mark Cuban, is working on a mobile app for the service.
The Zebra is one of a handful of companies—including an effort by Google—looking at leveraging technology to demystify the insurance industry, as my colleague Jeff Engel wrote last month.
The market is a ripe one. Lyons says that nearly half of Americans shopped for car insurance in 2014. Websites like The Zebra likely encourage more to do so.
Once a user engages with the website, a Zebra employee will contact the person asking for more information, such as credit score and accident history, which also affect policy rates. (Except in California, where, Lyons says, it is illegal to factor in credit history for insurance purposes.)
Zebra is a licensed insurance agency, and it has employees who are licensed to act as brokers in each state. In some cases, the Zebra fulfills the policy and takes the standard commission. Otherwise, it refers the consumer to the insurance company and takes a cut of 10 percent to 20 percent, Lyons says.
Lyons says his experience within the industry gives The Zebra its edge. “Insurance is a complex product—it’s not just buying shoes. … If you get (policies) wrong, they’re on the hook for millions of dollars,” he says.
The upside for insurance companies, Lyons says, is that The Zebra can connect them to customers they wouldn’t ordinarily reach. Despite the industry’s stodgy reputation, “a lot of insurance companies are excited and eager to engage,” he says.
