Canadian embedded insurance startup Walnut raises $3mn

Canadian embedded insurance startup Walnut Insurance has raised nearly US$3mn in a seed round co-led by the National Bank of Canada's VC investing arm

Canadian embedded insurance startup Walnut Insurance has announced a CA$4mn (US$2.9mn) seed round led jointly by ATB Financial and the corporate venture capital arm of National Bank of Canada.

The embedded insurance pioneer, which is based in Toronto, is trying to remove traditional barriers to firms incorporating insurance experiences into existing digital channels. They say it will provide brands with the opportunity to “build deeper relationships with customers and expand their revenue streams”.

Walnut provides the core infrastructure and access to a broad set of insurance products that can be embedded into or alongside consumer experiences, much like embedded payment and lending. With their API-driven distribution approach, Walnut has partnered with Neo Financial, one of the largest fintechs in Canada, to help the company tap into the CA$160bn (US$117bn) Canadian insurance market.

Walnut ‘creating meaningful value for millions of people’

Derek Szeto, Co-Founder and CEO of Walnut Insurance, says: “Our seed raise is a testament to the continuing revolution inside the insurance industry. We are empowering partners to be able to offer innovative insurance products to millions of customers without the need for years of heavy investment or diversion of significant resources from other ongoing priorities. Embedded insurance is predicted to be a US$3tn dollar market and Walnut is well positioned to be a leader in this industry.”

“We're excited to be partnering with the team at Walnut, and to be a part of building a modern insurance infrastructure that can provide more meaningful and relevant insurance journeys to our consumers,” says Andrew Chau, Co-Founder and CEO of Neo Financial. “We see this partnership as a means of more deeply engaging with our users, through a modern and convenient version of a process that has historically been time-consuming and laborious.”

And James Povitz, Principal at NAventures, which is the VC investing arm of National Bank of Canada, continues: “The insurance industry is ready for disruption and Walnut has built a powerful platform that will close the coverage gaps and create meaningful value for millions of people. The partnerships and distribution channels Walnut has been able to acquire at this stage of their business is impressive and speaks to the need that Walnut’s fintech infrastructure is solving for partners and clients.”

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