Elpha Secure Technology Inc has raised $20mn in capital in a Series A funding round which will be used to enhance the startup’s cyber insurance services.
The New York-based startup which combines proprietary cybersecurity software with coverage to improve risk transfer, secured the funding with help from lead investor Canapi Ventures, a venture capital firm investing in early to growth-stage fintech companies.
The capital was also raised by Elpha Secure’s existing investors which include Stone Point Ventures, AXIS Capital, State Farm Ventures, The Hartford STAG Ventures, Fermat Capital Management, and EOS Venture Partners.
New cyber insurance solutions
According to reports, Elpha Secure provides a groundbreaking cyber protection solution for small and midsize businesses that marries proprietary cybersecurity technology with insurance policies.
The firm differentiates itself from the conventional cyber insurance model, because it provides end-to-end, proprietary solutions. These help customers reduce cybersecurity risk via an approach that focuses on limiting coverage or raising rates.
A statement issued by the provider, confirms that Elpha Secure’s offerings result in insureds gaining enhanced coverage with a single software installation that, “brings greater cyber protection through security controls like encrypted data backups, multi-factor authentication for remote desktop connections, software version control, and machine learning to detect anomalies and advise specific action.”
New technologies for cyber insurance are emerging
Elpha Secure says its team of in-house experts has created a streamlined portal experience to eliminate friction in the insurance quoting, binding, and renewal process.
This, it says, means the team provides users with support for all of their cybersecurity needs throughout the life of the policy. Furthermore, customer employees can also improve and maintain their organisation’s cyber health, which shrinks the attack surface and reduces the chance of an insurance claim. This is carried out through Elpha Secure’s centralised suite of security controls on its intuitive platform.
The insurtech’s cyber insurance product is backed by two industry-leading insurance carriers, AXIS Surplus Insurance Company and Everest Indemnity Insurance Company.
Enhanced cyber insurance services through investment funding
Elpha Secure confirmed the additional funding round will help drive business growth across broker networks and evolve te insurtech’s product features to better equip small and midsize businesses to defend against cyberattacks and their consequences with end-to-end protection and response.
Reports suggest that the rate of cyber attacks against SMEs in 2021 in the US increased by 31% compared with the previous year, which has driven market demand for better cyber insurance services in the marketplace.
Speaking about the latest funding round, Preetam Dutta, CEO of Elpha Secure said, “We are humbled by the great investors supporting Elpha Secure and we are thrilled to welcome Canapi as a new partner. Digital threats are growing in variety, frequency, and intensity, so cyber insurance is becoming indispensable.”
He explained that smaller businesses struggle to have the adequate cyberinfrastructure to qualify for insurance and that this market service shortfall has led to business owners defining and implementing the required cybersecurity measures themselves.
“We provide these measures through our software as well as the insurance policy,” Dutta said. “We’re only just getting started, and we look forward to expanding our reach and serving even more businesses in need in the years to come.”
SMEs at greater risk of cyber attack than ever before
Jeffrey Reitman, Partner at Canapi Ventures, agreed with this viewpoint. He said, “Today’s small and midsized businesses are not only at a greater risk than ever of suffering a cyberattack, but they also face significant hurdles when it comes to acquiring cyber insurance policies.”
Reitman said that by embedding security controls directly into their policies, Elpha Secure removes the friction associated with acquiring a cyber insurance policy, while also controlling loss ratios for their carrier partners. “In offering an unprecedented solution that newly combines both cyber protection software and insurance, Elpha Secure greatly reduces the cyber risks in the system for all. We’re so excited to be leading this Series A and look forward to helping fuel the company’s growth into the future.”