Embedded insurance is becoming increasingly popular, with more e-commerce customers expecting the option to insure their airline flight or concert tickets at the point of sale.
Oyster, a NYC startup formed last year, has developed a platform that allows customers to purchase personal insurance for other valuable e-commerce purchases, such as jewelry, e-bikes, collectibles and electronics.
The startup announced Tuesday that it launched from stealth with a $3.6 million seed round led by New Stack Ventures. The round was joined by Global Founders Capital, Conversion Capital, Cambrian Ventures and other investors.
Oyster currently has seven employees, three of which are based in NYC. Oyster CEO and co-founder Vic Yeh told Built In via email that the company will use a portion of its seed funding to hire several new employees.
While Oyster has started with a focus on jewelry, e-bikes, electronics and collectibles, Yeh said the company eventually plans to venture into additional industries.
“Some of our target categories in the future include new insurance products for personal property and experiences,” he said. “Our goal is to be the go-to solution for any business looking to seamlessly integrate personalized insurance at their point of sale.”
Oyster said it only takes 20 minutes for e-commerce businesses to install its no-code technology and generate instant insurance quotes for customers.
While homeowners and renters insurance provides some coverage for these items, Oyster argues such policies often have low coverage limits, high deductibles and coverage gaps for items that are lost or accidentally damaged.
With Oyster, users can insure a $5,000 ring for as little as $50 per year, including full coverage from theft, loss and accidental damage.
“You can buy a $5,000 e-bike or engagement ring online in just a few clicks and get it delivered the next day. Want to get insurance for that purchase? Good luck. It’s an offline process that can take many days and lots of paperwork,” Rex Salisbury, a founding partner at Cambrian Ventures, said in a statement. “Oyster is offering embedded insurance for high growth, e-commerce categories to allow consumers to seamlessly insure some of their most important possessions at point of sale in a few minutes. It’s a huge opportunity to move personal insurance into the digital age.”
