Arbol Secures $60M Series B for Climate Risk Expansion
Arbol, a leading climate risk solutions provider, has successfully closed a $60 million Series B funding round. This significant investment was co-led by Giant Ventures and Opera Tech Ventures, with participation from Mubadala Capital. The funding will be instrumental in supporting Arbol’s continued expansion into agriculture and renewable energy through tailored products for new perils and geographies. Additionally, it will bolster the company’s global expansion and broaden its investment in property and casualty (P&C) and home insurance business lines in the U.S. and internationally.
Founded in 2018, Arbol has established itself as a pioneer in parametric risk transfer and climate and weather insurance/reinsurance solutions. The company has demonstrated remarkable growth, transacting $250 million in gross written premium in 2023, with significant advancements in its renewable energy and reinsurance businesses. Arbol Insurance Services, a wholly owned subsidiary of Arbol, became an approved Lloyd’s of London cover holder in May last year, further solidifying the company’s position in the industry.
Arbol recently announced the launch of Lilypad Insurance, a newly established carrier dedicated to serving the unique insurance needs of homeowners and property investors in coastal areas. Lilypad received its certificate of authority from Louisiana and has begun operations in the state. The company also announced the acquisition of Centauri Specialty Insurance Company and Centauri National Insurance Company, subject to regulatory approval. This strategic move will enable Arbol to grow the total addressable market of parametric insurance through hybrid product distribution while addressing the need for a growing coverage gap in coastal communities.
Sid Jha, Arbol’s founder and CEO, emphasized the significance of this funding round, stating, “This Series B funding marks a pivotal moment for Arbol, affirming our achievements and propelling our mission forward to normalize parametric financial products and insurance globally as key strategies in climate risk management. Our ambition extends from empowering the world’s smallest subsistence farmers in underserved regions to securing the assets of the world’s largest corporations, ensuring they all have access to unmatched protection amidst the unpredictability of climate change. Our approach is not just about offering insurance; it’s about creating a safety net that spans the entire spectrum of economic participants affected by climate volatility.”
Cameron McLain, Co-founder and Managing Partner of Giant Ventures, highlighted the importance of Arbol’s pioneering approach, saying, “You can’t go a week without reading an article about extreme weather events occurring and the challenge this poses for traditional insurers. Arbol’s pioneering approach enables businesses, large and small, to manage climate risk where traditional insurance fails. Their achievements are hugely impressive, and we believe they’re building an essential pillar of climate adaptation and the global financial infrastructure.”
Thibaut Schlaeppi, Managing Director of Opera Tech Ventures, underscored the need for scalable and economically sustainable hedging solutions in the face of climate change, stating, “While climate change is more and more tangible, the need for hedging solutions that are scalable and economically sustainable is becoming key. Leveraging insurance and capital markets offers Arbol’s clients a pivotal solution to build the financial resilience they need.”
This funding round represents a significant milestone for Arbol, reinforcing its commitment to providing innovative climate risk management solutions that cater to a wide range of economic participants. With this investment, Arbol is poised to further expand its reach and impact, addressing the critical need for effective climate risk management strategies in an increasingly volatile world.
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