Rainbow Secures $8 Million to Expand Small Business Insurance Offerings
Rainbow, a digitally-enabled managing general underwriter (MGU) specializing in small business insurance products, has secured $8 million in Series A funding. This financing round, led by Zigg Capital, closed in the fourth quarter of 2024 and brings the company’s total capital raised to $20 million since its inception in 2022.
The funding will accelerate Rainbow’s plans to expand its specialized underwriting approach to additional business verticals. The company has recently launched its second program in select states, with a nationwide rollout planned in the coming months. Rainbow’s initial product, an admitted business owner’s policy (BOP) designed specifically for the restaurant industry, is currently live in 24 states and will be expanded into additional states, including New York.
Rainbow’s technology platform provides agents and brokers with a seamless quote-to-bind experience, while rewarding policyholders for prudent operational practices. The company’s data-driven “continuous underwriting” framework enables real-time portfolio assessment, improving underwriting accuracy and decreasing loss ratios. This specialized risk selection approach is supported by Rainbow’s proprietary in-house risk monitoring software.
The company’s focus on vertical specialization allows it to address the unique risks faced by small businesses in challenging industry niches. Rainbow’s platform is designed to help small businesses thrive by providing tailored coverage that aligns with their specific needs. The company’s products are distributed exclusively through independent insurance agents and digital partners.
With this new capital, Rainbow aims to deepen its partnership with Zigg Capital, a firm that shares its vision for a differentiated approach to profitable insurance underwriting. The funding will also enable Rainbow to continue innovating its proprietary technology and attracting top talent to its team.
Rainbow’s growth has been among the fastest observed for a B2B offering, with its custom-built software serving various constituencies being particularly powerful. The company’s specialized underwriting approach and technology platform have positioned it as a leader in the small commercial insurance industry.
The recent funding round underscores the confidence investors have in Rainbow’s strategy and its potential to transform the small business insurance landscape. With its expanded resources, Rainbow is poised to further its mission of providing tailored insurance solutions to small businesses across various industries.
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