Home Insurance Firm Hippo Plans To Merge With SPAC To Go Public

Home Insurance Firm Hippo Plans To Merge With SPAC To Go Public

Home insurance group Hippo Enterprises Inc. plans to go public by merging with special purpose acquisition company (SPAC) Reinvent Technology Partners Z, according to a Thursday (March 4) announcement.

“Through this strategic partnership with Reinvent and an incredible team of world-class entrepreneurs, investors, and employees, we can’t wait to transform the homeowner experience and accelerate our growth,” Hippo CEO and Co-Founder Assaf Wand said in the announcement.

The board of directors of Hippo and Reinvent have unanimously given the green light to the deal, which is anticipated to close in the middle of this year and is subject to “customary closing conditions” being met such as the go-ahead from Hippo’s stockholders and Reinvent’s shareholders, according to the announcement.

Hippo, which was established in 2015, is developing what it says is the first vertically integrated, complete home protection and insurance system. Its omnichannel distribution lets clients purchase policies through the web, an agent or a company partner.

Moreover, Hippo’s Smart Home Program is meant to stop events like water damage from occurring. The company harnesses in-the-moment information to forecast and monitor significant weather occurrences, letting its claims team contact homeowners ahead of an event to help protect them. In one case, Hippo contacted clients before the recent storms in Texas to help them get ready for frozen pipes or water damage.

In a previous interview with PYMNTS, Wand made the case that digital platforms can not only solve the pain points of getting claims paid, but also put steady management of home maintenance into place that minimizes trouble spots.

At a high level, Wand said insurance means “you are buying the right to file a claim that is supposed to make you whole, if God forbid something happens … it’s a safety net, but over time the safety net becomes smaller and smaller.”

That shrinkage is partly because as time goes on, individuals shift the contours of their homes, adding swimming pools, decks and other creature comforts. Wand indicated that six in ten homeowners are “underinsured” when they don’t phone their carriers to revamp their policies.

But now, he said, the stage is being set for rethinking what home insurance can — and should — be.