Most people tend to think of insurance as a necessary evil, something you fork money over for in case you might really need it someday.
Phil Edmundson sees it differently. Edmundson, the founder and CEO of the insurtech company Corvus Insurance, believes insurance can be a force for good.
Take lead paint. It was insurance companies who put an exclusion in their policies so they no longer covered lead paint claims, forcing landlords to remove the toxic substance from their properties or face potential bankruptcy.
Phil can rattle off a whole list of examples, from football helmets (insurance companies mandated safer conditions) to sexual abuse cases in the Catholic Church (insurance companies ceased covering these claims, forcing the church to be more accountable).
“In so many of these areas, what might be seen as great human progress was driven by insurance companies,” says Phil. “And I love that about insurance.”
It’s an ethos Phil has adopted at Corvus, the company he founded five years ago, and which has provided him and his team with their North Star. “We ask ourselves everyday: ‘Is what we’re doing producing a safer world?’” he says.
“We ask ourselves everyday: ‘Is what we’re doing producing a safer world?’”
The answer is a resounding yes. And there’s so much of the world to make safer. Approximately 30,000 websites are hacked every day. In 2020, close to $1 trillion was lost around the world to identity theft, extortion, and data breaches, according to a recent McAfee report, and that number is predicted to reach $10 trillion by 2025.
Complicated and fast-paced
Phil’s journey to founding a fast-growing cyber insurance company began back in college. Most people end up in the insurance business by accident. Phil’s story involves serendipity and ice cream. In high school, Phil scooped cones at an ice cream shop. By the time college rolled around, he was ready to do something different and landed a summer job at a large insurance company.
After graduating with a degree in neuroscience, Phil realized he didn’t want to work in a laboratory, and instead found work at a global insurance broker. The industry suited him.
“I liked the fact that the subject matter was complicated and yet very fast-paced,” he says.
Phil quickly carved out a niche for himself as an expert in new technology. He has spent most of his career working with biotech and renewable energy companies, in software, and the internet.
“In some ways, I’ve served as an interpreter,” he says. “Someone who understands the language of insurance but also understands better than most people in insurance the risks associated with new technologies.”
It starts with a scan
The idea for Corvus came to Phil shortly after he sold his last business, an insurance brokerage company, back in 2015. Phil was investigating new areas and started exploring the growing field of insurtech. He quickly realized that there was a goldmine of information the insurance industry wasn’t putting to good use.
“There was a lot of data that wasn’t being used more broadly to predict and prevent bad things,” Phil recalls.
A conversation with a friend helped Phil realize that he had found his next role as the founder of a company that is a force for good by harnessing data to prevent cybercrime. Phil founded Corvus—named after the Latin genus that includes crows, the world’s smartest birds—in 2017. The company uses data and machine learning to perform an analysis of a company’s IT risk in one to five minutes. This “Corvus Scan” can tell a potential customer how well they are protected and what their vulnerabilities are. Corvus sells insurance policies to the well-protected, but also helps those who aren’t.
“When you have this mindset of creating a safer world, for every organization that applies to us for insurance—whether we sell them a policy or not—we’re running the Corvus Scan and providing them with scoring and recommendations to help them make decisions about how to better manage their cyber risk,” Phil says.
Leaning into the tech
Corvus is Phil’s first venture-backed company. As someone with more than 30 years of insurance experience, he could have felt a little daunted entering the youth-obsessed tech industry. The typical unicorn founder started their business at age 34, for instance.
But Phil has a few things on his side. The most successful startups in the U.S.—those in the top 0.1% of growth in their first five years—were launched by founders with an average age of 45. A 2020 report found that a 50-year-old founder is almost twice as likely to create a high-growth startup than a 30-year-old.
Then there’s the fact that insurance, which insurtech is part of, is a complex industry based on relationships that are built over decades.
“You have to have a track record in order to be trusted by the insurers and reinsurers we partner with,” Phil points out.
He also made the wise decision early on that if he was going to build an insurtech company, whenever the two cultures—insurance and technology—clashed, tech would win.
“We lean into the tech whenever possible,” he says.
Like hand sanitizer
So much in life is timing, and Phil couldn’t have picked a better time to found Corvus. The need for businesses to be protected skyrocketed in the five years since he founded the company, especially since the beginning of the pandemic, which saw a massive shift to remote work and boom in online commerce. Malware attacks alone increased by 358% in 2020. These days, one of Phil’s biggest problems is keeping up with demand—not that he’s complaining.
“It’s really exciting,” he says. “It’s like selling hand sanitizer in April of 2020.”
In his 30 plus year career, Phil’s never seen anything like what is happening now: Demand for his product is doubling with each year. Which just goes to show, when you have a great product and the right timing, you can have a booming business and be a force for good.