Wrisk Financial Model

Wrisk provides a cloud-based, legacy-free insurance platform that brands embed at the POS to upsell digital insurance to their customers. Key capabilities:

• Subscription billing model with instant mid-term adjustments (MTAs).
• WriskScore™ - proprietary transparency/rating mechanism.
• RESTful API integration; omnichannel ready.
• FCA-authorised; handles customer care, claims, and policy administration.
• Customised products per partner brand.

Core value to partners: increase conversion, share of wallet, and customer LTV. Core value to customers: frictionless, mobile-first insurance experience.

Current live products:

• MINI Flex: subsidised subscription motor insurance (first 6 months free, then ~£15.80/month). Signed contract with BMW/MINI.
• RAC Pay-As-You-Drive (PAYD): usage-based subscription motor insurance. Signed contract; Jan 2021 launch.

• Global POS insurance market: €1.5 trillion (Oliver Wyman cited).
• Current digital/POS penetration: only 1% of that market captured digitally.
• Incumbents generated €20bn of premiums via B2B2C.
• US auto insurance premiums: $214bn; US = 28% of world's $5bn non-life premiums.
• Australia: 1,060,000 car sales annually; Allianz generates €900M premium from AutoOEMs.
• No explicit SAM/SOM breakdown provided.

Three revenue streams:

1. Sales commission: 15% commission on GWP across the portfolio. 35% of that commission is paid away to B2B2C partners (i.e., net commission ~65% of 15% = ~9.75% of GWP retained).
2. Software build fees: modest bespoke capability fees charged to partners.
3. GWP flow-through: Wrisk is the MGA/underwriter-facing entity; GWP is top-line volume, not revenue. Commission is the revenue line.

Channel: B2B2C exclusively - Wrisk signs brand partners (BMW, MINI, RAC) who distribute to end consumers. No direct-to-consumer sales.

Pricing examples:

• MINI Flex: £15.80/month after free period.
• RAC PAYD: split parked premium + driving premium (usage-based).

2020 Actuals:

• Policies in force: 19,342
• GWP: £11.0M
• Revenue: £1.7M

Run Rate (Q4 2020):

• Monthly binds (new + renewals): 1,500+
• Annualised GWP run rate: £12M+
• Q4 MRR: £150K+

Customer adoption by quarter:

• Q1-19: 5,043 | Q2-19: 7,928 | Q3-19: 10,973 | Q4-19: 13,935
• Q1-20: 16,987 | Q2-20: 17,222 (Covid-19 impact) | Q3-20: 19,839 | Q4-20: 19,342 (Covid-19 impact)

MINI Flex Funnel:

• MINI Driveaway (Jan–Jun 2019): 704 policies / 19,208 cars sold / 3.7% participation rate.
• MINI Flex (Jan–Jun 2020): 1,520 policies / 10,668 cars sold / 14.2% participation rate → 3x conversion improvement.
• 3-month survival rate (Flex): 78%; participation post-survival: 11.1%.

:

Implied gross commission rate: BMW ~9.5% of GWP; MINI Flex ~17.4% of GWP (Flex earns higher commission due to subscription structure). Loss ratio prediction: 55% (historical sector benchmark).

• Wrisk frames itself as unique: "no digital insurance platforms currently being offered to OEMs in the US".
• Moat claims: FCA authorisation, proprietary WriskScore™, cloud-native legacy-free stack, signed OEM contracts (BMW/MINI, RAC), Allianz strategic partnership.
• Competitive context: traditional POS insurance is analogue (paper, phone); direct writers hold 72% US market share but focus on UBI only.
• No direct competitor benchmarking table in the deck.

• Series A: £4M+ raised Q2 2020. No mention of current round size or pre/post-money valuation.
• Use of funds: implied to fund scaling to 10+ brand partners by 2025 (UK) and international expansion.

• Archetype + why: Insurance GWP / commission revenue model with a B2B2C channel layer. Wrisk is an MGA-like platform that earns commission on GWP it facilitates. The core model should be: GWP build-up by partner programme → commission revenue → partner pay-away → net revenue → opex → EBITDA. This is closer to an insurance distribution / MGA model than a pure SaaS model, though a modest SaaS/software-fee line applies. Usage-based (PAYD) component adds a UBI sub-model for RAC.

• Forecast horizon & granularity: 2020–2025 (6-year), quarterly for Years 1–2, annual thereafter. Mirrors the deck's own forecast window.

• Key drivers & assumptions:

1. Number of brand partners - 2 signed (BMW/MINI, RAC); target 10+ by 2025 ramp: +2 partners/year from 2022 onward.
2. GWP per partner - anchored to BMW/MINI actuals (£11M total in 2020 across both programmes). RAC Year 1 base GWP: £2.55M. new partners sized at average of existing two.
3. Participation rate - BMW Driveaway: 4%; MINI Flex: 14%. new programmes target 10% participation (midpoint, post-Flex learnings).
4. Gross commission rate - 15% of GWP.
5. Partner pay-away - 35% of commission; net commission retained = 9.75% of GWP.
6. Software build fees - £50K–£150K per new partner (modest; flagged as supplementary in deck).
7. CAC - £13–£15 per customer. blended £14 for new programmes.
8. Renewal rate - 79–81%; 80% blended for model.
9. Loss ratio - 55% (sector historical benchmark). applies to PAYD programme; Wrisk bears no underwriting risk as MGA, so loss ratio is informational/partner context only unless Wrisk is on risk.
10. GWP ramp (base case): £11.0M (2020) → £16.7M (2021) → £53.9M (2022) → £112.1M (2023) → £187.4M (2024) → £258.2M (2025).
11. Sales commission (revenue): £1.7M (2020) → £3.5M (2021) → £10.2M (2022) → £20.4M (2023) → £33.4M (2024) → £45.7M (2025).
12. EBITDA: -£1.4M (2021) → £0.1M (2022) → £4.4M (2023) → £11.2M (2024) → £18.1M (2025).
13. Headcount / opex: implied from EBITDA gap vs revenue; no opex breakdown in deck. Back-solve opex from revenue minus EBITDA.
14. International GWP uplift (Good Case): AUS + USA overlay on top of UK base from 2022 onward. Good Case EBITDA 2024: £4.7M on combined GWP ~£300M+.

• Scenarios (Base / Bull / Bear - which variables flex):
• Base: GWP ramp as per slide 11; 2 signed partners + 8 new by 2025; UK only.
• Bull (Good Case): International expansion to AUS and USA from 2022; GWP doubles vs. base by 2024; participation rates at MINI Flex levels (14%) across new programmes.
• Bear: Covid/macro impact depresses new car sales (already evident in Q3–Q4 2020); participation stays at BMW Driveaway levels (4%); partner ramp delays by 1 year; revenue breakeven pushed to 2023.

• Required sheets / outputs:

1. `Assumptions` - all drivers above; Base/Bull/Bear toggles.
2. `Partner Build` - one section per partner programme; columns: cars sold × participation rate → policies → avg GWP → gross GWP → commission → partner pay-away → net revenue.
3. `P&L` - net revenue, cost of sales (partner pay-away), gross profit, opex (headcount, tech, marketing, admin), EBITDA.
4. `KPIs` - policies in force, GWP, MRR, CAC, LTV (annual profit / (1 - renewal rate)), payback period.
5. `RAC PAYD Sub-model` - parked premium + driving premium split; policies in force; Year 1–3 ramp (base vs. aspirational) per slide 10.
6. `International` (Good Case only) - AUS and USA GWP layers, additive to UK P&L at marginal cost.
7. `Dashboard` - GWP waterfall by partner, commission bridge, EBITDA walk, PIF growth chart.