Arbol secures $60 million in Series B funding led by Giant Ventures and Opera Tech Ventures, with participation from Mubadala Capital.

New York City-based, Arbol, officially announced its Series B funding closing by securing a $60 million fund. Arbol is a leading climate solutions provider operating in over fifteen countries. The Series B Funding round was co-led by Giant Ventures and Opera Tech Ventures with participation from Mubadala Capital. The firm is a technology-led underwriter of parametric risk transfer, climate and weather insurance or reinsurance business. The recent injection of investment is used to elevate parametric insurance in response to what it sees as increasing climate-related risks, while also helping to make that risk into an investable asset class. 

Amidst the year with multiple unprecedented and unpredicted climatic events, 398 natural disasters have caused $380 billion in losses and a record of 37, billion-dollar insured loss events. Amidst this, Srbol’s recent funding demonstrates a long overdue moment for climate risk insurance. Apart from that, parametric insurance offers payouts based on predefined and trusted climate data triggers, such as rainfall amounts or temperature thresholds. 

Objective data triggers replace the subjective ones and time-consuming manual damage assessments conducted by claim adjusters, enabling quicker delivery of urgent financial relief to communities following catastrophic climate events. For example, if rainfall falls below a certain level, adversely affecting crop yields, farmers could receive rapid financial support when facing drastic weather conditions resulting in reduced production. 

Arbol adds value to climate risk management by bringing in scale, efficiency, and transparency. By leveraging global and trusted datasets for objective loss triggers, Arbol aims to broaden the adoption of parametric products and pioneer the concept of climate risk as a tangible, investable asset class. It differentiates itself through its technology ecosystem which combines automated structuring, AI-powered underwriting, pricing tools, and user-friendly platforms for agents and brokers. Combining this approach with flexible risk capital enables Arbol to underwrite bespoke solutions, facilitating the scalable distribution of innovative financial products.

Regarding this, the CEO and founder of Arbol, Sid Jha said, “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.”

The latest investment will facilitate Arbol’s further exposure to agriculture and renewable energy through products tailored for new hazards and geographies. In addition, the raised capital will also support Arbol’s global reach and widen its investment in property and casualty (P&C) and home insurance business lines in the U.S. and internationally. On top of that, the company will continue to strengthen its work with entities in the financial sector, such as banks, which are facing new challenges with climate risks, both for their internal risks and client needs. 

Cameron McLain, Co-founder and Managing Partner of Giant Ventures said, “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.”

Furthermore, the Managing Director of Opera Tech Ventures, Thibaut Schlaeppi added that despite how tangible climate change is, equally is a need for hedging solutions which are both scalable and economically sustainable. It is the key to climate risk management. Making good use of the insurance and capital markets paves the way for  Arbol’s clients a pivotal solution to build the financial resilience they need. 

Previously, the firm raised a $7 million Series A funding round in January 2021 led by a member of The Susquehanna International Group of Companies (SIG) with participation from Mubadala Capital and Space Capital.

In 2023, the company made a transaction of $250 million in gross written premium (GWP) elevating its business in its renewable energy and reinsurance businesses. Coming to the subsidiary of Arbol, Arbol Insurance Services (AIS), got its approval from Llyod’s of London cover holder in May last year. Recently, the company launched its latest insurance policy, Lilypad Insurance, which is career-oriented serving the unique insurance needs of homeowners and property investors in coastal areas. 

Lilypad received its recognition from Louisiana and has begun operations in the state. The certificate of authority allows Lilypad to start away its operations and subsequently, Lilypad announced the acquisition of Centuari Speciality Insurance Company and Centuari National Insurance Company, subject to regulatory approval. Lilypad Insurance will enable Arbol to grow the total addressable market of parametric insurance through hybrid product distribution while addressing the urgent need to address the growing coverage gap in coastal communities.

The success story of this climate risk management platform, Arbol spans globally in over 15 countries and includes a wide range of businesses. This Series B funding is a testament to Arbol’s vision, The execution ability and expertise of the Arbol team, and the significant market demand for innovative risk management solutions.