Coverwatch Raises $4.5M to Disrupt the Legacy Commercial Insurance Industry, with an AI-Native Solution That Improves Coverage and Reduces Client Premiums by 20-40 Percent

Unlike traditional brokers, who earn a commission tied to premiums, Coverwatch charges a flat fee, so it's incented to find the best coverage for the price, not the highest price

SAN FRANCISCO, July 23, 2026 (GLOBE NEWSWIRE) -- Coverwatch, disrupting the legacy commercial insurance industry with the best AI-native solution for evaluating risk, closing coverage gaps, and lowering premiums, announced today that it has raised a $4.5M pre-seed round. Led by CoFound and Restive with participation from KFund, liquid2 ventures and others, the round will help Coverwatch accelerate product development and expand its team.

The traditional brokerage model was born with an inherent conflict: because brokers are paid on commission, their compensation rises as client premiums do. This has created a structural mismatch - brokers are incented to find higher-priced coverage. In the U.S. in 2025, companies spent $400B+ on commercial insurance premiums. About 10 percent of that - $40B+ - went to broker commissions.

Advances in AI now make it possible to automate policy analysis, benchmarking, and servicing, and to tailor coverage to each business's actual risks rather than an off-the-shelf template, enabling a new model that augments human experts with software and realigns incentives. That's what Coverwatch has built.

“Running a business today means managing risks that evolve faster than an annual renewal cycle can keep up with - new products, new markets, new contracts, new exposures," said Jordan Wan, Founder and General Partner at CoFound. "Legacy brokers answer that complexity by going back to the same few carriers that pay the best commissions. Coverwatch is building something different: the system of intelligence for commercial insurance. Its AI continuously monitors a business and keeps coverage aligned as it grows, solicits bids from 50+ carriers for every quote, and charges a flat fee, so its incentives sit entirely with the client. It's a great use case for AI with measurable impact, and we're excited to be a part of it.”

Coverwatch focuses on businesses whose risks are complex and fast-changing, and who want a single platform for managing the entire lifecycle of insurance with confidence they're getting the best coverage and price. Its clients span three markets: homeowner associations, where Coverwatch has reversed years of relentless premium increases; venture-backed technology companies including Pear, the social commerce venture from Lime co-founder Brad Bao; and scaling consumer brands in ecommerce and CPG. On average, Coverwatch reduces clients' insurance costs by 20 to 40 percent while closing coverage gaps.

Coverwatch was founded by Miquel Llobet ( CEO), Kevin Wu (COO) and Wilmer Yan (CTO). Llobet previously founded a Y Combinator-backed tech-enabled HOA management company, and saw firsthand how challenging it was to find, secure and renew HOA commercial insurance policies. Coverwatch helps HOAs secure coverage, identify and close coverage gaps, make sure they aren't overinsured, and lower premiums, while saving managers tens of hours each month.

The HOA vertical was Coverwatch's initial target and remains its fastest-growing segment.
"Commercial insurance was ripe for AI transformation, and I'd felt the pain firsthand running an HOA management company," said Llobet. "We talked with 50 brokerages and learned we couldn't just slap an AI bandage on this problem - we had to rethink the process from first principles. Decades of misaligned incentives had caused massive downstream problems."

Coverwatch's core IP is its information extraction and summarization pipeline, which agentically maps each client's business to the right underwriting questions. The team spent months interviewing insurance experts across industries and lines of business, and that expertise guides every Coverwatch search and is refined continuously. The result is coverage tailored to each business's actual needs, with bids solicited from 50+ carriers at once rather than just a few. And unlike traditional brokers, Coverwatch's work doesn't end when the policy is bound: the platform delivers proactive recommendations to reduce risk throughout the year, supports contract reviews and insurance planning, and provides hands-on claims management and assistance.

Coverwatch is currently licensed in 17 states and expects to be licensed in all 48 continental U.S. states by Q3 2026. The company currently has a team of 6 and expects to roughly double headcount by the end of 2026. Its revenue has been doubling each month on average since Q2 2026. Most growth has been driven by word of mouth from happy customers.

About Coverwatch
Coverwatch is disrupting the legacy commercial insurance industry with the best AI-native platform for evaluating risk, closing coverage gaps, and getting the best possible coverage at the right price. Unlike traditional brokers, who earn a commission tied to your premium, Coverwatch charges a flat fee, so it's incented to find the best coverage for the price, not the highest price. That alignment is backed by AI automation that searches across 60+ carriers and crafts tailored quotes in 24 to 48 hours, passing the premium savings on to clients - 20-40 percent on average. The fast-growing company is backed by top investors including CoFound Partners and Restive. Learn more at coverwatch.com.

Media contact:
Michelle Faulkner
Big Swing
617-510-6998
michelle@big-swing.com

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/1ac24b70-a153-4a6d-b45f-3cd32a64ada6

Coverwatch fixes a fundamental insurance industry problem: aligning client needs with broker incentives

Unlike traditional brokers, who earn a commission tied to premiums, Coverwatch charges a flat fee, so it's incented to find the best coverage for the price, not the highest price.

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