ThreeFlow: The Interoperability Protocol for Benefits Insurance
Every year, US employers spend over $1 trillion on benefits insurance for their employees. This includes coverage for dental, vision, worksite, life, disability, stop-loss and medical insurance . On average, companies spend between $5,000 and $30,000 per employee per year, which accounts for ~30% of total compensation. Today, there are several hundred insurance carriers in the U.S. servicing the needs of over 6 million businesses and 150 million employees.
Sitting between the insurance carrier and the end employer is a network of several thousand benefits brokers. These brokerages act as advisors to employers — helping them discover, select and manage benefits for their employees. Benefits are a complex and massive spend category for employers, but it is a non-core skill set that most HR functions will outsource to their broker. In addition, these brokerages act as a necessary distribution partner for carriers given the unwieldly fragmentation of the end employer.
These benefits brokerages typically take anywhere from 5% to 15% of total premium written, which drives the ~$50B+ of revenue that they pull in every year. However, despite their size, the employee benefits industry still relies on archaic and siloed technology. Regulatory requirements, data security needs, and competitive environment disincentivized open systems. This meant that organizations adopted tech stacks that only worked for themselves without considering the constant need to exchange data with external partners.
The result? Every year, benefits brokers work with employers and insurance carriers to manually procure and renew $1 trillion of benefits spend through emails, spreadsheets, and phone calls. Without meaningful collaboration tools, brokers and carriers are stuck in an endless back and forth. Their work is rife with costly mistakes as billions of data inputs are exchanged in unstructured formats and manually re-typed into carrier and broker systems. The benefits industry needs a unified system that brings the broker, the carrier and the employer together.
Enter ThreeFlow. ThreeFlow is the first Benefits Placement System, a new category of enterprise software that allows benefits brokers and insurance carriers to maintain their relationships and enhance collaborative efforts to help employers make the best benefit decisions for their employees. ThreeFlow automates manual processes involved in placing benefits: sending attachments back and forth, compiling and standardizing lengthy RFP’s, performing policy comparison calculations offline, and iterating negotiations between carriers, brokers, and employers. ThreeFlow’s software ultimately acts as an embedded B2B marketplace that removes cost from the system in addition to reducing headache.
Beyond vertical collaboration software, ThreeFlow is building the interoperability protocol for the benefits insurance industry, which will further democratize information sharing. Through “ThreeFlow Connect”, their system-to-system integrations, they are building direct APIs into the broker’s agency management system and the carrier’s quoting and rating system. This will allow plan changes to be updated autonomously and in real-time. Today, ThreeFlow is a centralized platform where brokers and carriers meet. In the future, ThreeFlow will act as the actual connective tissue between broker and carrier systems. This is unique and hard-fought-for infrastructure that positions ThreeFlow as an N-of-1 company.
On the back of this innovation, ThreeFlow has experienced strong growth and customer demand. Today, ThreeFlow now processes over $2.0B of premium annually across 50+ carriers, 200+ brokers and 9,000+ companies. When speaking with many of the world’s largest benefits brokerages and insurance carriers, we found that ThreeFlow has emerged as the neutral third-party focused on enabling an industry, not disintermediating. As a result, ThreeFlow has quickly become the industry standard.
We are overjoyed to be partnering with Ryan, Richard and Shaheeb on their Series C alongside our friends at Emergence, Accel, and Equal Ventures.
