Pay-as-you-go insurance provider Zego has raised £1.225m in Seed funding in a round led by LocalGlobe.
Previously known as Tego, Zego is also launching its first product for drivers, which the startup says is fully underwritten by Aviva.
Launched last year, the company provides ad-hoc insurance for drivers working for sharing economy firms such as Deliveroo, UberEATS and Jinn.
The firm, which will use the funds to expand its technology capabilities, enables drivers to pay for cover for the hours they work.
“We want to empower people across Europe to work in the way that suits their life and commitments. We’re targeting part-time drivers with a product that is particularly tailored to help them get the most out of work.
“Buying insurance should be quick and easy, mobile, flexible and transparent. You should only have to pay when you earn and that way our insurance helps you to work and take control of your expenses,” said Harry Franks, who co-founded the business alongside Sten Saar (COO) and Stuart Kelly (CTO).
Robin Klein, partner at LocalGlobe, said: “The world of work is changing fast and services like insurance have a long way to go to catch up.
“Zego is a simple idea but it has the potential to free millions of people around the world to work in a way that suits them.
“As Zego collects more data about delivery drivers it will also help the insurance industry price premiums more effectively, which ensures that sharing economy jobs really do pay for those who rely on them,” he concluded.
The news comes after Cuvva, another firm seeking to disrupt the InsurTech space by enabling drivers to pay as they drive raised £1.5m also from LocalGlobe in January.