London-based insurtech startup Zego has raised $42 million to boost its European expansion. The financing round was led by Target Global and joined by Balderton Capital and Transferwise co-founder Taavet Hinrikus, who is also joining the company’s board.

Zego says it will use the fresh cash to expand operations throughout Europe and double its workforce from 75 to 150 people to capitalise on the growing mobility market.

Founded in 2016, Zego offers flexible insurance for the ‘gig economy’ and has recently expanded its B2B offering to cater to ride hailing, ride sharing, car rental and scooter sharing service providers.

The startup offers a range of policies from minute-by-minute insurance to annual cover, with pricing based on usage data from vehicles, which is not typically provided by more traditional insurers.

Zego says it already insures a third of the UK’s food delivery market, mostly thanks to partnerships with Deliveroo, Uber Eats and Just Eat.

Sten Saar, CEO and co-founder of Zego, commented on the funding round: “When we built Zego from scratch three years ago, our mission was to transform the insurance sector by creating products which truly reflected the rapidly changing world of transport. We’ve already come a long way since then, and the latest funding round paves the way for an exciting new chapter as we expand through Europe.”

“The world is becoming more urbanised and because of this, we are moving from traditional ownership of vehicles to shared usership. This means that the rigid model of insurance that has existed for hundreds of years is no longer fit for purpose,” he added.

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