Despite US P&C insurers having just posted their best underwriting year in decades, a YC-backed startup has revealed a blind spot cutting into insurers' profits – and has launched a solution that could help each company generate millions in additional EBITDA.
RICHMOND, VA., Sept. 22, 2026 /PRNewswire-PRWeb/ -- Soteris, a YC-backed machine learning company for the P&C insurance industry, today announced the launch of a new product that helps carriers and MGAs make more money, often millions more, from their current distribution network, without any change to rates, forms, filings, or headcount.
Soteris's first product, which helps insurers improve their loss ratios, has been live with carriers and MGAs since 2020 and has scored over 100 million policy submissions totaling more than $180 billion in premiums to date. That growth was largely driven by founder-led sales with zero ad spend. Today, the company is stepping out of stealth for the first time, unveiling its new AI profit optimization product, which is specifically designed to directly target an insurer's bottom line, alongside results from its work with existing customers.
Soteris has raised over $8M in seed funding, led by Spider Capital, with participation from Intact Private Capital, Amplify Partners, DCVC, the Webb Investment Network, and Overlook Ventures.
Insurance is one of the only industries in which the producers (the insurance companies) don't know their cost of goods sold (claims losses) until well after they've sold their product. Because the outcome of any individual policy is binary (either it has a claim or it doesn't), insurers have long only been able to analyze results by aggregating policies into "segments" based on like characteristics, treating any variation within a segment as random noise rather than something predictable in advance. A segment needs a critical mass of policies before actuaries consider it "credible" — meaning any individual policy's true metrics get buried in the average.
This limitation carries a significant hidden cost for insurers. Consultancies like McKinsey have pointed to an uplift of 30 to 50 percent on gross underwriting results through coordinated action across levers like pruning the portfolio and recovering profitability on segments that look healthy in aggregate, and McKinsey's 2025 insurance report points to further granularity in segmentation and personalizing offerings by individual as where the industry is headed next.
That complexity is exactly what Soteris's products are designed to solve. The company has spent over 5 years developing in-house proprietary machine learning models that are capable of creating a multitude of credible segmentations of the policy history and analyzing them all simultaneously. Many insurers typically use spreadsheets and pivot tables to examine policy results, which can generate dozens or hundreds of credible analyses. In contrast, Soteris's method generates millions or even billions, depending on the number of policy characteristics known and the size of the data history. It then uses the intersections of these myriad individual analyses to examine individual policies, effectively making each policy a credible "segment of one."
Implementation for an insurer takes under 90 days, and once live, Soteris delivers its insight at any point in the policy lifecycle - either when a policy is quoted, when it's bound, or at any point after - in under 250 milliseconds via API.
Insurers have consistently experienced anywhere from a 5 to 15 point improvement in loss ratio in less than a year after implementing Soteris's first product. In working with these customers, Soteris realized there was a large gap between predicting a policy's loss ratio and predicting its profit contribution for the company writing it because the economics of a given policy are often split in complicated ways across multiple organizations. For example, the organization that sold and services the policy, the organization that holds the state license, and the organization that holds the necessary balance sheet capital to write the policy can all be three different organizations that get different pieces of the resulting economics.
Soteris created its latest product to bridge this gap. "Every insurer knows they're writing policies that will lose them money. They just can't find those policies with the resources currently at their disposal," said Sunit Shah, founder and CEO of Soteris. "That's the blind spot we built Soteris to close. For the first time, an insurer can look at a single policy and know exactly what it's worth, in time to act on that information."
The company has run several proofs of concept for insurers, where it has seen book EBITDA increases of between 70% and 125% — meaning an insurer could more than double its bottom line by using Soteris's new product. "That's a tremendous amount of value already sitting inside insurers' books, just waiting for them to retrieve it. And once they do, they can invest those gains back into their own operations to both reduce prices and improve the overall experience for their customers," Shah added.
"With his rare combination of finance, insurance, and quantitative experience, Dr. Shah is uniquely positioned to crack the toughest mathematical problems in insurance," said Minsoo Chi, Partner at Spider Capital. "Soteris already moved analytics from segment averages to policy-level expected loss. Extending that same resolution to predicting profit generation is the natural next step."
About Soteris
Soteris is an AI platform that gives P&C insurers policy-level insight on their most important financial metrics, such as policy profitability and expected loss ratio, at quote, endorsement, and renewal. Soteris products surface both the negative-profit and high loss ratio policies hidden inside segment averages, enabling insurers to grow profit, increase profit margins, and improve loss ratios. Soteris has scored over 100 million submissions to date, amounting to over $180 billion in insurance premiums.
Soteris was part of the Y Combinator 2019 cohort and is backed by notable investors including Spider Capital, Intact Private Capital, Amplify Partners, DCVC, the Webb Investment Network, Overlook Ventures, Clocktower Ventures, and Foundation Capital. Learn more: soteris.ai
Media Contact
Soteris Media Relations, Soteris, 1 8188588129, [email protected], soteris.ai
SOURCE Soteris
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