Alphabet’s Verily, Reinsurer Swiss Re Target Self-Insured Firms With New Venture

Verily, an Alphabet company, is creating a new subsidiary, Coefficient Insurance Co., that will be backed by reinsurer Swiss Re Group, according to a Tuesday (Aug. 25) press release. The announcement said the partnership will take aim at controlling healthcare costs for self-insured employers.

The partnership’s commercial, stop-loss insurance would cover unexpectedly high health costs of large companies — reimbursing them for claims above a certain amount, according to the release. Verily is a sister company of Google.

Verily, Alphabet’s life sciences division, said the product would also help these “employers to control cost volatility through a data-driven model.” Coefficient will draw both on Verily’s “core strengths integrating hardware, software and data science” along with Swiss Re Corporate Solutions’ reputation and its knowledge of risks.

“Employers have been facing rising and increasingly unpredictable healthcare costs for years,” said Verily CEO Andy Conrad. “Coefficient is aimed at reducing blind spots and providing greater cost control mechanisms for self-funded employers, and we expect that partnering with Swiss Re Corporate Solutions will help us to better develop and distribute our precision risk solution to the employer stop-loss market.”

Conrad continued, “Over time, we look forward to integrating Coefficient with Verily’s employer health solutions, including mobile health devices and innovative care management programs, in order to align payment models with better health outcomes.”

Swiss Re Corporate Solutions is taking a minority stake in Coefficient, subject to regulatory approvals. Ivan Gonzalez, CEO of Swiss Re Corporate Solutions in North America, is expected to join the Coefficient board of directors upon the closing of the deal.

Swiss Re Corporate Solutions CEO Andreas Berger said his company is partnering with Verily “to use advanced technology and data analytics to innovate risk management.” He said his company is looking to “address industry inefficiencies, provide an outstanding customer experience and advance corporate insurance together.”

Also this month, Verily opened a coronavirus test lab at its South San Francisco, Calif., headquarters. In an interview on the Verily blog, Deb Hanks, M.D., Verily’s head of pathology, said the lab way would “provide a focused specialty service with rapid turnaround time,” running thousands of tests per day. A focus will be on helping those who are trying to safely return to work and school.