More than half of Americans have less than $1,000 in their savings accounts, an alarming statistic that shows the reality of how many people aren't prepared for a day when they might unexpectedly fall on financially hard times.
Many Americans have access to health, home and automobile insurance, but what about insurance for a rainy day? That’s where SafetyNet comes in.
The tech company, which launched in 2016 as a subsidiary of Madison, Wisc.-based CUNA Mutual, provides people with insurance in the event they unexpectedly lose their income due to a layoff, an illness or injury. And it promises to deliver a lump sum of cash to policyholders within two days for approved claims, said Mark Greene, director of SafetyNet.
“There’s a lot of people that don’t have that emergency fund,” Greene said. “SafetyNet’s mission is to improve the financial well-being of millions of hard-working people in America. We’ve taken a new approach to create innovative solutions to get around solving this problem.”
Right now, the insurance is available in Wisconsin and Iowa, and they just launched in South Carolina. But by the end of the year, SafetyNet is slated to be available in 13 states, Greene said. He declined to disclose how many policyholders SafetyNet has or how many claims have been filed, but said the product is growing 30 percent each month.
“We’re excited about what we’re seeing in terms of growth," Greene said. "It tells us that we’re tapping into a market that is underserved."
On average, SafetyNet’s plans cost anywhere from $5-30, and pay outs are between $1,500-9,000. When people sign up for SafetyNet, they choose how much they estimate they would need in a pay out to cover their expenses, and the company then determines what their monthly plan would cost.
SafetyNet, which currently employs 16 people, is able to keep their policy prices low because they don’t employ agents. They market their product directly to consumers using their website, Greene said, adding that doing so keeps their overhead expenses minimal. In Wisconsin, policyholders are covered and can file a claim 30 days after signing up.
In December, SafetyNet launched a new policy, specifically designed for landlords whose tenants can’t pay for rent for some reason. Called Renter SafetyNet, the policy operates much like SafetyNet. It not only protects the renters from potential eviction, but keeps rental income flowing to landlords' pocket, Greene said.
“After we launched SafetyNet, we had landlords coming to us, saying, ‘This would be great for me. I know that my tenants need this,’” Greene said.
