Honeycomb raises $40 million as no-inspection insurance gets cheaper

Honeycomb Insurance just added $40 million to the war chest, but the more interesting number is not the raise. It is the way Itai Ben-Zaken says the company is operating: the AI-native insurer prices apartment buildings and condo associations without sending out inspectors, using hundreds of data points per property instead. Zeev Ventures led the round, Fortune learned exclusively, and Ibex Investors, Peakline, Alpha Partners, Meitar Partners, Practical VC, and NFL Super Bowl champion and former 49ers player Harris Barton also joined. The financing lifts Honeycomb’s total funding to $95 million, which Ben-Zaken called deliberately modest.

That modesty matters because Honeycomb is not behaving like a startup that still needs to prove the math. Ben-Zaken says the platform ingests geospatial datasets, aerial imagery, and building history to price each risk individually, and that means the company can offer coverage up to 40% cheaper for well-maintained buildings that traditional carriers either overcharge or pass on. Its customers are landlords, condo associations, and HOA boards managing multi-unit residential housing. In plain English: Honeycomb is trying to make a very old-school product, property insurance, behave more like software, with faster underwriting and lower variable cost.

The company’s pitch rests on a structural flaw in how many insurers historically handled this segment. U.S. commercial real estate insurance is a big market, and the U.S. multifamily insurance segment alone is worth over $34 billion a year. About 30% of Americans live in apartment buildings or condos, yet major insurers have largely retreated from the segment after getting burned by weather-related losses. When the policy is only worth about $5,000, a carrier typically cannot justify sending an inspector to the building, so a neat 1970s walk-up and a crumbling one down the street can end up being priced the same. Honeycomb says its data-heavy model closes that blind spot.

Ben-Zaken argues the company has already proven that the model can scale. He said Honeycomb ended 2025 with $275 million in gross written premium, covered more than $100 billion in total insured value across 22 states, and is already profitable. Gross written premium is the total volume of insurance premiums a company books, which gives you a sense of how much risk it is writing. Ben-Zaken also said, “We are cash flow positive,” and added, “But just like Amazon in the early days, everything we generate in profit we’re thinking about how to funnel back into building something bigger.” That is the classic insurer-tech dilemma in one sentence: keep profits or spend them on growth, product, and underwriting edge.

Honeycomb was founded in 2019 by Ben-Zaken and CTO Nimrod Sadot. Ben-Zaken, a Wharton MBA and Israeli military intelligence veteran, said the company came together after his first startup, Comprendi, went under after competing against Google and Meta. The lesson he drew was blunt: find a market that is large, fragmented, and populated by legacy players that are competent but technologically vulnerable. U.S. commercial real estate insurance fit the bill. That also explains why this category has become such a magnet for operators who think the real moat is not just capital, but better data, faster decisions, and lower servicing costs.

The catch is that the market window Honeycomb stepped through is getting narrower. Commercial property premiums climbed for six years, peaking near 20% annual increases in 2023, as carriers spooked by natural disaster losses pulled back capacity and raised prices. That retreat created room for a new entrant with a more surgical underwriting process. But now the direction is changing. A quieter 2025 hurricane season and an influx of new capital into the reinsurance market, the backstop insurers buy to cover catastrophic losses, has pushed apartment building coverage rates down 5% to 15%, with reinsurance costs falling 6.7% in 2025 alone. In a softer market, the buyer has more choices and the seller has less room to charge a premium simply because the old system was inefficient.

Ben-Zaken says Honeycomb still has a lever to pull when price pressure intensifies: speed and workflow. “In a soft market, you play more on the elements that are less related to price,” he said. “The fact that an agent can sell five policies from Honeycomb in the same time as one policy elsewhere-that's still an advantage.” That is a useful reminder for anyone building in financial services: in a hot market, being cheaper can win. In a cooler one, being easier to sell, faster to bind, and less painful to service becomes just as important. Ben-Zaken’s benchmark is Neptune, the flood insurer that went public last October at a roughly $2.8 billion valuation on around $400 million in gross written premiums. He said, “On the GWP side, we're not very far from them,” and added, “We'll cross $500 million in the next couple of years. At that scale, I think we'll be in the right zone.” For peers in insurance, fintech, and enterprise AI, the message is straightforward: the underwriting data advantage is real, but it now has to survive a market that is normalizing, not just a market that is broken.