French insurtech unicorn Alan is shaking up Canada’s health insurance market with the launch of its digital group health insurance product, designed specifically for tech startups and small businesses. The company, backed by the Ontario Teachers’ Pension Plan Board, claims its offering is cheaper and more accessible than traditional competitors.
Challenging the Status Quo
Alan’s general manager for Canada, Mark Goad, criticized the current market, stating that Canadians “pay a lot” for health insurance, just like they do for telecommunications and banking. The company’s research identified a “highly concentrated oligopoly” in the Canadian health insurance market, which often results in “exorbitant fees” for consumers.
Key Features of Alan’s Offering
- Digital group health insurance available entirely online
- No brokers, phone calls, or paper forms required
- Transparent pricing with no hidden costs
- 15% fees, half of the average incumbent insurer
- No multi-year lock-ins
- Three plan options ranging from $86 to $149 CAD per person monthly
Market Entry Strategy
Alan secured a license from the Office of the Superintendent of Financial Institutions six months prior to launch, becoming Canada’s first new health insurance carrier in nearly 70 years. The company is initially available in Ontario and Alberta, with plans to expand to British Columbia and Québec pending regulatory approval.
Business Background
Founded in 2016, Alan provides health insurance to employers and virtual healthcare services to employees through its app. The company has 700,000 individual members across 35,000 business customers, generating $780 million in annual recurring revenue (ARR) and growing 50% year-over-year. Most recently valued at $6.3 billion CAD, Alan has raised over $1 billion in total funding.
Expansion Plans
Alan plans to grow its Canadian workforce to 50 employees over the next four years. The company will initially focus on tech startups before expanding to white-collar businesses and other industries. Mark Goad expressed excitement about adding another option to the Canadian health insurance market, stating, “I think that’s what Canadians deserve.”
Related Developments
Alan’s entry into Canada is supported by its previous success in Europe and significant financial backing. The company’s experience in challenging established markets in other countries is expected to help it make an impact in Canada’s concentrated health insurance industry.
