Luzern Risk has closed a $45 million Series B round to expand its AI-native captive insurance platform. The funding, led by Insight Partners with participation from Trust Ventures and existing investor Caffeinated Capital, arrives as more companies look for alternatives to traditional commercial insurance amid rising costs and market volatility.
Caffeinated Capital previously led the company's seed round in 2023 and its $12 million Series A earlier in 2025. The new capital will fund product development, deeper AI capabilities, operational scaling, and a broader set of alternative risk offerings.
What captive insurance does
Captive insurance companies are regulated insurers owned by the organizations whose risks they cover. Rather than transferring all risk to commercial carriers, companies use captives to create customized coverage, retain underwriting profits, and build surplus over time. Roughly $240 billion in gross premium flows through captive insurers, representing about 10% of the global property and casualty market.
The model has historically served large multinationals. Luzern's bet is that software and AI can change that math. By automating underwriting workflows, regulatory reporting, accounting, and claims administration, the company aims to make captives economically viable for middle-market businesses that previously considered them too complex or expensive.
Where the money goes
Luzern plans to invest in three areas. First, it will build out its technology platform and AI capabilities to improve administration efficiency and give captive owners better risk insights. Second, the company will systemize internal operations to cut turnaround times on processes that have required heavy manual work. Third, it will introduce additional products across the alternative risk value chain.
Gabriel Weiss, CEO and co-founder, said the conviction behind the company's thesis has only strengthened. "We set out to make captives more accessible to a broader set of the market, and everything we have learned since has strengthened our conviction that captives will play a far bigger role in risk management than they do today," Weiss said. "This investment lets us do what we care about most: deliver better outcomes for our clients, at a much greater scale."
Building infrastructure, not just software
Luzern's platform works alongside brokers, fronting carriers, reinsurers, and advisers. Customers range from middle-market firms to publicly traded corporations. The company said revenue has grown rapidly year over year as demand for alternative risk solutions has increased.
Jonathan York, CTO and co-founder, framed the technology's role in practical terms. "This is a space where technology can have an outsized impact for clients. Every process we automate makes a captive more efficient to run while increasing quality, and every capability we add gives owners something they could not get before."
The longer-term ambition extends beyond individual captive owners. Luzern wants to create shared infrastructure that brokers, carriers, reinsurers, and regulators can use - common technology and standards that make it easier to place risks into captive structures, provide better underwriting information, and deliver structured reporting to regulators. For professionals tracking how AI is reshaping financial services, AI for Insurance Courses offer practical grounding in these automation trends.
Philine Huizing, Managing Director at Insight Partners, described the shift as structural. "The captive market is undergoing a structural expansion, moving from a tool reserved for large multinationals into a viable strategy for a much broader universe of companies," Huizing said. "Luzern is building the infrastructure layer that makes that expansion possible." Insight Partners manages more than $90 billion in regulatory assets and has invested in over 900 companies globally.
Varun Gupta, General Partner at Caffeinated Capital, said the firm is increasing its commitment. "We led the seed and Series A rounds of Luzern because we believed in Gabriel's vision of modernizing captives. We look forward to tripling down as this exceptional team continues to execute against the massive opportunity of building the world's best alternative risk solutions."
Why this matters for insurance and finance professionals
Captive insurance is a $240 billion market that has stayed stubbornly manual. If Luzern succeeds in automating the administrative stack - underwriting, compliance, claims, reporting - it changes the unit economics for a much wider range of companies. That means carriers and brokers will increasingly encounter clients who want to blend traditional coverage with captive structures, and they will need to understand how AI-driven platforms fit into those arrangements. For finance leaders, the question shifts from "can we afford a captive" to "can we afford not to evaluate one."
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