German digital insurance company Wefox said Wednesday it raised $110 million in new funding from backers, among others JPMorgan and Barclays.

The news marks a vote of confidence for the insurance technology field at a time when it is facing severe macroeconomic headwinds.

Wefox is a Berlin, Germany-based company focused on personal insurance products, such as home insurance, motor insurance and personal liability insurance. Instead of underwriting claims itself, the company connects its users with brokers and partner insurance companies through an online platform.

Founded in 2015, it competes with the likes of US digital insurers Lemon juice and the German company GetSafe, as well as established insurance companies such as Allianz.

Wefox said it raised the new funds through a combination of debt financing and new equity. Of a total of $110 million, $55 million is in the form of a credit facility from banking giants JPMorgan and Barclays. An additional $55 million in equity investment was led by Squarepoint Capital, a global investment management firm with $75.7 billion in assets under management.

“It’s a new type of financing for a growth company,” Julian Teicke, Wefox CEO and co-founder, told CNBC in an interview. “Venture investors, equity investors, they understand, they want to take risks.”

“Banks usually don’t do that, so for them it was really important to understand our path to profitability and maturity of our business,” he added.

The company said it retained its Valuation of $4.5 billion from a funding round in July — a rarity in today’s market, with many fintechs seeing their valuations plummet.

Wefox’s announcement comes as the fintech and tech industry as a whole grapples with a tougher economic environment, finding it harder to raise funding.

Higher interest rates have prompted investors to reevaluate growth-oriented technology companies, with equity markets – and fintech in particular – taking a beating. In the public markets, US company Lemonade has seen its shares fall 23% over the past 12 months, although the stock has risen 13% year-to-date in 2023.

Layoffs have also plagued the fintech space. On Tuesday, money transfer company Zepz told CNBC that it was rental 420 employees go, or 16% of its total workforce, in the latest round of layoffs to hit the sector.

The collapse of Silicon Valley Bank has also weakened the outlook. The technically focused lender collapsed earlier this year after its startup and venture capital clients fled in panic due to capitalization problems.

Despite the headwinds facing the wider tech industry, Teicke says he believes Wefox is “crisis-resistant”. In the first quarter of 2023, Wefox saw its revenue almost double compared to the previous year. The company expects to reach profitability by the end of this year.

Teicke also said that Wefox has not faced the same pressure to lay off staff. Instead, it has changed its priorities, he said, “doubling down on things that work and stopping things that don’t make sense.”

For example, Teicke said Wefox focused on its broker partnership model and its so-called “affinity” distribution method, where it sells its insurance software to other companies for a subscription fee — such as an online car dealer that adds car insurance at the point of sale.

The new funds will go towards investing in Wefox’s affinity program and technology platform, the company said.

Teicke said Wefox is also investing heavily in artificial intelligence, which has become one warm area of tech recently after the rise of viral AI chatbot ChatGPT. Wefox primarily uses AI to automate policy applications and customer service.

The company has three technical hubs in Paris, Barcelona and Milan dedicated to AI.