Disrupting health insurance is no easy feat, but the investors behind Oscar Health, the start-up co-founded by Joshua Kushner, believe the company has got the model right and is poised for massive growth.

Oscar Health has raised $165 million in new funding in a round led by Founders Fund, with participation from two branches of Google's parent company Alphabet: the Capital G growth investment arm, and the Verily life sciences segment.

The company shared the news in a blog post, which it shared exclusively with CNBC.

That brings the insurer's valuation to $3.2 billion, according to sources familiar, a jump from its last-reported valuation of $2.7 billion from 2016.

Oscar was founded in 2012 by current CEO Mario Schlosser, Kevin Nazemi (who is no longer with the company), and Joshua Kushner, brother of senior Trump advisor Jared Kushner. Its mission was to take advantage of the new marketplaces for individuals to buy health insurance created by the Affordable Care Act (Obamacare). It started out in New York, but has now expanded to five other states.

The company believes it can beat larger insurers like UnitedHealth and Aetna through its focus on customer service and technology, which includes a mobile app for booking appointments and consulting with a physician. It's geared toward individual insurance buyers rather than company insurance plans.

Schlosser told CNBC that Oscar has the "highest member engagement" of any insurer.