Friday, March 31, 2023

Start-up InsuranceDekho raises $150 mn in funding for expanding business

InsuranceDekho has raised $150 million in funding comprising equity and debt, making the deal the largest series A round by an Indian insurance technology company.

The equity round was led by Goldman Sachs Asset Management and TVS Capital Funds, with participation from Investcorp, Avataar Ventures and LeapFrog Investments.

InsuranceDekho, which was founded by Ankit Agrawal and Ish Babbar in 2016, aims to achieve an annualized premium run-rate of Rs 3,500 crore by March 2023. It will use the funding to improve technology, enter new markets and launch products in the health and life categories. The money will also be used for the company’s micro, small and medium enterprise (MSME) insurance business and strengthen the leadership team.

“Though insurance is vital for the financial security of everyone, its penetration is still at 4.2 per cent of Indian GDP compared to global coverage of 7.4 per cent. The key for this is to access the middle and lower middle income class living in the next 1000 towns of India. InsuranceDekho offers a powerful mechanism for this penetration to expand,” said Praveen Sridharan, partner at TVS Capital Funds.

TVS Capital has invested in the company through TVS Shriram Growth Fund III (Rs 2,000 crore). TVS Capital has invested around Rs 3,500 crore in more than 30 companies. “By 2025, we expect to deploy Fund III fully and come with Fund IV. Our focus will be on financial services and business services,” he said.

“We need to go beyond the urban regions when it comes to insurance penetration in the country. To realize our goal of democratizing insurance for the general public, we are expanding our reach and will continue to build on our tech-based solutions and empowered advisors so that they can serve every village and region of India by the end of the year,” said Agrawal, chief executive officer and co-founder of InsuranceDekho.

Almost 85 per cent of India’s existing insurance premium is centered in metro and Tier 1 cities. InsuranceDekho aims to change that. As part of its mission to provide access to insurance throughout the country, InsuranceDekho gets 82 per cent of its premium from Tier 2 and beyond regions. It is present in more than 1,300 towns.

By the end of this year, InsuranceDekho aims to have more than 200,000 insurance advisors on its platform. It works with most insurance providers and has direct integration with 46 insurance companies across India offering more than 380 products.

Haitong Securities India acted as sole financial advisor for the InsuranceDekho funding round.

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