Insurtech startup Bimaplan announced that it has raised $2.5 Mn as part of its pre-Series A funding round with participation from
The round saw participation from global VC funds like Amino Capital, Goodwater Capital, Acequia Capital, and Emphasis Ventures (EMVC). The round also saw participation from angel investors like Gokul Rajaram of Doordash, Arjun Sethi of Tribe Capital, Ashish Dave of Mirae Asset Venture Investments and others. Existing investors RaSa Future Fund, Dream Incubator, 2am Ventures, Samyakth Capital, and Shanti Mohan and Nimesh Kampani of Letsventure also participated in this round.
Founded in November 2020 by Vikul Goyal, the Bengaluru-based startup had raised $500K in a seed round in March, which saw participation from Y Combinator, FinSight Ventures, Kunal Shah of CRED, Jitendra Gupta of Jupiter, among others.
The startup works with insurers to create over-the-counter (OTC), low-premium insurance products to cater to low- and middle-income people with annual premiums in the range of INR 350-3,500 ($5-50). Bimaplan’s insurance partners will underwrite all policies, but these will be co-branded and distributed by the startup.
“Insurers are still selling a version of the same lifestyle insurance products to the lower income demographic that they sell to the affluent segments of the population. This lack of customisation is why insurance penetration has remained low in our target segment. At Bimaplan, we understand our users’ perception of risk and create products mitigating that risk, and this is what we endeavor to build at scale,” said Vikul Goyal, Founder and CEO at Bimaplan.
Bimaplan will utilise this funding to build the team, product, and ramp up distribution. Speaking to Inc42, Goyal added that Bimaplan has strengthened its core leadership team since the last funding round with the hiring of Chandan Mittal as chief technology officer and Gaurav Jindal as chief operating officer. Mittal has earlier worked with Amazon, and startups like Sharechat and Udaan and brings his experience of building consumer products for Tier-2/3/4 audiences. Jindal earlier worked with Apple in strategic operations and business development in the US and will help drive product innovation in order to redefine the insurance experience for the Indian consumer, said Goyal.
American academic and economist Prof. Tarun Khanna of Harvard Business School also joined the Bimaplan advisory board. The company is also working towards strengthening its B2B sales teams.
Commenting on the fundraise, Melissa Frakman, Managing Partner of EMVC said, “The pandemic has made it abundantly clear that insurance is ready for its “UPI moment” in India just as payments and small business solutions last year. The future is bite-sized affordable policies that provide financial stability delivered as conveniently as a WhatsApp forward.”
Bimaplan recently launched its insurance-in-a-box product which allows its partners to sell embedded insurance products to their customers seamlessly. This product will reduce the need for extensive training of resellers or agents, added Goyal. Bimaplan has started pilots with 5 strategic partners which range from fintech startups to traditional financial services companies. Bimaplan is in talks with multiple partners across verticals, and will be launching more pilots in the coming months.
Overall insurance coverage across the country has been historically low, reaching 3.76% in 2019 from 2.71% in 2001, according to the Economic Survey 2020-21. Although lack of awareness is one of the key reasons behind low insurance penetration in India, the high cost of distribution and high premiums have limited its growth to a premium user base. This is one of the reasons that, following the success of UPI, insurtech startups and tech companies are exploring the micro-insurance segment in order to take the product to the masses.