Wellington Management Leads $77 Mn Funding Round In Online Insurance Aggregator PolicyBazaar

Online insurance policy aggregator PolicyBazaar has raised $77 Mn (INR 500 Cr) equity funding in a round led by global asset management firm, Wellington Management. The round also saw participation from IDG Ventures India and PE firm True North.

A clutch of existing backers, including Tiger Global Management, Singapore government-run Temasek and PremjiInvest, also joined in.

Commenting on the development, PolicyBazaar founder and CEO Yashish Dahiya said, “The latest funding round is a testimony of the trust that our stakeholders – be it investors, insurers or partners –  have shown in our vision to empower the consumer with right knowledge to buy a relevant product for themselves. The funding only opens up avenues for us to further innovate, look at geographical expansion and rally strongly behind creating mass awareness for consumer-centric protection products – term (pure life insurance), health and disease-specific products. We would also continue to invest in technological solutions that ease the whole buying process for consumers which in turn enhances their experience. ”

Post the fundraise, the valuation of PolicyBazaar stands at $500 Mn, sources revealed. The financing, as per reports, will be spent on accelerating the Gurugram-based startup’s expansion across international markets, in particular, the Middle East, by the end of 2017.

The latest funding round comes three months after it was reported that Wellington Management, which previously backed companies like Airbnb and Pinterest, was in advanced talks to invest in the online insurance aggregator.

Headquartered in Boston, Wellington currently boasts more than $1 Tn worth of assets under management. Interestingly, this would be the firm’s maiden investment in an Indian privately-held technology company.

PolicyBazaar: From Its Inception In 2008 To Breaking Even In FY17

Owned and operated by Gurugram-based eTechAces Marketing and Consulting Pvt Ltd, PolicyBazaar was started in 2008 by IIT Delhi and IIM Ahmedabad alumni Yashish Dahiya, Alok Bansal and Avaneesh Nirjar. ETechAces also runs PaisaBazaar, which is a marketplace for loans and credit cards.

As its name suggests, PolicyBazaar serves as an online portal for life insurance and general insurance comparison. It features products from all major insurance companies in India, helping users zero in the insurance policy that best suits their needs. The company also facilitates online purchase of insurance policy for those who are seeking both life insurance and non-life insurance.

As per a recent report by ET, Dahiya claimed that the company had broken even during FY17, after chalking a total revenue of $33.8 Mn (INR 220 Cr) in the said period.

How The Online Insurance Aggregator Raised $154 Mn To Reach $500 Mn Valuation

So far, the online insurance policy aggregator has raised over $154 Mn (INR 1,000 Cr) across multiple rounds. The company raised $20 Mn Series C funding in a round led by Tiger Global in May 2014. Earlier, it had secured $5 Mn in Series B, $4.6 Mn in series A and an undisclosed amount in May 2011.

Later in December 2014, PolicyBazaar was reportedly looking to raise $61.6 Mn (INR 400 Cr) investment from Premji Invest, the investment arm of Wipro Chairman Azim Premji, and San Francisco-based Iconiq Capital. The deal was expected to see participation from existing investors Tiger Global and Kanwal Rekhi-led Inventus Capital Partners.

A couple of months later, in March 2015, it was reported that  PolicyBazaar was in talks to close a $46 Mn (INR 300 Cr) funding round led by PremjiInvest and the Steadview Capital. As per media reports, this round was to take place at a valuation of about $184.7 Mn (INR 1200 Cr).

In April of the same year, the online policy aggregating startup raised $40 Mn funding in its Series D round from PremjiInvest. The round also saw participation its existing investors Tiger Global and Ribbit Capital. Besides these, the round also attracted money from Steadview Capital and ABG Capital. At the time, it was reported that the funding would be used for upgrading the technology, marketing and building out the company’s recently launched platform PaisaBazaar.com.

In October 2015, Temasek Holdings was reportedly in advanced talks to invest in the online insurance policy aggregator by acquiring a stake indirectly from its existing shareholder, Info Edge. As part of the deal, Temasek, through its Singapore-based indirect wholly-owned subsidiary MacRitchie Investments Pte Ltd, agreed to acquire about 49.99% equity stake of MakeSense Technologies Ltd, for about $20.58 Mn( INR 134 Cr).

Most recently, in March 2017, reports surfaced that PolicyBazaar was preparing for an IPO by the end of 2018, which means that the latest fundraise could be a pre-IPO round. Email queries sent to the company, however, did not elicit a response till the time of publication.

What’s Been Happening In The Indian Online Insurance Sector

In the online insurance segment, PolicyBazaar currently competes against a bevy of promising players, including Coverfox, Easypolicy, Turtlemint, and BankBazaar, among others.  In February 2017, Times Internet launched an online insurance distribution platform ETInsure.

In May, Acko General Insurance secured $30 Mn in a Seed round of funding. The investors included Narayan Murthy’s Catamaran Ventures; Venk Krishnan and Subba Rao of NuVentures; Kris Gopalakrishnan; Hemendra Kothari of DSP Blackrock and Atul Nishar – founder & Chairman of Hexaware Technologies.

Later in June, Mumbai-based online insurance brokerage platform Coverfox reportedly raised about $15 Mn (INR 96 Cr) in Series C round of funding. The round was led by US insurer Transamerica, along with the participation of existing investors.

The Indian fintech market, currently standing at $1.2 Bn, is forecasted to touch $2.4 Bn by 2020. The latest funding from Wellington Management, IDG Ventures India and others will enable PolicyBazaar to thwart competition from a growing number of online insurance aggregators.