As internet penetration grows in India and a young generation of working professionals becomes increasingly comfortable to use the online platform to purchase products and services—from books, banking, payment of bills to buying insurance. The insurance sector is very much a part of this ecommerce growth story with the online insurance space fast gaining momentum.
According to a report by Boston Consulting Group and Google India, three in every four insurance policies sold by 2020 would be influenced by digital channels at either pre-purchase stage, purchase or renewal stages. And insurance sales from online channels will touch INR 15,000 Cr by 2020, with overall Internet influenced sales at INR 300,000-400,000 Cr.
Serving in the same domain with an aim to make the process of buying and managing online insurance easier, simple and transparent, this Mumbai-based startup, CoverFox has just got funded.
The startup has raised $12 Mn from venture capital funds Accel US, Accel India and SAIF Partners in its second round of funding. CoverFox, which represents the new crop of financial tech ventures, uses algorithms to help consumers select insurance products.
The fresh funding will be utilized for further enhancing its technology platform, brand building through mass media advertising, bringing on board new insurance products, and scaling up its customer assistance unit.
Glibberbug Technologies, which runs Coverfox.com, Founded in 2011 by IIT-Bombay alumnus Devendra Rane and Varun Dua, as a venture which used to build technology for insurance firms. After two years, the duo pivoted and started selling insurance online under the brand name Coverfox.
Coverfox had previously raised $2 Mn in a series A round from Accel India and SAIF. It currently sells home, travel, auto and health insurance products.
Speaking on this development, Varun Dua, Co-founder & CEO of Coverfox said, “We believe insurance will see a massive change — from being a seller’s market to becoming a buyer’s market. More choices, niche products, rising consumer awareness, among other factors, will create opportunities in presenting the consumer with choices and a seamless insurance buying experience.”
The startup has seen its revenues and customers double every month. It is looking to sell premiums worth INR 100 Cr by early next year. Coverfox also plans to expand its employee base to 200 from current base of around 50 in the next six months,most of which will be in its technology team.
“The insurance industry in India has lagged behind in harnessing the power of technology and analytics on both underwriting and distribution side. Coverfox brings a refreshing customer-centric focus and technology lead innovation approach in transforming the industry,” said Rohit Jain from multi-stage investment fund SAIF Partners.
Another similar startup, Gurgaon-based eTechAces Marketing and Consulting Pvt Ltd, the company which runs and operate online insurance aggregator, PolicyBazaar, had raised $40 Mn funding in its Series D round from PremjiInvest. It had previously raised $20 Mn in series C, $5 Mn in series B, $4.6 Mn in series A and an undisclosed amount in May 2011.