Update on InsurTech in India (Q3 FY 21)
WhatsApp entering Insurance, deal heat at the early stages and much more in this quarterly review!
With $37.74M in primary capital entering the ecosystem across 7 deals, this quarter has been rather active on the ‘early’ stage.
Plum is the employee benefits partner in the Razorpay ecosystem (RazorpayX is their SME neo-banking offering and Opfin is their payroll management system).
Plum is (unsurprisingly) the employee benefits partner for Surge
Loop Health (primary care + health insurance) raised $2.3M; also a Y Combinator alumni!
On to some more fund raising:
Turtlemint (B2B2C insurance distribution via agents) raised $30M
They’ve crossed 1.5M customers serviced via their agents
20,000 advisors use their content & education platform monthly (MAU)
Fedo (software for pre-purchase in insurance) raised $1M
Medical fraud at the time of purchase (‘underwriting’) is a major problem in both Life and Health Insurance.
Fedo has a proprietary facial analysis model to help insurers in the underwriting process.
There are a couple of other financings within Q3 FY 21 which haven’t been made public (including ours). Since I have an ‘insider’ perspective on these, I will not mention them :)
II. Regulation as an enabler
If you’re not keen to delve into the regulations, feel free to scroll past the next 2 images where you’ll find a summary!
PS - The standard products cited above are each terrific in their own right.
Summary of key regulations (“What should I take away from this?”)
Standard products will drive future innovation
Standard products fit perfectly in the mental model of UPI for X.
At BimaPe, we’ve done some of the ‘plumbing’ work with regards to making insurance policies machine readable (for comparison purposes). Standard policies (across benefits, definitions etc) would be a boon to everyone in the ecosystem.
The “NBFC for Insurance”
The IRDAI is reviewing a proposal to launch dedicated micro-insurance companies.
Put simply - lower capital requirements, narrower scope of products and an opportunity for cooperative societies (self-help groups etc) to become insurance underwriters.
I covered two different models (which I term ‘Algorithmic Underwriters’) in a previous piece here.
We’re about half way through - short break! If you have found this write-up useful so far, please do consider subscribing (if you haven’t already) -
III. Key news from the ecosystem
a. WhatsApp is slated to enter insurance distribution
In partnership with SBI General Insurance, WhatsApp is launching insurance products in 2021. From my perspective as a D2C Insurance operator, WhatsApp is the perfect community management and insurance distribution platform; as I have tried to convey below:
For the extended piece on WhatsApp & Insurance, click here
b. Why doesn’t anyone talk about Navi Insurance?
A quick glance at the website of Navi Insurance suggests that they are looking to double down on the health insurance market.
PS - for readers who are not familiar, Navi is a holding company set up by Sachin Bansal (Flipkart Co-Founder) to aggregate his investments - including CRIDs (which is rumoured to be gunning for a full banking licence)
However, you should keep your eyes out for a potential entry by Navi into Life Insurance:
Navi filed a bid for DHFL’s stake in DHFL Pramerica Life Insurance ; deal size of $108M.
Navi is rumoured to be buying Aviva’s stake in Aviva Life Insurance India  - as a side note, this is part of Aviva’ strategic retreat from Asia; deal size of $162M.
As a side note, Paytm has also filed a bid for DHFL’s stake in Pramerica Life Insurance. Paytm has purchased Raheja QBE Insurance. For both Paytm & Navi, getting a Life Insurance unit would make them “full stack” across all insurance verticals.
In my personal view, both Navi and Paytm will be interesting players in the InsurTech ecosystem owing to the locked-in distribution they can tap into; especially for Paytm which sits on top of 4+ years of payments and e-commerce data of its user base.
c. PhonePe on fire
PhonePe starting doubling down on insurance in January 2020 (per my observations looking at their UI changes). The company has 258M users and boasts of some mind-boggling statistics regarding insurance:
11M insurance premium payments processed in 2020 [i]
500,00 insurance policies sold in a 5 month window (April to August 2020) [ii]
PhonePe launched car insurance on their platform recently.
PhonePe will be an interesting company to watch in digital insurance distribution - Paytm acquired an insurance company and has its own insurance brokerage licence. Will PhonePe adopt a similar approach? I think they might go down the brokerage route only.
Q3 FY 21 has been rather busy - fundraising and regulatory impetus for innovation. I am excited for Q4 FY 21. I haven’t been very focused on InsurTech Tribe due to my commitments at BimaPe but I will aim to be more regular here.
I look forward to your thoughts, comments and feedback. Please feel free to reach out to me @Rahul_J_Mathur
If you’re still here, you’re a legend! I’ve got some bonus content for you:
The wild December start for InsurTech funding:
And, even more global InsurTech funding:
Views expressed herein are the authors own and do not represent those of BimaPe Inc, its management, shareholders or customers. Contents here are for informational purposes only and should not be construed as legal, financial or any other form of advice.
Discover the hidden insurance benefits on your card here (no card number required) with BimaPe; join 3,500+ BimaPe members today!
We’re building on the India Stack (Account Aggregator, National Health Stack and UPI 2.0) to deliver a consumer-friendly digital insurance product. We’re hiring for x4 roles here