The company raised its first external funding round last year at a valuation of $870 Mn
It has raised about $200 Mn till date from A91 Partners, Faering Capital, TVS Capital and others
Digit Insurance claims to have noted a 31.9% growth rate in the last nine months
Bengaluru-based insurtech startup Digit Insurance has become the first Indian startup to enter the unicorn club in 2021, after raising INR 135 Cr ($18 Mn) from existing investors at a valuation of $1.9 Bn. It has raised the funding as growth capital to meet the solvency margin requirement, following a 31.9% growth in the last nine months.
Digit Insurance has raised about $200 Mn till date from marquee investors A91 Partners, Faering Capital and TVS Capital, which own about 11% stake in the company. It raised its first external funding round last January at a post-money valuation of about $870 Mn. The company had raised $84 Mn (INR 614 Cr at current conversion rate) as a part of this round, in which Indian cricketer Virat Kohli and Bollywood actor Anushka Sharma infused about $340K (INR 2.5 Cr).
Before this, the company relied on an internal capital infusion from Kamesh Goyal and Prem Watsa’s Fairfax Holdings, the founders of the company. The promoters have invested more than $142 Mn in Digit Insurance in 2017 and 2018, and own about 88% stake in the company. “Our strategy was to simplify products and process and back it up with good service. This is working for us to achieve growth,” Goyal explained.
Founded in 2016, Digit Insurance is a tech-driven general insurance company that offers customised policies on health, auto, travel, smartphones, commercial properties such as stores and holiday homes. It expanded its business during the pandemic by offering new products like fixed benefit cover for Covid-19 under Insurance Regulatory and Development Authority’s (IRDAI) sandbox initiative.
The company claims that it was about to reach out to more than 20 Lakh Indian through their Digit Group Illness Insurance product, which offered protection against Covid-19 and 7 Vector-borne diseases like dengue, malaria, filariasis, ala azar, chikungunya, Japanese encephalitis and the zika virus.
According to an IBEF report, the Indian insurance industry was expected to reach $280 Bn by the end of 2020 and grow at a compound annual growth rate (CAGR) of 12-15% over the next three to five years. The market is expected to grow as the Indian government pushes for insurance penetration and proliferation of insurance schemes. According to BlackSoil’s cofounder and director Ankur Bansal, the insurtech will be a favorite among investors in 2021 as the segment is expected to grow.