InsuranceDekho, the insurer that was incubated within the automobile marketplace group CarDekho, has raised $60 million in a new funding round as the startup looks to supercharge its growth.
Mitsubishi UFJ Financial Group, insurer BNP Paribas Cardif, Beams Fintech Fund and Yogesh Mahansaria Family Office financed InsuranceDekho’s Series B funding, valuing the Indian startup at over $600 million.
Wednesday’s funding is the second financing round for InsuranceDekho, which also counts Goldman Sachs and TVS Capital among its backers. The startup, more than half of which is owned by unicorn CarDekho, raised a $150 million funding in February this year.
InsuranceDekho works with most insurance providers in the country and has direct integration with nearly four dozen firms through which it offers over 400 insurance products. The coverage on automobiles is currently the most popular insurance product the startup sells, it said, as it gears up to expand into health and life categories as well as serving the small- and medium-sized enterprises.
India’s current insurance penetration remains below 5% of the GDP, compared to 12% in the U.S. An average Indian makes about $2,100 in a year, according to World Bank. The rating agency ICRA estimated that of those Indians who had purchased an insurance product, they are spending less than $100.
The startup has established a presence in about 98% of all zip codes in the nation, giving it an opportunity to go deeper as the market matures. It sells more than 80% of all its coverage in smaller Indian cities.
InsuranceDekho co-founder and chief executive Ankit Agrawal told TechCrunch in an interview that the startup is on track to sell $432 million worth of premiums in the current financial year and its core business is profitable. “We are continuing to expand into new business lines,” he said.
The startup already had years of runway and didn’t need the fresh capital, but Agrawal said he is always open to working with high-quality investors. He said the funding deliberation for this round took just four weeks to complete.
InsuranceDekho currently relies on more than 150,000 gig economy workers, called “agents,” to educate the market and sell insurance coverages. These workers also answer the questions that prospective customers have about the policies.
Scores of firms, including Digit, which is looking to go public, listed firm Policybazaar, and Amazon-backed Acko as well as Paytm and PhonePe, sell insurance products in India. The arrival of fintech giants in the category, Agrawal argued, is indicative of the market size and opportunity.
“Our entry into the insurtech sector signifies a strategic commitment to increase insurance accessibility in India. InsuranceDekho’s tech-driven last-mile distribution model perfectly aligns with our vision of advancing insurance outreach in India,” said Shashank Joshi, Deputy CEO of MUFG Bank in India, in a statement.