India-based Insurance technology startup Digit Insurance, a financial services company that provides general insurance services, will raise US$ 200 million at a valuation of US$ 3.5 billion on 2 July 2021. Digit has raised US$ 444.5 million to date.
Investors: Existing investor Faering Capital and new investors Sequoia Capital India and IIFL Alternate Asset Managers are participating in this fundraise, which is subject to approval from the Insurance Regulatory and Development Authority (Irdai). Digit is also backed by Indian cricket team captain Virat Kohli. Digit
The company had raised US$ 18.5 million from existing investors including Faering, A91 Partners, and TVS Capital in January at a valuation of US$ 1.9 billion. This fundraiser makes Digit India’s third most valuable fintech company.
Purpose of the funding: The funding will allow the company to maintain solvency, with an equity dilution of 5% undertaken as a part of this fundraise.
About Digit Insurance
Founded in 2016 by Kamesh Goyal, Philip Varghese, Sriram Shankar and Vijay Kumar, Digit’s services include car insurance, travel insurance, home insurance, commercial vehicle insurance and shop insurance. Its mission is to reimagine products and redesign price processes. Motor insurance is Digit’s largest category, which brings 75% of gross premiums. Fire-related insurance and health together contribute 20%. Due to COVID-19, the share of travel insurance fell below 0.5% last year from 2% previously.
Digit claims that over the past one year it has provided covid-related insurance to almost 3.6 million employees across 32,000 corporations. Since its launch, the platform has provided insurance to more than 20 million customers and processed 400,000 claims.
What the founders have to say: “In the first quarter of this year, we grew by 60% (in terms of gross premiums) compared to the same period last year, and this is largely coming from the health insurance business. Further, we overall grew 70% in April and May versus the industry growth of 17%. For health, the growth is primarily driven by covid-related insurance products. Now, we will look to offer newer health cover products during this financial year as we look to expand our on-ground coverage to newer Indian geographies this year.” — Kamesh Goyal, founder of Digit.
What the investors have to say: “It was a difficult year for economies the world over but I am glad to see Digit continuing to stick to its mission of simplicity and growing ahead of the industry. Their relevant products, tech-enabled, simple processes, and customer-centric approach sets them apart.” — Prem Watsa, chairman of Fairfax Financial Holdings.
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