Narayan Murthy’s Catamaran Ventures invests in Coverfox
Coverfox.com is an online insurance distribution platform that has received funding from N.R. Narayan Murthy’s private investment firm Catamaran Ventures. Coverfox provides comparison of plans from insurance companies, recommendations from experts to buy insurance policies on its portal. The funding will be used to strengthen and grow its online insurance comparison and sales business. Glitterbug Technologies which powers Coverfox has raised a series A round of $2 million followed by a $12 million round from the two existing investors along with Accel US (Coverfox is also a TechSparks 2014 company).
Coverfox was established in May 2013 and has developed a technology based comparison and sales platform. Since the last year when it began operations, Coverfox claims to have witnessed a growth of 500 per cent. Across the insurance categories of car, bike, health, travel and home insurance that it currently offers, Coverfox is registering an overall growth of 40-50 percent month on month with a major contribution from the auto segment (more on this). The portal’s aim for the next six months is to be the largest online auto insurance provider. Coverfox also expects its website traffic to double by the end of the year and reach 1 million visitors per month which implies a claim of 0.5 million monthly visitors currently.
“Insurance in India is a largely under-penetrated market(3.9 percent as against the world average of 6.3 percent). Buying insurance till now has been largely an offline activity. The industry is at the helm of witnessing a massive shift — from being a seller's market to becoming a buyer's market. Coverfox’s mission is to spearhead this change," said Varun Dua, CEO & Co-founder of Coverfox. The company points towards a Boston Consulting Group and Google India report which says that by 2020, 3 in every 4 insurance policies sold will be impacted by digital channels at either pre-purchase stage, purchase or renewal stages. The report states that insurance sales from online channels will touch INR 15,000 Cr by 2020.
“Catamaran chose to partner with Coverfox because we were attracted to the company's customer-oriented approach to insurance distribution built on top of a robust technology platform. The insurance sector will experience significant growth in India and we believe that the company has the opportunity to lead a meaningful change in how customers view, buy and manage their insurance,” said Abishek Laxminarayan, Investment Director, Catamaran Ventures.
Coverfox faces big competition from PolicyBazaar which is backed by Premji Invest with $40 million in its last round and BankBazaar which raised a $60 million series C round. Banks like ICICI are also taking the charge and are taking strong steps towards the transition to online. Bootstrapped companies like PolicyX are also vying for a piece of the insurance cake. Most of the companies in the online insurance space are working towards creating more awareness amongst the consumers and are waiting for a day when an inflection point is hit.