Bengaluru-based insurtech startup, Digit Insurance on Tuesday said that it has received the approval from IRDAI to raise $84 million from three growth equity investors - A91 Partners, Faering Capital, and TVS Capital.
The combined investment made in the startup would bring Digit’s total funding to $224 million, to date.
This is the first round of external funding for the startup, which has been raising funds from Canadian billionaire Prem Watsa’s Fairfax Holdings.
In July 2018, Digit Infoworks, the parent company of Digit Insurance, had raised close to $45 million from Fairfax Holdings.
Speaking on the current fundraise, Aditya Parekh, Co-founder and Managing Director, Faering Capital said,
“Our investment in Digit is based on our thesis to back market-leading companies pursuing large opportunities in financial services in India. Digit is uniquely poised to become a dominant player in the general insurance industry, and we are excited to offer our expertise and partner with Kamesh and his team in their exciting journey of delighting customers with innovative yet, simple products and services.”
Incorporated in 2016, Digit Insurance started its operations in November 2017 to make insurance simple.
Within two years of operation, Digit now claims to serve more than five million customers, and has achieved close to $300 million of annualised premium.
Kamesh Goyal, Founder and Chairman, Digit Insurance said,
“We are glad that we have earned the trust of five million customers in just two years of operations. The confidence that our investors and our employees have shown in our mission of making insurance simple, is very heartening. And, this round of funding will further help us in doing that. Happy to be associated with our new investors in our journey to build India’s simplest insurance company!”
In addition to the institutional funding, Digit in a statement said that 72 of the startup’s employees have also invested over $4.34 million along with the investors as part of this round.
Gautam Mago, General Partner, A91 Partners added,
“A91 seeks to partner with founders who are building enduring businesses for tomorrow’s India. We are thrilled to back Kamesh and the team at Digit, who are building a new age insurance company in a thoughtful manner with an admirable mix of simplicity and technology.”
At present, Digit offers a portfolio of products across motor, travel, property, and health insurance.
While, Gopal Srinivasan, Chairman, TVS Capital Fund said,
“From insurance to insurtech – the industry is going through a basic transformation, and Go Digit Insurance is at the cutting edge of this change. With their approach focussed on customer-centricity, prudent underwriting, and technology for operational excellence, we are excited to partner with Kamesh and see the new phase of insurance touch many lives in India, via simplified user experience.”
Digit Insurance faces competition from Varun Dua-led Acko, who was earlier the founder of Mumbai-based insurtech startup, Coverfox.
Last year, Acko raised two rounds of funding – first one in March, where it raised $65 million in Series C funding from Binny Bansal, RPS Ventures, and Intact Ventures, and second in November, where it reportedly raised another $16 million from growth-stage investment firm, Ascent Capital.
Online insurance aggregator platform Coverfox also raised a total of Rs 40 crore ($5.79 million) capital infusion in July 2019, from its existing investors as part of its ongoing Series C funding round.
(Edited by Suman Singh)