Insurance brokerage firm Coverfox raises $15 mn from Transamerica & others

MUMBAI | NEW DELHI: Glitterbug Technologies, which owns and operates online insurance brokerage Coverfox, has raised about Rs 96 crore ($15 million) in its series-C round, led by US insurer Transamerica, with its existing investors also participating.

The Mumbai-headquartered company, which competes with the likes of Tiger Global and PremjiInvest-backed PolicyBazaar, as well as Unilazer Ventures-backed EasyPolicy, is also in discussions with Fosun Kinzon Capital, the VC unit of Chinese conglomerate Fosun International, according to multiple sources.

The Chinese investment company, which recently picked up stakes in technology-focused logistics company Delhivery and online travel search engine Ixigo, has been in negotiations with the Coverfox management, which if successful, could see it invest $5-10 million, in what could be an extension of the latest round.

The latest round of equity financing values Coverfox between $70 million and $100 million, according to one of the sources cited earlier. Its current list of investors include SAIF Partners, Accel India and Catamaran Ventures ­ the family office of Infosys co-founder, NR Narayana Murthy.

Separately, according to a second source, Fosun, along with other investors, could also invest in Acko General Insurance, the company launched by Coverfox cofounder Varun Dua last year.

Dua, who quit as Coverfox CEO last year to head Acko, had told ET in February that it had begun conversations with new and existing investors for Coverfox's next ro und of funding.

Acko announced a $30-million fund raise, in what it called a seed round last month, from a clutch of investors, including SAIF Partners, Accel Partners, Catamaran Ventures, former Infosys chief executive Kris Gopalakrishnan and Hemendra Kothari, chairman of DSP Blackrock.

In January, ET reported that Acko had applied to the Insurance Regulatory and Development Authority (IRDA) to set up a general insurance company.
Emails sent to Coverfox, Acko, SAIF Partners and Accel Partners did not elicit any responses at the time of going to press.

In response to ET's email query, Ajay Lakhotia, Partner at Fosun Kinzon Capital declined comment on the specific transaction with Coverfox.

He, however, said that insurance is a key area of interest for the Fosun Group. "We have done multiple acquisitions across the globe and are exploring the insurance sector in India at a broad level," Lakhotia told ET.

Coverfox, which has largely kept away from the life insurance segment, barring a listings-based model, is now actively considering its entry into the space. Sources told ET that the fresh funding raised by the company is likely to hasten its entry into the segment.

So far, Coverfox primarily focuses on the bike and automobile insurance segment, which contributes over 50% of its overall revenue. It clocked premiums of Rs 140-150 crores for the financial year 2016-17.

The auto insurance vertical has been a hotly contested segment within the broader insurance industry. In April, Girnar Software, which owns and operates CarDekho, also acquired a licence from IRDA, and launched Girnar Insurance Brokers, with a core focus on auto insurance.