Laka, a UK-based insurance startup, has raised $1.5 million in a seed round of funding led by Tune Protect Group Berhad, a financial holding company listed on the Malaysian Stock Exchange, said an announcement.
Silicon Valley-based venture capital firm 500 Startups also participated in the funding round alongside new and existing angel investors from across the insurance industry, a company statement said.
The funding proceeds will allow Laka to further extend its reach across the UK and eventually bring its insurance model to Asia.
Laka currently focuses on insuring high-end bicycles in the UK and is preparing to launch further lifestyle products in the next year.
“Despite its young, tech-savvy population, emerging Asia is heavily under-insured due to a lack of product offerings and access. To put this in perspective, it holds 43 per cent of the world’s population but accounts for just 13 per cent of total premiums. Laka will leverage the learnings from building a leading lifestyle insurer in the UK in tackling the issue of underinsurance in this large, dynamic market,” said Laka co-founder Tobias Taupitz.
Founded in 2017, Laka claims to have developed an insurance model in which customers only pay for the true cost of cover. At the end of each month, the cost of claims is split between customers, with the individual’s maximum premium capped at market rate for customer protection. It further claimed that its users have saved more than 80 per cent compared to market prices.
Incorporated in 2011, Tune Protect, through its subsidiaries, associates and joint ventures in Malaysia, Thailand and United Arab Emirates, underwrites, directly and via reinsurance, general insurance business. It is also the exclusive manager of AirAsia’s entire insurance business including travel insurance.
500 Startups has invested in over 2,000 companies via its four global funds and 14 microfunds. In Southeast Asia, the firm has invested in and supported over 160 companies through its 500 Durians Funds. It counts Singapore-based ride-hailing company Grab and C2C e-commerce platform Carousell among its portfolio companies.