A significant part of the investment ($44 million) will be injected into Digit Insurance, the startup said in a statement. Digit Insurance plans to invest the funds in technology to drive its mission of making insurance simple, besides launching new lines of products and expanding distribution network across the country.
The current round takes Bengaluru-based Digit’s total funding to $94 million, the statement added.
“Our long-term investment is directed towards bringing in technology that can automate and fasten processes and resolve customer pain points. For example, 100% of our flight delay claims are automated and claims are processed in minutes; 87% of our claim approvals happen in just 24 hours due to innovations like smartphone-enabled self-inspections. We also believe that claims are the sole reason why a customer buys our policies, so for us claims are good,” Kamesh Goyal, Founder & Chairman, Digit Insurance said.
Digit Insurance has partnered with companies such as Flipkart, Paytm, Cleartrip, Sterling Holidays, PolicyBazaar and Tanishq, among others, for products related to mobile phones and flight delays. The insurer claims to have diversified into mobile, car, 2W, travel, jewellery
insurance and built a large base of over 4 lakh+ customers in a span of six months.
Digit was started by Goyal, a former Allianz executive who led the German insurer’s business in India, with backing from Farifax last year in June. The startup then started with a capital base of around 350 crore. At that time, Fairfax Holdings was holding 45 per cent shareholding in the company while the balance shareholding was with Indian investors led by Goyal.
Digit Insurance had reportedly acquired privately owned reinsurer ITI Reinsurance from Fortune Financial Services, an associate of Sun Pharma’s Dilip Shanghvi, for about Rs 500 crore last month.
Fairfax is a holding company which, through its subsidiaries, is engaged in property and casualty insurance and reinsurance and investment management. Watsa had launched Fairfax India in November 2014. The company had sold 12 per cent of the shares in ICICI Lombard General Insurance for about $548 million as part of the latter’s IPO in September last year.
Earlier this month, Fairfax also announced that it had secured $550 million as one-year secured term loan from a syndicate of Canadian banks. In March, the company also signed an agreement to acquire an additional 6 per cent shares of Bangalore International Airport Ltd for around $67 million, making it the majority shareholder in the airport operator.
In December last year, the Indian arm said it is looking to raise up to $1.5 billion to intensify its investments in India.