Singapore-based automotive insurance startup Vouch Insurtech has closed a S$1 million ($759,040) seed investment from Taipei-based Nogle Capital Management, GREE Ventures and several angel investors, according to a press release.
Earlier this month, Vouch Insurtech entered into partnerships with three insurance companies in the city-state – NTUC Income, Sompo Insurance Singapore and Tokio Marine Singapore – who will be connected to its digital platform, which provides peer-to-peer (P2P) car insurance to customers.
Founded in late 2016, the company aims to expand this service to Thailand, Malaysia and Taiwan. It claims that traditional car insurance model sees safe drivers penalised with higher premiums to cover the risks of unsafe drivers. In 2017, Vouch was selected by global reinsurer Swiss Re, to participate in their InsurTech Accelerator Programme.
According to the company, its platform aims to “work with insurance companies, to reward safe drivers”, with its P2P insurance purchasing model benefiting insurance companies due to a reduced volume of claims being an outcome of adopting the platform. However, concerns remain regarding the viability of P2P insurance platforms.
“Nogle Capital Management is continuously looking to source best-in-class investment opportunities and is always excited to invest in next-generation technology startups like Vouch Insurtech that have the potential to disrupt the way we live and work,” said Carlos Salas, Managing Partner of Nogle Capital Management, in an official statement.
Nogle Capital Management is the venture investment management which is a fully-owned subsidiary of Nogle Limited. It targets firms operating in the cloud computing, artificial intelligence (AI), blockchain technologies, cybersecurity, and data analytics, among other sectors.
Vouch Insurtech works with its partner insurance firms to offer cash back motor insurance to safe drivers, with up to 15 per cent cash back on top of the no-claim-rebate from insurance companies. This is achieved through the formation of groups with other safe drivers, connecting and pooling customers with comparable risk profiles together.
While insurance technology investments are attracting more investments globally, particularly from re-insurers, as their technical innovations force the alteration of the traditional insurance business models, KPMG predicts that insurtech will gain further momentum this year, with point solutions – such as those offered by Vouch Insurtech – remaining the default for the foreseeable future.
In a statement, Chia Tek Yew, the Head of Financial Services Advisory at KPMG Singapore, highlights: “Insurtechs tend to provide specific point solutions to parts of the insurance chain – and this is unlikely to change. While the industry may see one or two insurtechs in core markets such as Lemonade and Chinese insurtech Zhong An becoming full stack insurers, the failure of Guevara in 2017 demonstrates the challenge of breaking into the insurance market on a large scale.”