A clutch of senior executives from the e-commerce and insurance space have come together to float Digit, a tech-driven insurance startup, a national daily reported on Tuesday.
Former top-level employees of general insurance company Bajaj Allianz Vijay Kumar, V Philip and Jasleen Kaur; former senior vice president - marketing at Snapdeal Sandeep Komaravelly; and former vice president - customer experience at Myntra Sriram Shankar are driving critical functions at the startup, The Times of India reported.
Bangalore-based Oben General Insurance Ltd, which runs the venture, has received preliminary approvals from the Insurance Regulatory and Development Authority of India, Komaravelly told the paper, adding the plan was to launch in 6-12 weeks.
Digit has secured the backing of Canadian billionaire Prem Watsa’s Fairfax Holdings, which has partnered former Allianz executive Kamesh Goyal for the venture. The startup will begin with a paid-up capital of Rs 385 crore, and Fairfax will control 45% of the firm while the balance will be held by Indian investors led by Goyal, the report added.
Fairfax's move isn't unexpected as just last month it agreed to sell a 12.18% stake in ICICI Lombard General Insurance Company Ltd for about $383 million as part of a plan to float a new insurance joint venture. The proposed transaction valued India’s largest private general insurer at Rs 20,300 crore (about $3.1 billion).
ICICI Lombard was set up in 2001 as a joint venture between ICICI Bank, India’s largest private-sector lender, and Fairfax. Its valuation has surged over the past few years, as India’s general insurance market expanded at a quick pace thanks to rising vehicle ownership and growing awareness about home and health insurance.
Fairfax has made sizeable investments in more than half-a-dozen Indian companies across sectors. It launched an India-dedicated vehicle, Fairfax India, in November 2014. In January 2015, Fairfax India floated a public offering in Canada to raise $1.06 billion. In January this year, the firm mobilised another $500 million to invest more in India.
Overall, Fairfax has made equity investments of about $1.24 billion since August 2015, when it put in money in National Collateral Management Services Ltd, its annual report shows. It also has significant minority stakes in financial services group IIFL Holdings Ltd and Sanmar Chemicals Group.
Last month, Mumbai-based online insurance startup Acko General Insurance Co. Ltd had raised $30 million (Rs 195 crore) in seed funding from a clutch of investors including SAIF Partners and Accel Partners. Acko will operate as an independent general insurance company with its entire operations offered through the digital platform.