Coverfox, an online insurance brokerage firm, is reportedly looking to shift its business focus towards term life insurance. Interestingly, the vertical of term life insurance was launched by Coverfox just a couple of months ago.
The company’s shift in business comes at a time when it is now aiming to capture over half of the online insurance business market. Coverfox CEO Premanshu Singh said,
In two years, we expect life insurance to contribute to 50% of the overall business revenues. In terms of premiums, life insurance helps the revenue growth better.
The term life insurance business currently contributes to less than 1 percent of the entire revenue pie. Majority of its topline is being generated by motor insurance policies that the company aggregates.
Premanshu Singh, who is currently the chief executive of Coverfox, was formerly the head of marketing at healthcare firm Practo. He took over the CEO role at Coverfox after co-founder Varun Dua moved out to start his digital general insurance firm Acko.
With focus towards life insurance, the company is planning to grow its revenues by three times. Singh said that they “should be clocking Rs 300-crore worth of premiums by December from the Rs 100 crore we did last year.”
Acko was registered in August last year under its parent company Acko Tech. Earlier this year, the company received an in-principle regulatory clearance to launch a general insurance business in India. Varun Dua, who had founded Coverfox with Devendra Rane, left the company and moved to Acko.
The startup has also raised about $30 million in its seed funding round from the likes of Narayana Murthy and Kris Gopalakrishnan; Hemendra Kothari, Atul Nishar; and Rajeev Gupta, along with VC firms SAIF Partners and Accel India. It was touted as the first major funding round for a startup in the insurance tech space.
Life insurance business offers Coverfox a higher commission rate of 20-25% as compared to the 12-15% it rakes in through motor insurance. The firm is looking to grow the quantum of life insurance policies sold monthly from the current 500 to 5,000 by March 2018.