Insurance tech startup Acko General Insurance Ltd., backed by Amazon, is reportedly considering a new funding round that could value the Indian digital insurer at more than $1 billion, according to sources. The funding round, if successful, will crown Acko the latest unicorn in India.
The Amazon.com Inc. backed startup is looking to raise about $200 million in the round, said sources aware of the developments. Acko is also considering a public listing as soon as this year, one of the sources said. In April, India minted at least six new startups with a valuation of $1 billion or more in a week.
If the funding round comes through, Acko would be the 12th Indian startup to enter the unicorn club this year. This after India saw six startups, namely Groww, Gupshup, Cred, ShareChat, PharmEasy, and Meesho, become unicorns in April.
Digital Insurance platform
Acko, founded in 2016 by Varun Dua and Ruchi Deepak, is among India’s first digital insurers that provide coverage for cars, motorbikes, and even taxi passengers as well as health insurance, according to its website. Acko offers bite-sized insurance products for drivers and others working in transportation and related sectors.
The company recently expanded its catalog and began offering similar policies in healthcare. As of last year, Acko claimed to have provided 650 million policies to 60 million unique customers to date. It has more than 400 employees. Besides Amazon, the startup also counts Accel, Catamaran Ventures, and SAIF Partners among its investors.
While Acko primarily relies on a direct-to-customer (D2C) approach for selling its insurance policies, it also sells them through Amazon. Last year, Amazon’s digital payments venture Amazon Pay entered the insurance distribution business by partnering with Acko.
In recent times, the dawn of insurance tech startups such as Acko, Coverfox, Toffee Insurance, Digit Insurance, Insure First among others is changing the dynamics of this industry.
According to a report by the Indian Brand Equity Foundation, the market share of private sector companies in the non-life insurance market rose from 15 percent in FY04 to 56 percent in FY21 (till April 2020). In the life insurance segment, private players had a market share of 31.3 percent in new business in FY20 and the use of emerging technologies will drive the next phase of growth for this sector.