General insurance provider Digit Insurance said it is set to raise $200 million from new investors Sequoia Capital India, IIFL Alternate Asset Managers and existing investor Faering Capital and others.
Digit was the first startup to turn unicorn in 2021 following an $18 million financing round from existing investors in January. The latest fundraise will peg the company at a valuation of $3.5 billion, the company said in a statement on Friday.
After the completion of the latest round, Digit Insurance will have raised a total of $442 million. This financing round is subject to approval from India’s insurance regulator IRDAI, the company said.
According to Digit, it saw a 44% year-on-year growth in gross written premium or GWP to Rs 3,243 crore in FY21. The insurer has more than 2 crore customers and processed over 400,000 claims since its inception in October 2017. The Bengaluru-based company also claimed it saw its GWP grow by 70% between April-May 2021 compared to a 17% growth that the general insurance industry saw.
Digit has maintained its industry-leading growth in the new financial year with robust GWP growth of 70% during April-May 2021, versus 17% for the general insurance industry.
Besides motor and health, Digit focuses on small and medium businesses with products such as shop, property and fire insurance. The company has also strengthened its operations through direct channel partners, including Amazon. Flipkart, Paytm, PolicyBazaar, Cleartrip and thousands of retail agents across India.
Digit competes directly with Acko and to some extent with Coverfox and PolicyBazaar. According to a report in the Economic Times, Acko is in talks to raise $200 million and it could propel the startup towards the coveted unicorn status. PolicyBazaar had become a member of the unicorn club in 2018.