Acko Insurance - Insurance Company
Founded in 2016, Acko Insurance is one of India's first digital-native insurers.
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Founded in 2016, Karnataka-headquartered Acko Insurance is India’s leading Insur-Tech company that offers insurance policies through its digital platform. Alongside policies, it also provides bite-sized innovative products to consumers by partnering with tech companies.
Acko Insurance has revolutionized the insurance industry by digitalizing it with zero paperwork hassle. The company claims to be the fastest-growing insurance company in India by serving over 70 million customers and clocking $175M in premiums annually.
In 2021, the company entered the unicorn club after raising $255M in a Series D funding round led by General Atlantic, bringing its total valuation to $1.1B. It is backed by notable investors like Amazon, Accel, Catamaran Ventures, SAIF Partners, and Swiss Re Transamerica Ventures. Moreover, to launch its innovative products, it has partnered with leading brands like Ola Cabs, Zomato, Amazon, redbus, Rapido Bike Taxi, and OYO.
Business Overview & Products
Acko General Insurance provides insurance products in the following categories:
Car & Taxi
The company operates digitally across India but has no physical location.
How It Works
Acko Insurance is a digital platform that provides insurance policies for cars, taxis, bikes, health, and electronics. Moreover, the company also develops innovative bite-sized products by partnering with online commerce platforms. These products include driver protection, ticket cancellation insurance, and rider protection. For instance, the company partnered with Amazon Pay to provide customers with car and bike insurance with zero paperwork. The buying process is seamless as the policy can be purchased within a few minutes and also includes a one-hour pick and three-day assured claims servicing for vehicles.
The platform has also partnered with Ola Cab to provide customers cover for loss of baggage, emergency hotel requirements, missed flights and loss of a laptop, etc. These policies of INR 5 lakh ($6,610) can be availed for INR 1 ($0.013). The collaboration also allows users to opt for an in-trip insurance cover while booking an Ola ride.
The platform offers customers a seamless and convenient platform with no offline hassle. Without the paperwork, everything from purchase to claims and renewals is done digitally. With an online insurance model, the company is able to carry out better data-backed underwriting and process claims quicker. All of this leads to a low cost of acquisition as well as sales.
The company also customizes pricing by leveraging the vast amount of industry data available from organizations such as the Insurance Information Bureau. These sources provide national-level data on cohorts, cars, location, region, historical claims ratio, and more. For instance, bike owners who have a history of fraud claims are offered higher prices, while lower prices are quoted to customers with good driving history.
Business Model & Pricing
Acko insurance has a direct-to-consumer approach where it offers insurance policies to consumers via its online platform. Moreover, it provides bite-sized insurance products like ticket cancellation, mobile protection, and rider insurance by partnering with major tech companies.
The company’s digital model does not involve any third-party agents and as a result, Acko Insurance incurs less expense and passes on the savings to consumers in the form of low premiums. The company earns money through its insurance schemes.
Acko Insurance witnessed a 120% growth in sales of insurance policies for automobiles in the first quarter of 2021 as compared to 2020. It also posted $10M in Gross Written Premium in the first quarter of FY22, which is a 1.16% growth from the same quarter of FY21.
The company reported 3X growth in annual revenue to $26M in 2020 from $8M in 2019. In 2020 they also witnessed 688% increase in claims, from 1,95,695 in 2020 to 24,831 in 2019. Moreover, new customer growth increased by 2.5x in metro cities and by 3.5x in non-metro cities.
To date, the company has provided 800 million insurance policies to over 62 million unique customers and their app has been downloaded more than 1 million times. The website was reported to have over 4 million monthly users and reported a consistent increase in traffic by 161% in the April to June quarter of FY22.
Varun Dua (LinkedIn): CEO and Co-Founder at Acko Insurance. Prior to launching Acko Insurance, Varun also founded GlitterBug Technologies and Coverfox Insurance. He also worked as Marketing Manager at Franklin Templeton Investments and Tata AIG Life Insurance.
Ruchi Deepak (LinkedIn): Co-Founder at Acko Insurance. Ruchi has also served as a Board Member at Pitstop, a platform that offers general repair and maintenance services for cars through its doorstep service.
History & Evolution
In 2016, Acko Insurance was founded by Varun and Ruchi claiming to be the first digital insurance service provider in India.
In 2017, the company received its license from the Insurance Regulatory and Development Authority of India (IRDAI).
In 2018, Acko Insurance partnered with Ola Cabs to provide in-trip insurance to their customers in more than 110 cities in India.
In 2019, the company received the ‘Golden Peacock Innovative Product Award’ for its bit-sized insurance product, Ola Ride Insurance.
In 2020, Acko Insurance partnered with Amazon Pay to provide auto insurance policies to their customers. The company also partnered with HDB Financial Services to offer microinsurance on HDB Aabhar Cards (EMI cards).
In 2021, Acko Insurance concluded its first Employee Stock Ownership Plan (ESOP) liquidity program. It was valued at $2M for 40 employees who have served long-term at the organization.
According to a report by TechSci Research, the Indian digital insurance industry is estimated to reach $165.02B by 2024 at a CAGR of over 13% from 2019 to 2024.
In India, the digital influence on insurance sales is 13% for life insurance, 15% for health insurance, 9% for motor insurance, and 21% for travel insurance. Roughly, $1B of new insurance sales are digitally influenced.
Acko Insurance mainly stands out from its competitors because of its digital direct-to-consumer model. The company claims to be the first fully digital insurance provider in India that deals directly with customers, without involving a middleman or agent. This in turn makes its operations cheaper than other rivals and the company is able to provide 30-40% discounts on premiums.
For IPL 2022, Acko Insurance has signed 5 teams including Delhi Capitals, Mumbai Indians, Sunrisers Hyderabad, Kolkata Knight Riders, and Gujarat Titans as its sponsor.
Suggested Next Reads
Can Digital Insurance Startup Acko Disrupt The Complex Sector? (Rajiv Singh, Forbes India, Dec ‘20)
Digital adoption helps ACKO auto insurance business grow 120 percent over one years (Business Standard, July ‘21)
Acko – A Silent Storm Disrupting The Insurance Market (Sourav, Next Big Brand, July ‘19)
Why Amazon has invested $12 million in Indian startup Acko (Business Today India, May ‘18)