Ali Hasan
Introduction – Remember those days when you got confused as to which insurance policy is best for you or for your family? Well I don’t know about you but I can clearly remember those days when there were ads on TV explaining complex terms (like endowment or term) about insurance and we still used to get confused. We weren’t at fault as understanding insurance and different policies are quite a task in itself.
But to clear our confusion, we now have PolicyBazaar which enables a person to effectively choose from million of options and to get the policy which is most suited to his/her needs. But how much is the platform effective? And how well does it help you in order to avail an insurance policy? As we cover the story of PolicyBazaar, we will explore their journey and will try to answer all these questions.
We will also look into how they get you insured. So, stay tuned and real along.
Early Days – PolicyBazaar was started in June 2008 in Gurugram, India. It was co-founded by Yashish Dahiya, Alok Bansal & Avaneesh Nirjar. It provides a digital platform – website and app – where users compare financial services from major insurance companies and have the option to choose the best one according to their unique needs and requirements. The company is India’s largest insurance aggregator.
Initially it started out as an insurance comparison website where people had the option to buy various insurances such as:-
- Life Insurance
- Health Insurance
- Vehicle Insurance
- As well as other types of Insurance
But later expanded and added Investments Plans into their offerings where users had the option to invest into schemes which were financial instruments designed for saving as well as investing your hard earned money. Users also have the option to renew their insurance policy.
Marketing Strategy – PolicyBazaar had a very simple marketing approach where they used the stardom of a celebrity to make their ads. They were first endorsed by comedian Kapil Sharma and later by actor Akshay Kumar.
The ads focused on educating the users to compare various policies and get into the details so that they are able to save as much money as possible while getting the maximum benefits. They have a tagline named “Insurance compare kiya?”
In one ad, we can see that Akshay Kumar was dressed as Yamraj who is there to take away the soul of a person who died and forgot to buy term insurance for his family. In this ad, they focused on the importance of buying term insurance for the safety & security of your family as well as for having peace of mind.
User Base & Valuation – PolicyBazaar has more than 5 million downloads on Google play store. PolicyBazaar gets 100 million visitors each year and it sells over 15000 policies per month. That’s quite a good number for a growing company. According to the company, since their inception in 2008, they have not only ensured 100% year-on-year growth but have also been profitable on their operations side throughout their journey.
They host over 100 million visitors a year on their platform seeking information on insurance. That is almost 4 times the population of Australia! They get about 2,73,973 visitors in a day and about 11,416 visitors every hour. Every month hundreds of thousands of insurance policies are sold through them. This means nearly 555 people are being protected through them every hour. In 2014, their target was to reach 10 million customers by 2020. They accomplished that feat in FY 2019, with a year to spare!
PolicyBazaar will help you with anything that’s related to Insurance
As of writing this content, PolicyBazaar has achieved a valuation of $2.4 billion. That’s quite amazing. This happened as they just received fresh funding.
Funding – PolicyBazaar has so far raised a total of $626.6 million in funding over 10 rounds. Their latest round of funding was held on July 7, 2020. They have a total of 16 investors, out of whom 6 are lead investors. Their major investors are as follows:-
- SoftBank Vision Fund
- Tencent Holdings
- Wellington Management
- PremjiInvest
- Tiger Global Management
- Inventus Capital
- Temasek Holdings
- Info Edge
Revenues & Losses – PolicyBazaar reported a healthy 66% increase in revenue from INR 310.3 Cr in FY2019 to INR 515 Cr in FY2020. On a consolidated basis, the company’s expenses touched INR 1150 Cr, with advertising costs making up for 38% of it. PolicyBazaar’s CEO Yashish Dahiya claimed in July 2020 that the company aims to cut down on its marketing cost and hit profitability in FY2021.
Their losses were cut down by almost Rs 40 crores as they had Rs 344.2 crores in FY 2019 which reduced to Rs 304 crores in FY 2020.
Controversies – In August 29, 2019, PolicyBazaar was slapped with a fine Rs 1.11 crores. Finding it guilty on multiple counts, Insurance Regulatory and Development Authority of India (IRDAI) has slapped a penalty of Rs 1.11 crores on insurance web aggregator PolicyBazaar and has also issued a stern warning against violation of rules in future.
The regulator has directed the firm to deposit the penalty within 15 days from the receipt of the order. “lf the web aggregator feels aggrieved by the above decision in this order, an appeal may be preferred to the Securities Appellate Tribunal as per Section 110 of the insurance Act, 1938,” the IRDAI order stated.
The IRDAI in its order said that PolicyBazaar had failed in complying with the Regulations on Insurance Web Aggregator Regulations issued in 2013 and 2017 which had been created to protect the interest of the policyholders and regulate the business of web aggregation. “This is evident from the penalties and the warning issued for violations of Insurance Web Aggregator Regulations,” it said.
They were slapped with another fine of Rs 10 lakh for concealing facts to obtain an interim order. The fine was imposed by Delhi High Court in May 2019.
Investments – PolicyBazaar has invested in DocPrime. They made an investment in September 2018 and the funding round was valued at $50 million.
Present Time & Future Goals – Just recently they received an investment from a firm named Bay Capital. This will help them before they go public in 2021. They might hit a valuation of about $3.5 billion before its planned IPO. PolicyBazaar is going to have an IPO in the near future. They are planning to have an IPO in the next 12-15 months.
“Bay Capital has completed a secondary transaction, ahead of the insurance aggregator’s plans to launch an IPO in the next 12-15 months,” Bay Capital said on Wednesday. However, how much capital has been infused by Bay Capital could not be ascertained.
Conclusions – To conclude things up, all we can say that PolicyBazaar looks like a promising startup that is now a unicorn. Not only that, it’s now focusing on profitability and with new fresh funding they can realistically execute a vision of having an IPO in 2021 without any hiccups.
Hope all’s well for them and if you still haven’t bought insurance, then please go to their website and compare all the policies to get the best one for yourself at the lowest price.
