Devendra Rane, co-founder and Chief Technology Officer, Coverfox.com, graduated from IIT Mumbai in 2005 with a Bachelors and Masters degree in Aerospace Engineering. He started his entrepreneurial career as the co-founder of ‘Innovations Unified’ which was the winner of ‘Eureka’, Asia’s biggest business plan competition. The business was centred on a proprietary nanotechnology which he developed as a part of his thesis.
Prior to Coverfox.com, he has co-founded two companies, one specialising in user experience design and the other providing technology services to financial and insurance domain.
He has worked with many tech startups at various stages. He is experienced in conceptualising appropriate Minimum Viable Product (MVP) for startups as well as enterprises. He has managed globally distributed projects and teams, and has a pragmatic understanding of developing products in such environments. With his valuable experience in large scale consumer and enterprise platforms, he understands scalability of an evolving product as it goes from being an MVP to a successful product.
Coverfox.com is India’s fastest growing online insurance platform where one can compare, buy and manage one insurance policies. The portal helps bring transparency, simplicity and ease to the process of buying and managing insurance in India. Using its proprietary technology and algorithm based platform, users can compare and choose from a range of plans across top insurance companies, understand key features and buy policies instantly and safely. Once bought, we handhold and help the users through the tedious claims process. Coverfox.com currently offers health, car, bike, travel and term life insurance products.
How did you come about setting your focus on this particular category? Please tell us a little more about the company’s beginnings as well.
In 2011, Varun Dua and I started off together with Glitterbug Technologies, which was building middleware technologies for leading insurers. Around that time, insurance companies were working with legacy technologies as they tried to cater to new age online customers. While creating middleware and web experiences for insurers to facilitate online transactions, we observed a conspicuous problem. The experience of online insurance was nowhere close to a user’s interaction with interfaces like Facebook, Gmail. While the e-commerce boom was yet to reach the insurance sector, we realised that if presented well, customers would find it easier to buy insurance online too.
We decided to take this challenge head on and founded Coverfox Insurance Broking.
What transformations have you undergone as a company since starting up?
We have grown as an organisation since our inception. From doing 500 policies during Jan’15, we now do 30,000+ policies a month. We receive over a million users on our website every month and have over 35 insurance companies on board with us across motor, health, travel and term life insurance verticals. Throughout our growth journey, we have consistently focused on making insurance a less feared term. The interface has been created in such a manner that the process of buying and managing any kind of insurance is transparent, seamless and hassle-free. We believe in creating an insurance space, where the users have the authority to make insurance decisions on their own.
With this philosophy in mind, our team has created the UX / UI in such a manner that a user can buy a car insurance policy on Coverfox.com in 7 minutes and a two-wheeler insurance in 4 minutes. In fact, 100% of Coverfox.com bike insurance customers insure their bikes online; 80% of these do it under 4 minutes. We have a claims servicing team that relays information between the insurers, network garages / hospitals and customers to ensure speedy recovery of insurance claims. We are setting up similar services across the insurance verticals.
Thoughts on the present Indian fintech landscape? How does it compare to the rest of the fintech majors in the world like Hong Kong, Singapore, United Kingdom, Sweden, etc. according to you?
As compared to the developed nations, Insurance in India has far little market penetration. There’s little awareness about the need for buying insurance. At the same time, important information about a product is usually hidden in jargon-loaded policy wordings, because of which a lot of customers end up buying insurance with little understanding of the intricacies of the product. Insurance has always been looked at as a call-centre based product; the intervention of salespersons is almost a pre-requisite.
In all this, online insurance forms a minuscule portion of the overall industry. Furthermore, while the risk portfolio and landscape has changed drastically, the Indian insurance industry is still serving products that were being served 20 years ago. We believe the next set of disruption in insurtech will come in terms of the insurance products. China’s insurtech is an excellent example of how insurance product innovation can change the landscape and create a breakthrough for the whole industry.
Which are the sectors in Indian fintech where you think there are untapped opportunities? How does it fit in with your product and growth plans for the immediate future?
Insurance is an extremely large segment and the insurtech innovation has only touched the tip of the iceberg while innovating on the retail sector. I don’t think we are anywhere close to claiming that the problem of distribution has been solved. Nonetheless, digitisation has catalysed the process of insurance penetration in India.
With digitisation, we are already looking at trends where more customers are willing to pay insurance premiums online instead of paying cash to offline agents. People are also getting more receptive to ideas like cashless hospitals and cashless garages, which had always been part of insurance claims services, but weren’t taken that seriously.
Another big opportunity that digitisation is bringing to our disposal is that a lot more auxiliary services are coming online. This opens up avenues for insurance to be bundled up with such services.
Apart from this, the entire insurance chain is dependent on the interaction and functioning of various parties: insurance company, brokers, third-party administrators, and the consumer. Most important basis of these interactions is the matter of trust. To bring in self-regulation and good governance throughout the chain, technologies like Blockchain are coming come into picture. Instant validation and settlement of insurance claims would be possible with the sharing of data in real time. B2B insurance is one part of the industry that has massive scope for digitisation.
At an organisation level, we are closely working with insurance companies to improve their product offering. Along with profiling risk, we have created a model that is our first attempt at an “Insurance Intelligence Engine”. We have actively collected data for the last 3 years of our existence and the model is evolving. As of now, while we are trying to fine tune the model, we are also doing probabilistic forecasting to get a sense of its accuracy. It is a slow process, but we believe we will be able to democratise risk profiling for several players while at the same time maintaining user privacy using emerging technologies like Blockchain.
Please tell us a little about your funding journey – the requirements & objectives in mind when you decided to raise a round/s; the fit you found or were looking for with your investors; what would you be looking for in the future as the business grows?
Insurance is a regulated sector and our plan was to create an e-commerce portal for insurance. Given this, we had challenges that not just e-commerce players faced, but were compounded with regulatory clearances from IRDA. The regulation requires a minimum net worth for the applicants, so we had to raise investment with zero business, since we couldn’t have sold without a license. Finding angel investors who understood insurance and regulatory norms was a big challenge.
Our experience with running in an insurance services setup helped us get the platform and the product right. Investors and the regulatory body (IRDA) liked our product-focused approach and the business plan, which helped us mount all these challenges.
What advice would you give to other fintech entrepreneurs?
Young entrepreneurs must understand that a startup will eat up the bright years of your life if the idea is not validated soon enough. My advice: don’t raise funds till you accept the fact that you will have to run the business for at least 8-10 years, and till you have a plan (and timelines) to make the business profitable. Look through the glamour around raising funds and becoming a CXO, and understand that it’s not funding that guarantees success but your belief and passion in your business idea.
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