78% of all property and liability policies from BimaKavach were purchased by SMEs who were new to insurance. They had no prior insurance purchase history. Why is this astonishing?
Indian enterprises faced 5B+ cyber attacks in 2023. India Inc. incurred $9B in legal expenses in 2023. Earthquakes, floods and fires cause $8B in losses every year.
Damage and revenue loss of this scale can put MSMEs out of business, even with one occurrence. Yet, 93% of such risk exposures are uninsured in India. Non-life insurance penetration is at 1%, way lower than the global average of 3.7%.
Why do small businesses not adopt adequate risk transfer mechanisms?
❌ General business insurance is often inaccessible
👹 Lack of standardised risk assessment techniques leads to underwriting challenges on the part of insurers ..
🤕 .. making premiums expensive, where available
Tejas Jain, founder of BimaKavach, hails from a family with three generations engaged in the distribution of insurance products. He had seen this problem widely prevalent in Tier 2/3 India, and decided to pounce on this opportunity.
To address the asymmetric geographical location of SME clients, BK pioneered digital distribution, bypassing the need for physical presence. 90% of all its new clients today are digitally acquired.
Asset-heavy businesses, often small in size and under the radar of traditional brokers, account for 77% of BimaKavach’s client base. >50% of BK’s client base is directly involved in manufacturing, engineering and construction activities. Sole proprietorships constitute more than 55% of the businesses insured.
Premiums are no longer unaffordable -
🔥 Property and inventory, worth $200K, can be insured from damage by fire, for as low as $60 annually
🏢 Companies can protect all their Directors and officers from personal financial losses (arising from legal protection, lawsuit costs and settlements) of $100K at $200/ year
👨💻 $1M in damages associated with cyber attacks can be insured for $10K in premium
🚀 Today, BimaKavach issues 750+ policies to more than 250 new clients monthly, collecting $300K in gross written premium (GWP). So far, BK has insured 2,250+ clients with a 99.7% retention rate.
Through BK, Sachin, who runs a garage and repair shop in Wadki, outskirts of Pune, recovered his inventory losses after a devastating fire destroyed his shop and goods worth $10K.
Shrikant, a first-generation entrepreneur engaged in solar power EPC company, recouped a few thousand dollars from insurance when heavy rains in Raipur destroyed his solar panels.
Tejas and his amazing team are helping not only the underinsured, but also the underbanked segment of the society safeguard their means of livelihood from all untoward incidents.
As their first institutional backers, we wish them all the success in this journey! 🙌
Anjali | Manish | Ashish
