Its competitors include the new age Acko which like Digit plans to leverage the technology platform to differentiate. While Acko is backed by Narayana Murthy’s Catamaran Ventures, Digit is backed by Toronto-based Fairfax Financial that is known for its insurance ventures globally, including Lombard. Since the time it acquired control of Canadian trucking insurance specialist Markel Financial in 1985, Fairfax stock has been compounded by 19 per cent for over 30 years. “From understanding the best practices of various companies globally, and leveraging the expertise in building some technology platforms, we would work closely with Fairfax’s portfolio companies wherever there is synergy,” says Jasleen Kohli, director and chief distribution officer, Digit Insurance.
Digit is entering the market at a time when customer complaints and dissatisfaction with insurance companies are on the rise. It is this dissatisfaction that the company wants to cash in, with bringing transparency through technology. It is building a technology-driven platforms that can offer customised products at reduced cost, and provide better customer service.
“Fairfax is a very large general insurance company and will support and guide the company through knowledge sharing, reinsurance support, etc. The operations will be run by management team,” says Kohli.
The company, has 45 per cent stake held by Fairfax Holdings and rest by Kamesh Goyal-led Indian investors. Goyal a former executive of German insurer Allianz is heading the operations of Digit.
Though general insurance market grew 32 per cent year-on-year in 2016-17, the penetration level in India is still under 1 per cent. “The new digital ecosystem provides a fertile ground for new launches. In any case, every financial service is underserved, so is general insurance,” says V Vaidyanathan, chairman at Mumbai-based non-banking finance company Capital First. Vaidyanathan was earlier, along with Watsa, on ICICI Bank board.
“I always found that he thinks long, acts long, looks through short-term bumps, and thinks ahead. Fairfax is an extraordinary success in general insurance internationally, such experience and backing can be very handy for the start-up,” he says.
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