Acko Case Study-The First Digital Insurer Start-up of India!

The global pandemic has redefined the definition of uncertainties in life and the preparedness required on the part of the individuals to have adequate means to tackle the situation whenever it comes.With rising insecurities, financial fraud, and skyrocketing inflation rates, insurance has become an unavoidablefact of our lives.

Whether it is life insurance or health, car insurance, or bike insurance, it has become immensely necessary to ensure proper protection in every aspect of our lives. However, in the age of the internet, there are a plethora of insurance providers available to choose insurance products from, however, not every insurance provider is honest & transparent enough to avoid charging hidden costs and commissions from gullible insurers who fall into their traps!

Yes, there are insurance providers who despite being fully digital in their business functions serve their customers happy with zero percent commission charges, one of them being Acko, which is India’s first digital insurance provider start-up launched in the year 2016 and revolutionizing the insurance industry with the swift rise in its demand!

All About Acko– Insurance Made Easy!

Founded by the two co-founders Vinod Dua & Ruchi Deepak in the year 2016, Acko is the pioneer of the digital insurance providers that serve the Indians with premium insurance with zero commission charges and 50 % lesser paperwork than generally required by the other insurance providers. After receiving its business license from the Insurance Regulatory and Development Authority of India (IRDA) in September 2017.

Starting with a close-knit team of six people, Acko General Insurance Ltd is among the fastest-growing insurance companies with a team of 530+ employees.Within three years of its launch, this digital insurer start-up has augmented the insurance with technology and came up with a flashy renovation.The business has adopted an online model of insurance, with the help of which it offers its customers premium insurances facilities and bite-sized insurance products with zero commissions

The slogan & tagline of Acko Insurance state- “Insurance made easy” and “Full Paisa Wasool” respectively, which have been purposely set up to indicate simple processes and spread awareness about the transparency of “the total value for the insurance money!”

Acko’s digital platform runs through an online-led model which reduces all the official paperwork, offer innovative but genuine products, and supplies products to more than 50 million exclusive customers. Its humble offerings include-

• Car & Taxi insurance
• Bike Insurance and
• Health Insurance
• Mobile Insurance &
• Domestic trips insurance.

In a funding round led by investors like General Atlantic, Multiples Private Equity, CPPIB, and Light speed Growth in Series D round, it bagged an amount close to $255 million led it to achieve its unicorn status after making it reach a valuation of $1.1 bn and the 34th start-up unicorn of the year 2021.

Acko-Story of Inception

Acko was born to revolutionize the insurance industry by digitally empowering customers to look, research and choose and take insurance products at their convenience with the least paperwork. Ruchi Deepak, co-founder & director quotes “Before Acko came into being, buying insurance was a tiresome, boring and non-transparent process, let apart other processes like servicing or claims process even for simple products. Furthermore, the pricing & insurance plans were complex. Therefore, I & my Co-founder Vinod Dua saw huge opportunities in a digital business that could unlock in terms of enterprise value & customer experience and decided to pursue it.

Acko– Founder & Team

Varun Dua serving as the Co-founder & CEO of Acko completed his studies at the University of Mumbai & MICA Ahmedabad respectively. After which he joined as a trainee at Leo Burnett Advertising for a period lesser than one year, and went on to work as a Marketing Manager at Tata AIG Life Insurance and Franklin Templeton Investments for a brief period. After which, he founded a series of companies namely Enser Communications and Glitterbug Technologies, and Coverfox Insurance Broking Pvt. Ltd., and worked as the Founder and CEO, before finally launching Acko General  Insurance Ltd. and been working in the position since 2016.

Ruchi Deepak, Director& Co-founder of Acko General Ltd is a woman who has been all about breaking stereotypes. Originally from Jamshedpur, she completed her bachelors from Lady Shri Ram College (LSR), followed by a course from the Faculty of Law. After completion of her education, she served in many senior positions in India and London, in companies like Coverfox, Matrix Partners, and Franklin Templeton Investments, where she learned the tenets of legal and compliance work while also gaining experience as an advisor to numerous start-ups.

Having a belief in enterprising and always with no aversion to taking risks, she decided to take on her entrepreneurial journey of entrepreneurship while also embarking on the journey of motherhood. She gave birth to twins around the same time while setting up the start-up business and filling for a license was going on in around October 2016. Acko has two co-founders namely, Mr. Vinod Dua, who serves as the Chief Executive Officer (CEO) & Co-founder, and Ruchi Deepak is the Co-Founder & Director of the company.

Acko– Business &Revenue Model

Acko is primarily engaged in D2C (direct-to-consumer approach) and offers insurance products to its customers through its fully digital platform, which allows for favorable risk selection and underwriting. Along with the products such as health & vehicle insurances, it also offers innovative bite-sized products such as rider insurance, mobile and appliance protection, ticket cancellation, etc. with the auto-insurance being an instant hit.

Acko generates its revenues through the sale of its insurance policies which are innovative and customer-driven in nature. Their greatest revenue driver is the insurance offered to electronic products like smartphones, Laptops, and other home electronics products sold through online retail applications like Amazon, which is also an investor & partner in the Acko Business.

Acko has gained phenomenal customer support& trust its customers due to its customer-centric policies. It claims to have sold insurance products to more than 62 million unique customers within a short period of 24 months of operation and has received 5-star ratings and over 4.5 crore, happy users. Now, Acko has also started slowly expanding and establishing its presence with new products such as corporate health insurance that was launched in 2021.

Acko– Funding& Notable Investors

To date, Acko has raised total funding an amount of around $458 million over six rounds of funding. A total of 21 investors have invested in the business including names like Narayan Murthy (Founder of Infosys) and Binny Bansal (Flipkart Founder) out of which 8 of them are lead investors, with Intact Ventures being the most recent one.

On Oct 27, 2021, the Digi-tech insurer received total funding worth $255 mn in a funding round held by investors such as General Atlantic, Multiples Alternate Asset Management Private Limited, and others that helped its valuation to reach its unicorn status.

Acko– Growth & Competitors

Acko is one of the fastest-growing fully digital insurance start-up businesses in India. In 2019, this start-up witnessed a 6 times growth in the business as it underwrote a premium worth of Rs 41.56 crore as compared to FY 18 in which it underwrote a premium of Rs 6.53 crore.

In the years 2020 & 2021, despite the movement restrictions of the customers visiting the showroom during lockdowns, the purchase of vehicle insurance products through the digital platform was on an upward trend resulting in a whopping 120% growth in the sales of insurance policies for automobiles in the first quarter of FY22 when compared with the same period last year.

Likewise, in the first quarter of FY22, Acko has reported a Gross Written Premium of ₹81 crores, with a total growth of 1.16 times for their auto business as compared to the same quarter of FY 21. Interestingly, Acko saw an increase in customer growth from non-metro cities around 3.5 times during the same period which was more than metro cities that were limited to just 2.5 times.

On Oct 27, 2021, the start-up bagged a total of around $255 mn from a group of investors that helped it to reach its unicorn valuation resulting in a two-fold jump in the valuation of the company, which was around $500 million in the previous funding round of September 2020.

Presently, Acko boasts of around 4 million+ users on its digital platform each month and the trend is on an upward mode more than ever. The Acko platform site also reported a 161% jump in the website traffic in the second quarter of FY22 when compared to the same time around FY21.

Moreover, Acko also claims to have more than 70mn customers all over the country and is still counting. Undoubtedly, it is one of the largest players in embedded insurance products like mobiles & electronic gadgets across popular digital platforms like Amazon, MakeMyTrip, Ola, Urban Company, Bajaj Finance, and others.

Competitors in Insurance Industry

Considering the fact that, Acko General Insurance, was the pioneer of digital insurance providers platforms in India, however various other similar businesses have come into being, and the top competitors in the field include-

• Easy policy-It is the top competitor of Acko insurance in the health and life insurance industry in India and was founded in the year 2011 with its headquarters in Noida, Uttar Pradesh. However, it is known to have reported lesser revenues than Acko.
• Policy Bazaar–Policy Bazaar is yet another tough competitor that offers insurance products and services to its customers that was founded in the year 2008, and is known to generate higher revenues than Acko.
• Go Digit–Founded in the same year as Acko insurance, this was also founded in 2016 with its headquarters in Bengaluru, Karnataka, India and works in the Health and Life Insurance sector and also generates less revenue than Acko.

i. Key principles-The unique marketing combination of Acko relies on 4Ps namely, Product, Price, Place, and Promotion. Apart from the other general insurance products, motor insurance, in-trip domestic insurance, and smartphone insurance are some of the retail products of Acko General Insurance.

ii. Varied Insurance Products-Acko General Insurance has the following Products:

• Car Insurance
• Bike Insurance
• Health Insurance
• Mobile Repair
• TV and Appliances Repair

iii.  Key Partners-Company has associations with businesses under several business categories namely-

• To ensure travel & trip protection plans, it has entered tie-ups with Ola, Redbus, MakemyTrip, Rapido Passenger, Goibibo, Dunzo Passenger, Zoom Car, and Abhibus, Happay, and DriveU.
• To offer health plans, Acko has partnered with Practo+ and Niyo.
• For the Loan Payment Protection Plan, the company has entered tie-ups with AU Bank, HDB, Lendingkart, ZestMoney, MoneyTap, and Kreditbee.
• To offer COVID-19 Protection it has entered tie-ups with Amazon, Rapido, Captain, Zomato, Dunzo Rider, etc
• Acko is also the official insurance partner of the Indian IPL team,Delhi Capitals.

iv. Key Marketing Strategies-Acko insurance business has multiple channels for selling its policies through its branches with its marketing executives to the customers and selling policies through its online channel. It uses aggressive marketing techniques through online as well as offline means to create a unique business identity among its target audience. It uses digital marketing techniques for online advertisements through the use of Google Ad Network and other Ad Networks. Some other marketing techniques employed are Facebook Marketing, WhatsApp Marketing, Tiktok Marketing, and other social media networks for its promotion. Similarly, for offline promotions,Acko advertises its products on Television, in Print Media, and Magazines, and on board hoardings to promote products throughout the country.

v. Unique pricing & plans-The insurance premiums charged for insurance products are minimal & reasonable, and are dependent on the insurance cover & the age of the customer. The terms of general insurance competitive pricing and benefits as per the IRDA Regulations.

vi.Quick & Simple Claim Method- the process of taking up an insurance product to claim process is 100% online, with minimalpaperwork, and convenient with just one click. Any claim could be filed either through a call or online for stress-free, cashless, and speedy claim settlements.

Acko –Future Plans

Undoubtedly, Acko insurance established itself as a key player in the Indian insurance industry particularly due to its innovative products and the use of deep technologies.Acko CEO & Co-founder, Varun Dua has stated- “Acko has worked towards redefining the protection category for its customers and still intends to continue bringing innovation in this space. It will continue to support its customers in the protection of their valued assets like the health & safety of their dear ones through its differentiated product and value-added service depending upon their unique risks and needs in a reliable but smooth manner.

Likewise, Shantanu Rastogi, Managing Director, General Atlantic, one of the key investors has stated- “Acko has developed a unique, differentiated & scalable business model out of its remarkable customer focus, value-based product pricing, highly-rated services, and deep technology capabilities.”The co-founders are currently planning to scale the value of the Acko insurance products while looking into the health insurance schemes. With the increasing needs of the business, Acko is also gearing towards hiring more employees while scaling up largely across the verticals of technology, auto insurance, and micro-insurance products across travel, gadgets, and appliances.

In the coming years, Acko intends to invest more funds in the expansion of its healthcare vertical while expanding its team, especially in technology, product, and data science. To offer embedded insurance products, it has entered partnerships not only with companies like Amazon, MakeMyTrip, Ola, Urban Company, and Bajaj Finance, among others but also with innumerable gig workers a million gig workers with start-ups such as Zomato and Swiggy. Since Acko has met with tremendous success in its auto front of the insurance business, it is also planning to invest more funds and invest over $150 million in the health business shortly to further expand its reach towards its audience.