In a bustling café in Mumbai, Vaibhav Kathju found himself engrossed in yet another conversation about insurance. But this wasn't a sales pitch; it was yet another friend sharing their experience about buying the wrong insurance policy. As he sipped his coffee and listened to his friend's confusion about policy terms, Vaibhav realized that even in 2024, insurance remained an enigma for most Indians.
From Corporate Corridors to Entrepreneurial Dreams
Vaibhav's journey to Insurance Padosi wasn't a straight path. With over two decades of experience in the insurance industry, including stints at giants like HDFC Insurance, Religare, and DBS, he had seen the inner workings of the system. His last venture, Mahila Money, had given him a taste of entrepreneurship, but it was his post-exit "Coffee and Me" sessions that opened his eyes to the gap in the market. After his exit, he volunteered his time and insight for friends and family who wanted advice and guidance about their insurance investment strategy. These casual conversations unveiled three critical insights:
- Even affluent, educated individuals lacked a clear understanding of insurance.
- Most people had a common set of questions and concerns about insurance across age groups like the nuances of health coverage and the do’s and don’ts of term insurance.
- Insurance agents themselves often lacked comprehensive product knowledge, leading to misaligned recommendations focussed on sales, not service.
So Vaibhav set out to create an insurance advisory firm that would help customers ask the right questions and find the right policy. For this, he reached out to Abhay Singh, a colleague he had worked with since 2016, known for his operational expertise. The team was completed when Vaibhav connected with Gaurav Gupta, a school friend with a strong tech background who had been part of Flipkart's and Delhivery's zero-to-one journeys.
With the team in place, they began building an AI tool that could provide personalized insurance recommendations in under 60 seconds for agents to use. As they developed their concept, they caught the attention of industry veterans, including Hemant Kaul, ex-CEO of Bajaj Allianz, who became one of their first investors. It was during this initial phase of development and fundraising that Vaibhav connected with Antler.
The Evolution of Insurance Padosi at Antler
Initially approaching Antler for fundraising, Vaibhav and his co-founders found themselves immersed in the Residency program after consulting with the Antler team.
"The Antler program provided us with a space to thoroughly evaluate our ideas and challenge our assumptions," Vaibhav reflects.
Throughout the Antler Residency program, the team took part in over 100 customer interviews revealing a distinct set of needs across three distinct age groups. Those in their 20s craved AI-driven solutions with minimal human interaction. The 30-40 age bracket sought a Wiki-like platform for independent research, while those over 40 were more amenable to traditional agent interactions.
As they delved deeper, Insurance Padosi's thesis also underwent a significant shift. "Our original thesis was B2B," Vaibhav recounts. "From there, we evolved from a B2B2C distribution model to a B2C model. So it was a 180-degree shift that happened. And large credit goes to Antler."
This pivot was accompanied by a simplification of their initial Insurance Health Report product, making it more user-friendly and action-oriented. They also shifted gears from B2B2C partnerships with established players like SBI and Kotak to exploring direct B2C collaborations.
Building a new-age Insurance solution
With over $20 billion in gross premiums collected for Life and Health Insurance in FY-23 and 50 million new policies sold annually, the Indian insurance landscape is ripe for disruption. Despite its size, India's insurance penetration remains low at less than 4% of GDP, significantly behind developed countries. Beyond this, our investment in Insurance Padosi is rooted in:
- Shifting Consumer Behavior: Insurance is transitioning from a mere tax-saving instrument to a necessity for financial protection. This shift mirrors the evolution seen in mutual funds, which moved from tax-saving ELSS schemes to systematic investment plans (SIPs).
- The Trust Deficit: The current insurance landscape is marred by a misalignment of incentives between agents and customers. Insurance Padosi aims to bridge this trust gap by offering unbiased, data-driven advice.
- The Scalability Factor: By leveraging AI and machine learning, they aim to provide personalized advice at a fraction of the cost of traditional agent-driven models.
- The Untapped Market: With 50 million new policies sold annually and a growing middle class becoming more financially aware, the growth potential is immense.
Nitin, Partner at Antler in India, adds: "We see Insurance Padosi as the vanguard of a shift in insurance buying behaviour. Just as we've seen in the investment industry, insurance is moving towards sophisticated, personalized advisory. The Insurance Padosi team is uniquely positioned to lead this change, leveraging their deep industry knowledge and tech-forward approach."
The Road Ahead for Insurance Padosi
Insurance Padosi's vision extends far beyond being just another insurance marketplace. In the immediate future, the team is focused on launching bite-sized insurance products, starting with offerings as affordable as ₹10 to ₹200.
Looking ahead, Insurance Padosi aims to disrupt the traditional insurance sales model by prioritizing customer education and personalized recommendations, a stark contrast to the one-size-fits-all approach prevalent in the industry.
In a market where insurance has long been sold, not bought, Insurance Padosi is betting on a future where informed customers make empowered decisions. It's a bold vision, but one that could transform the financial security of millions of Indians.
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