Onsurity, an insurtech startup based in India, has secured $24 million in a Series B funding round led by the International Finance Corporation (IFC), a member of the World Bank Group. The company specializes in offering monthly subscription-based insurance solutions to micro, small, and medium enterprises (MSMEs), startups, and growing businesses.
Key Takeaway
Onsurity, an Indian insurtech startup, has raised $24 million in a funding round led by the World Bank’s International Finance Corporation. The company focuses on providing insurance solutions to micro, small, and medium enterprises (MSMEs) in India, a sector that has been underserved by traditional insurance players. With its subscription-based offerings and integrated healthcare benefits, Onsurity aims to address the specific needs of MSMEs and foster economic risk management for this segment.
Targeting the Indian MSME Market
India has a large number of MSMEs, with over 63 million enterprises employing nearly 400 million workers and supporting 675 million families. However, traditional insurance players in the country primarily focus on motor, retail health, and large corporate insurance programs, leaving a gap in the market for MSMEs. This is partly due to the low penetration of insurance in India, which was recorded at just 4.2% in 2021.
Recognizing this opportunity, Onsurity has developed a suite of insurance offerings tailored specifically for MSMEs and emerging businesses. In addition to insurance coverage, the startup integrates healthcare and wellness benefits into its packages. This allows enterprises of all sizes to provide their employees with access to health checkups, fitness memberships, doctor consultations, discounted medicines, and other services.
In a recent move to expand its product line, Onsurity introduced cyber risk insurance to help businesses protect their online presence by providing dedicated coverage against privacy and security breaches. The company also offers other business products, such as D&O liability insurance and commercial general insurance under the name Onsurity Plus.
Creating a New Category
Yogesh Agarwal, founder and CEO of Onsurity, emphasized that the company is not trying to compete with established insurance players or large distributors in India. Instead, the focus is on creating a category of its own that specifically caters to the unique needs of MSMEs and growing businesses.
Onsurity works with multiple insurance partners and companies in the healthcare and wellness services space. The startup has also formed partnerships with leading reinsurers for deep integration and embedding insurance within its overall offerings.
To ensure a seamless claims experience for its customers, Onsurity has started collaborating directly with hospitals. Over 100 hospitals have already joined the platform, streamlining the claims process and enhancing the integration of healthcare services.
Expanding Reach and Future Plans
Onsurity currently serves over 5,000 enterprise customers, reaching over a million individuals across 26 Indian states and three union territories. Its member base comprises business executives, startup employees, gig workers, and their dependents. Approximately 80% of Onsurity’s portfolio consists of SMEs, with over half of its members being blue-collar workers and nearly 40% coming from tier-II and tier-III cities.
The latest funding round will enable Onsurity to further expand its customer base, with a target of reaching over 50,000 companies and providing coverage to more than 5 million lives by 2026. The startup plans to invest in technology to enhance its competitive position, improve settlement processes, and develop an AI engine to tailor insurance products to specific SME customers based on their risk profiles.
According to Wendy Werner, IFC country head for India, the availability of insurance coverage is crucial for economic risk management and social security. With its technology platform, Onsurity aims to improve accessibility to employer-sponsored health insurance services, alleviating the financial burden of healthcare expenses for employees of MSMEs.
With its track record of growth and commitment to expanding its presence, Onsurity is poised to make a significant impact on the Indian insurance market, providing valuable coverage and services to MSMEs and supporting the country’s economic development.
