Naked Insurance, a South African insurtech firm that assists customers in insuring their vehicles, homes, and belongings, has acquired $17 million in Series B funding backed by the International Finance Corporation (IFC).
The German Development Finance Institution (DEG) and previous investors Yellowwoods and Hollard participated in the round. The announcement comes after the South African insurtech announced a $11 million Series A financing backed by Naspers in August 2021.
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According to a release, the money allows Naked to develop its AI and use it to increase Africa’s insurance sector, which is valued more than $68 billion in yearly gross written premiums. With an annual gross written premiums market of more than $47 billion, South Africa accounts for 70% of this industry. However, only a small percentage of personal insurance is offered without the involvement of a human.
A Look At What The Startup Does
Naked is a digital insurance platform that covers automobiles, content, residences, and freestanding products. It was founded in 2018 by Alex Thomson, Sumarie Greybe, and Ernest North. According to a release, the company uses artificial intelligence to develop innovative client procedures and experiences that do not require the interaction of a contact centre worker. It enables businesses to realise large cost savings from automation and transfer those savings on to customers in the form of lower premiums.
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Naked claims that its technology and business model set it apart from other African insurtechs such as Kenya-based Turaco, which received $10 million in September. “Unlike the traditional model, where insurers’ earnings are determined by the amount of claims paid, Naked charges a fixed proportion of consumers’ premiums. When claims are lower than predicted, the excess is donated to communities and good causes chosen by customers,” the statement reads.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard