MyCover.ai, a Nigerian insurtech startup, has recently secured $1.25 million in pre-seed funding. The investment round was led by Ventures Platform, a Pan-African venture capital fund, with participation from Founders Factory Africa and follow-on investor Techstars. 

The funds raised will be utilized to enhance the company’s internal operations and technical capabilities. MyCover.ai plans to invest significantly in its proprietary technology and strategically expand its operations into other African markets.

Why The Investors Invested

The decision to invest in MyCover.ai is based on compelling factors that demonstrate the startup’s potential for success.

1. Untapped Market Potential: Africa’s insurance market is projected to grow at a CAGR of 7% between 2022 and 2028, with an estimated value of $120 billion. However, the current insurance penetration on the continent is less than 3%, indicating a vast untapped market. MyCover.ai’s innovative solutions have the potential to address this gap and significantly increase insurance adoption, thereby capturing a significant share of the expanding market.
   
2. Addressing Market Challenges: MyCover.ai recognizes the existing pain points in Africa’s insurance industry, including limited access, inadequate coverage, unaffordable products, and poor customer experiences. By offering an open insurance API and streamlining underwriting, product development, distribution, and claims processes, MyCover.ai aims to overcome these challenges and provide a comprehensive solution. The investors view this approach as crucial to driving insurance penetration and fulfilling the market’s unmet needs.
   
3. Disruptive Technology: MyCover.ai’s proprietary technology and infrastructure play differentiate it from other API-driven insurtech startups. The company’s AI-powered claims management solution, combined with its personalized insurance offerings, enhances the customer experience and aligns with market preferences. The investors recognize the value of this technological advantage and believe it positions MyCover.ai for sustainable growth and competitive advantage in the insurance sector.
   
4. Collaborative Approach: Unlike insurtech solutions that focus on specific areas of insurance penetration, MyCover.ai takes a collaborative approach. The startup offers a suite of services that cover the entire spectrum of challenges faced by the underserved market. By facilitating partnerships with insurance distributors and empowering businesses across various sectors to embed insurance products, MyCover.ai creates a network effect that benefits both consumers and industry stakeholders. The investors perceive this collaborative model as a key driver for the startup’s scalability and market expansion.
   
5. Strong Track Record and Growth Potential: MyCover.ai has already demonstrated its viability and market traction. With over $1 million in gross written premiums, partnerships with 30 insurance distributors, and thousands of policies processed, the startup has established a solid foundation for growth. The investors are impressed by the company’s revenue doubling in 2022 and its ambitious plans to replicate this growth in the coming years. They recognize MyCover.ai’s potential to become a leading player in the Nigerian and broader African insurance markets.

A Look at MyCover.ai

MyCover.ai was founded in 2021 by co-founder and CEO Adebowale Banjo, along with CPO Alexander Igwe-Ifendu and CTO Fred Ebho. The startup’s primary markets are in Nigeria, with plans to expand into other African markets strategically. MyCover.ai offers an open insurance API that integrates with insurance companies, including Hygeia, Leadway, Sovereign Trust, AIICO Insurance, and Allianz.

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The startup’s API allows various businesses, such as fintechs, proptechs, e-commerce companies, telcos, logistics and mobility/ride-hailing platforms, and BNPL (Buy Now, Pay Later) platforms, to embed personalized insurance products into their platforms. This enables third-party logistics platforms, for instance, to offer on-demand goods in transit coverage for their fleet and provide health insurance and personal accident coverage for their riders.

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In addition to its API products, MyCover.ai has a B2B platform called MyCoverGenius. This platform allows entrepreneurs and small and micro-businesses to purchase insurance products from MyCover.ai, covering their staff and assets. The startup aims to improve customers’ insurance experiences by offering personalized products based on lifestyles and specific needs.

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