Waada, subject to regulatory approvals, has acquired MicroEnsure Pakistan, a division of MIC Global, in an all-stock deal to bolster its revenue and customer base. In addition, it has closed a seed round of $1.3mn from local angels and foreign VCs.
This acquisition will bring distribution agreements & existing customers to the Waada portfolio making Waada the largest Pakistani Insurtech. With this, it also becomes the only insurance brand with agreements with all four telecommunication companies, for leads and talk-time balance to charge daily premium. The combined brand now has more than 1.5 million active customers.
“Pakistan Insurance penetration is 0.7%, lowest in the region. Technology can play a huge role to tap that gap, specifically through creating the gig economy for agents & underwriters. This acquisition gives us the strength to lead that innovation from the front. CEO & Founder, Ishaq Kothawala
MIC Global, has been involved in the Insurance business for the past two decades in South Asia and Africa. It is a full stack digital insurance company focused on supporting Insurtechs globally, building embedded insurance programs through its licensed reinsurance company and Lloyds Syndicate 5183.
“We are really excited about the acquisition of our Pakistan operations by Waada. Together, with our global insurance experience and Waada’s strong on-ground presence , we can achieve great scale in Pakistan & beyond” CEO of MIC Global, Harry Croydon
Today 95% of Insurance in Pakistan is sold through tied agents. Distribution is fractured where agents & underwriters spend most of their time in non-value-added tasks; like paper work, cheques collections, matching payments, manual signatures, coordinating inspections, rate negotiations, agent registration, commission reconciliation etc. As a result, user experience is sluggish and expense ratio for companies to support the brick-and-mortar infrastructure is high.
“Insurance is about selling a future promise (Urdu: ‘Waada’), hence, establishing that trust to fulfill that Waada is crucial in distribution. Our primal nature depends on human connection to establish that trust. Therefore, I believe agents are always going to play a key role in Insurance distribution. The need is to automate every process, from underwriting to policy issuance, from leads management to commissions & claims, in order to empower agents to focus on selling and not the admin” CEO & Founder, Ishaq Kothawala
Together with signing up Telcos and other Platforms, Waada’s vision is to use technology to digitize agency distribution and claims. Waada’s in-house platform enables anyone in the country to virtually sign-up, watch training videos, qualify as a gig agent and get policies issued within minutes without ever visiting Waada’s premises. This automation creates value by reducing admin cost in the distribution chain enabling Waada to offer a higher commission to agents and lower price to the customer.
Nadeem Hussain – Coach at Planet N, which structured the transaction, said “we were co – founders of Waada , and are excited about this transaction . This is the first of many consolidations which the Pakistan market will experience ‘
With this consolidation, Waada’s goal is to become the leading brand of insurance in the country, distributing 10 million policies in the next 3 to 5 years.