Paytm, India’s most valuable start-up, and its co-founder and president, Vijay Shekhar Sharma, announced on Monday they have actually reached an agreement to acquire general insurance company Raheja QBE for an amount of $76 million as the financial services startup wants to tap the country’s booming insurance coverage market

. Sharma is getting Raheja QBE through QorQl Pvt. Ltd, a company in which he owns majority stake with Paytm owning the remainder. Raheja QBE, which provides insurance coverage services to cover an individual’s health, house, lorries, and also offers defense on commercial homes, and workplace injuries, is owned by Prism Johnson (51%) and QBE Australia (49%.) QorQl is acquiring 100% of Raheja QBE as part of the arrangement, the 2 entities said.

Paytm, whose services are used by 10s of countless Indians each month, said the acquisition will assist it “democratize basic insurance coverage services” in the nation.

Raheja QBE’s “strong management team will assist us accelerate our journey of taking insurance coverage to the large population of India with the aim to develop a tech-driven, multi-channel basic insurance company with budget-friendly and innovative insurance coverage items,” stated Amit Nayyar, President of Paytm, in a declaration.

In India just a fraction of the country’s 1.3 billion people presently have access to insurance and some experts say that digital firms could show crucial in bringing these services to the masses. According to ranking agency ICRA, insurance items had reached less than 3% of the population since 2017.

An average Indian makes about $2,100 in a year, according to World Bank. ICRA estimated that of those Indians who had actually purchased an insurance coverage item, they were spending less than $50 on it in 2017.

In the last few years, ratings of start-ups and established banks have actually released products to win this market. For Paytm, which runs a variety of organisations consisting of a digital bank and online loaning, sachets of insurance could fit well in its overall offerings.

“This relocation will assist the insurance coverage company scale approximately new heights by leveraging the big client base and ingenious products used by Paytm,” stated Vijay Aggarwal, Handling Director of Prism Johnson, in a declaration.

Raheja QBE’s acquisition undergoes popular conditions, including approval from the Insurance Regulatory and Advancement Authority of India (IRDAI), the 2 companies cautioned.

More to follow …

Article curated by RJ Shara from Source. RJ Shara is a Bay Area Radio Host (Radio Jockey) who talks about the startup ecosystem – entrepreneurs, investments, policies and more on her show The Silicon Dreams. The show streams on Radio Zindagi 1170AM on Mondays from 3.30 PM to 4 PM.