PolicyBazaar: Navigating the Insurance Landscape with Excellence

PolicyBazaar stands as India’s premier aggregator and marketplace for insurance products, a stalwart establishment in the industry since its inception in 2008. Initially conceived to compare the prices of insurance policies and disseminate pertinent information related to insurance, the company has experienced exponential growth, propelling it to diversify and expand its offerings.

Beyond its foundational role as an insurance marketplace, PolicyBazaar has evolved to provide comprehensive support in the nuanced processes of policy cancellation, renewal facilitation, and expeditious claims settlement. This strategic augmentation of services underscores the company’s commitment to delivering a holistic and client-centric approach in the realm of insurance solutions.

PolicyBazaar  Overview: Facilitating Seamless Insurance Solutions

PolicyBazaar stands as a comprehensive marketplace catering to diverse insurance needs, encompassing life insurance, health insurance, car insurance, travel insurance, group insurance, and more. With a repertoire of over 250 insurance plans from approximately 50 reputable insurance brands, PolicyBazaar offers a user-friendly platform that enables visitors to effortlessly compare various insurance plans and make informed decisions aligning with their individual requirements.

In its commitment to enhancing customer experiences, PolicyBazaar continually integrates new features and technologies into its platform. The introduction of the ‘My Account’ feature exemplifies this dedication, allowing customers to conveniently download policies, raise tickets for queries, seek clarifications, and manage policy upgrades. As part of its innovation strategy, PolicyBazaar has also introduced a self-inspection video feature tailored for the revival of lapsed motor insurance policies.

The advent of PolicyBazaar’s mobile application in 2015 marked a significant milestone. Available on both Android and iOS platforms, the app transcends traditional functionalities by enabling users not only to search, compare, and purchase insurance but also to access a range of value-added features. These features include a hospital locator, garage locator, insurance premium calculator, instant policy renewal, and comprehensive claim assistance.

Industry Landscape and PolicyBazaar’s Positioning

In the broader context of the Fintech market in India, as forecasted by NASSCOM, the sector is poised to reach a valuation of US$ 2.4 billion by 2021. Simultaneously, the insurance industry in India is projected to touch the $280 billion mark by the same year. Despite these optimistic projections, a significant segment of the Indian population remains without any form of insurance coverage. The overall insurance penetration, represented by the premium as a percentage of GDP, stood at a modest 3.69% in 2017, indicating a substantial untapped market for insurance services in India.

PolicyBazaar, positioned at the forefront of this dynamic landscape, continues to play a pivotal role in bridging the gap and addressing the latent demand for insurance products and services. Through its technological innovations, comprehensive offerings, and commitment to customer-centric solutions, PolicyBazaar remains a key player in propelling the growth and accessibility of insurance in the Indian market.

PolicyBazaar – Mission and Vision

At the core of PolicyBazaar’s organizational ethos lies a resolute mission: “Building a safety net for households in India.” This unwavering commitment underscores our dedication to providing a robust financial safeguard for families across the nation.

Aligned with this mission is our visionary outlook, encapsulated in the statement: “A healthy and well-protected India.” PolicyBazaar aspires to contribute significantly to fostering a society where individuals are not only in good health but are also well-secured through comprehensive insurance coverage.

PolicyBazaar – Business Model

PolicyBazaar.com stands as a premier insurance aggregator website, serving as a pivotal resource for customers seeking to research and compare features of diverse insurance policies within a specific category. Our platform empowers customers to make informed decisions in selecting policies that align with their unique needs. The PolicyBazaar insurance aggregator business model operates seamlessly across both the B2C and B2B landscapes.

In collaboration with esteemed insurance brokers, we diligently procure essential information, including pricing, benefits, and coverage details, directly from these partners. This curated information is then presented to our customers, enabling them to discern and choose the optimal insurance option. It is imperative to note that PolicyBazaar does not levy any charges on customers for this invaluable service.

PolicyBazaar – Revenue Model

PolicyBazaar’s revenue model is multifaceted, encompassing lead generation for insurers, advertising, and policy sales. Historically, up to 2011, 85% of our revenue was derived from lead generation and advertising, with the remaining 15% stemming from policy sales. In the present landscape, a paradigm shift is evident, with 85% of our revenue generated through e-commerce and policy sales. This dynamic revenue model underscores our adaptability and resilience in the ever-evolving insurance landscape.

PolicyBazaar’s Initial Public Offering (IPO) and Employee Stock Option Plan (ESOP)

Initial Public Offering (IPO)

PolicyBazaar, a leading digital insurance provider, had initially set its sights on an IPO in August 2021 and submitted its Draft Red Herring Prospectus to SEBI at that time. The filing indicated an ambitious fundraising target of approximately Rs 6017.5 crores, comprising a fresh issuance of shares amounting to Rs 3,750 crores and an offer for the sale of shares worth Rs 2,267.5 crores by existing shareholders. 

Additional funding of up to Rs 750 crores was also under consideration, as per recent reports.

Despite the initial plans, the IPO did not materialize in August. Subsequently, a meeting held on September 24th by the board of directors approved the allotment of 20,20,202 equity shares of Policybazaar Insurance Brokers at a premium price of INR 485 to its parent firm PB Fintech Ltd.

While the IPO of PB Fintech Ltd., PolicyBazaar’s parent company, received approval from the Securities & Exchange Board of India (SEBI), it did not immediately impact investor sentiments in the unlisted space. As of October 19, 2021, the share price of PolicyBazaar in the unlisted market remained relatively stable at around Rs 1,700-1,800.

The much-anticipated IPO of PolicyBazaar’s parent company, P.B Fintech, finally commenced on November 1, 2021, with the retail portion witnessing a remarkable 36% subscription within the first hour. The IPO concluded on November 3, 2021.

The IPO price for PolicyBazaar was fixed at Rs 940 to Rs 980 per equity share, experiencing a noteworthy surge of over 20% above the IPO price. The stocks were listed on the BSE at a 17.35% premium to the issue price of Rs 980. The PolicyBazaar stocks exhibited a subscription rate of 16.59X, closing at Rs 1203 on the NSE, marking a 22.74% increase over its IPO price. This valuation positioned the company at $7.27 billion as of November 16, 2021.

Employee Stock Option Plan (ESOP)

On August 1, 2023, PB Fintech, the parent company of PolicyBazaar and Paisabazaar, introduced new options for its employees under the existing Employee Stock Option Plan (ESOP) 2020 and 2021. In accordance with a stock exchange filing, the company issued 5,44,929 eligible members stock options at an exercise price of Rs 2 under the PB Fintech Employees Stock Option Scheme 2020 and 2021. The estimated value of these newly awarded ESOPs by PB Fintech, based on the current stock price, was approximately Rs 40 crores, as reported by Fintrackr.

PolicyBazaar – Achievements in Growth and Revenue

PolicyBazaar stands as the foremost insurance aggregator in India, maintaining an impressive track record in both visitor engagement and transactional success. With an annual run rate of 100 million visitors, the platform has consistently facilitated over 300,000 transactions per month. 

The following key metrics highlight the substantial growth achieved by PolicyBazaar:

• Monthly Policy Sales: PolicyBazaar has consistently demonstrated robust performance, achieving sales of over 15,000 policies in a single month.
• Revenue Growth: In the fiscal year 2017-2018, PolicyBazaar realized an exceptional revenue growth of 225%, underscoring its financial prowess and market position.
• Valuation Milestone: Following a strategic investment of $200 million from SoftBank and Info Edge in May 2018, PolicyBazaar’s valuation surpassed the $1 billion mark. This achievement solidified its status as the second fintech company in India to join the prestigious unicorn club, following Paytm.
• Market Dominance: PolicyBazaar has played a pivotal role in shaping the online insurance landscape, initially claiming around 50% market share. Remarkably, by April 2022, this market share had expanded to an impressive 93.4%, further establishing PolicyBazaar as the unrivaled leader in the online insurance sector.

PolicyBazaar – Competitors

Major Competitors

BankBazaar

CoverFox

EasyPolicy

CreditMantri

PolicyAdvisor

Acko

InsurancePandit

PolicyBazaar – Business Partners

Insurance Sectors

Car Insurance

Health Insurance

Life Insurance

Corporate Insurance

Travel Insurance

PolicyBazaar : Market Challenges

In addressing the current market landscape, Sai Narayan, the Marketing Head at PolicyBazaar, underscores the significant challenge posed by customer inertia. A prevailing habit persists among individuals to procure insurance through traditional agents, requiring concerted efforts to sway this demographic towards embracing online insurance purchases.

Narayan further identifies a second challenge within the Indian market, where the prevailing perception views insurance primarily as a tax-saving instrument. This narrow perspective results in a concentrated surge in insurance sales during the January-March period, indicating a limited understanding of the broader significance of insurance beyond its tax-saving implications.

PolicyBazaar Systems Security Incident

PolicyBazaar recently encountered a cybersecurity incident where its systems were compromised. The insurtech major disclosed the identification of vulnerabilities within the IT systems of PolicyBazaar Insurance Brokers. These vulnerabilities were subjected to illegal and unauthorized access. 

Notably, the company assures that the breach did not compromise substantial customer data, as confirmed in reports dated July 25, 2022. PolicyBazaar promptly addressed the identified vulnerabilities and has initiated an audit to assess the extent of any potential damage. Additionally, the company has reached out to relevant authorities to report the incident.

PolicyBazaar : Acquisition of Visit Internet Services

In a strategic move to enhance its market presence, PolicyBazaar successfully acquired Visit Internet Services on January 15, 2022. The transaction amounted to Rs 22.4 crore, solidifying PolicyBazaar’s commitment to expanding its portfolio and strengthening its position in the insurance and financial services sector.

Conclusion 

In conclusion, PolicyBazaar’s journey exemplifies resilience, innovation, and a steadfast commitment to revolutionizing the insurance landscape in India. As a market leader, the company continues to shape the industry through its unwavering dedication to customer satisfaction, technological advancements, and strategic business initiatives.