Fuse Insurtech (12/13) announced additional series B+ funding of over $25 million (approximately 363 billion Rupiah). This round was led by an undisclosed global investor with specialization in raising funds for fintech, with the participation from previous investors such as East Ventures (Growth Fund), GGV Capital, eWTP, and EMTEK.
Over the past six months, Fuse had closed three Series B funding rounds of over $50 million (approximately 725 billion Rupiah) in total. In other words, strengthening Fuse’s position in the centaur list. The fresh funds will be used to expand to more countries in Southeast Asia. The company currently has more than 460 employees, with branch offices in Indonesia, Vietnam and China.
Fuse’s Founder & CEO, Andy Yeung expressed his delight that Fuse has been recognized by global-scale fintech investors amidst the rapid competition in Southeast Asia’s insurtech market. We are excited to gain access and insight from other fintech and insurtech portfolio companies in this global network.
“The strong interest from global investors, along with our recent achievement by entering the World’s Top 100 Insurtechs 2021 list published by Sønr Global and Ernst & Young, reaffirms our current ecosystem approach. The technology platform developed by Fuse makes insurance more accessible to people in Southeast Asia,” Yeung said in an official statement.
He continued, based on a report, Southeast Asia’s middle class is predicted to grow to 350 million consumers with $300 billion income and increasing digital literacy. He said, Fuse is well positioned to enter this large, under-penetrated insurance market through its unique technology platform, which provides a variety of distribution channels adjusting to consumer needs.
“With the investor’s trust, insurance companies, business partners and end-customers, Fuse will continue to do its best to develop the most affordable insurance products and meet their needs. We strongly believe that the transformation of digital insurance can help more people get insurance protection, and hopefully insurance penetration rates can increase substantially in the years to come in Indonesia and Southeast Asia.”
Since its debut in 2017, Fuse has taken an application approach to enable insurance sales with a B2A (Business to Agent/Broker) business model. The company has a comprehensive business model, B2A, B2C comparison, B2B2C (micro insurance and financial institute), which allows it to help partners distribute insurance products with affordable operating costs to end-customers.
There are more than 60 thousand marketers/partners are using the Fuse Pro application to market insurance products. The company also collaborates with more than 40 insurance companies, ranging from general insurance companies to life insurance companies, which supports Fuse to provide more than 300 insurance products for end-customers.
Since the third quarter of 2021, Fuse has been officially appointed by Tokopedia as a strategic insurtech partner to provide all general insurance products for Tokopedia users. As of last September, Fuse’s gross premium income (Gross Written Premium/GWP) has exceeded IDR 1 trillion, making Fuse the largest insurtech company in Indonesia.
In a previous interview with DailySocial.id, Yeung explained that agents/brokers play an important role in the insurance sales chain and they will not be disrupted by technology in the near future. Finally it was decided to build a Fuse Pro application to enable and support agents/brokers in digitization. At the same time, helping them turn their offline business into online.
“In other words, we are ‘shifting existing insurance’ online, rather than trying to ‘create’ new insurance markets like microinsurance. That’s why we focus on this agent/broker business model, especially from day one,” he said.
The agent’s essential role
Actually, insurtech startups currently also have agency services to boost sales of insurance products through agents (B2B) in addition to retail channels (B2C). PasarPolis has PasarPolis Partners and Qoala with Qoala Plus Partners. However, both of them focus from retail first to business, while Fuse is the opposite. There is nothing wrong with these two business segments as it has the same objective, to increase the penetration of insurance products in Indonesia.
Agents are at the forefront of insurance companies in driving its business. According to Indonesian Life Insurance Association (AAJI), this channel contributed to 36.1% of the total life insurance premium income until the third quarter of 2020. Moreover, followed by the bancassurance line 46.95% and the telemarketing line 1.88%, and others 15 0.06%. In total, the number of licensed insurance agents rose 2.1% to 635,326 people during the period.
AAJI’s Executive Director, Togar Pasaribu said, for life insurance companies, agents are like fresh blood. If you don’t do recruitment, it will endanger the company that adopts the agency strategy. “Please note that not all life insurance companies use agencies as their distribution channel. Therefore, this only applies to life insurance companies that use agents as salespeople,” he said as quoted from Kontan.
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Original article is in Indonesian, translated by Kristin Siagian
