INDIAN INSTITUTE Of MANAGEMENT RAIPUR

PolicyBazaar

PolicyBazaar is India’s largest aggregator and marketplace of all insurance products.

PolicyBazaar helps customers in researching and comparing various insurance policies, helping
them in making an informed decision. It offers everything from life insurance, health
insurance, motor insurance and other insurance such as travel insurance and group insurance
etc. PolicyBazaar has tied up with various insurance brokers which help them in procuring
details about the insurance policies directly from insurer. The company offers over 250
insurance plans and around 50 insurance brands on its platform. The platform is designed so
that visitors can easily compare insurance plans and can buy plans based on their personal
insurance needs. PolicyBazaar doesn’t charge anything for the service.

History
The idea of PolicyBazaar came in mind of Yash Dahiya when his father had been cheated of a
few lakh rupees by insurance agents. The transaction looked clean on the face of it, but reality
emerged when looked closely.

PolicyBazaar was founded by Yash Dahiya (CEO), Alok Bansal (CFO) and Rahul Agrawal (CTO)
in year 2008. PolicyBazaar is headquartered in Gurugram, Haryana. PolicyBazaar was started
with 14 hardworking individuals. PolicyBazaar’s parent company is EtechAces Marketing and
Consulting Pvt. Ltd.

In 2008, PolicyBazaar used to compare the prices of different insurance policies and provided
information about the insurance. Now, PolicyBazaar not only helps in buying the insurance
policy but it also assists in renewal or cancellation of insurance policy.

In 2015, PolicyBazaar app was launched on android and iOS platform. A customer can not only
look for insurance policy and buy them. It also provides some interesting features like hospital
locator, garage locator, insurance premium calculator, claim assistance etc.

PolicyBazaar also adopted Amazon Polly and developed in-house AI chatbot named PBee to
improve customer satisfaction.

In 2018, PolicyBazaar launched DocPrime, an online medical service platform. DocPrime

provides real-time consultation with doctors through chat and call. Within 6 months, website
received 1 million unique visitors.

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 PolicyBazaar.com: A Report

PolicyBazaar has raised funding of around $476.6 Million in 8 rounds from 15 different
investors. PolicyBazaar gets 100 million visitors each year and it sales over 15000 policies per
month. PolicyBazaar has been consistently at 100% since 2008.

Group Companies

PaisaBazaar.com -
India's leading marketplace for loans and cards offering everything from low-cost EMIs to high-
return mutual funds, making personal finance decisions easy, convenient and transparent.

DocPrime -
Redefining healthcare services by connecting patients and doctors in real time with online
consultations through chat and phone, at the same time facilitating online doctor
appointments and lab tests at affordable rates.

QuickFixCars -
Complete car care aggregator bringing together a vast network of garages, skilled mechanics,
free pickup and drop services, car maintenance and repair, and a simple booking process just
a click away.

PolicyBazaar.ae -
India’s largest and most trusted web-based insurance aggregator, now in UAE, empowering
people by giving them the option to compare and buy the best insurance plan as per their
needs.

Awards

• Best bank in Fintech by Finance Express Best Bank in 2019

• Best Consumer Awareness Campaign – Silver at Economic Times Brand Equity
Kaleido Award 2019
• Leading Fintech Innovator in India by KPMG-H2 ventures Report 2018
• Best Marketing & PR Campaigns at India PR & Communication Awards 2018
• Insurance Innovation Award at The Digital Insurer Global Livefest Award in 2018
• Best Online PR Campaign at Drivers of Digital – Inkspell Awards 2018
• Emerging Star Award at BML Munjal Award 2017
• Insurtech Innovation of the Year at Moneytech Awards 2017
• Award for Best Mobile App Consumer Finance in 2015 by GSF Mobile Appies
• Exchange4media Golden Mikes Award 2015
• DMAi Asia ECHO Awards 2015
• CMO Asia Awards 2015
• BAM Award 2015
• Excellence in Operations at Iconic IDC Insight Awards 2015
• IAMAI Indian Digital Awards for best financial website 2013-2014
• Frost and Sullivan Customer Value Leadership Award – 2014

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 PolicyBazaar.com: A Report

Competition in the industry

The major competition for PolicyBazaar in the online policy marketspace is companies like
BankBazaar, EasyPolicy, PolicyAdvisor and online policy brokers such as Coverfox and Acko.

The online insurance marketspace is very dynamic and highly competitive. Insurers are now
compelled to ensure their pricing is competitive and are able to show value for money to the
consumer in order to remain relevant. By increasing levels of transparency in product features,
cost and services, digital channels are levelling the playing field. Traditionally the threat for
online policy aggregators like PolicyBazaar are the other similar players who offer similar
services of providing the platform not owning the actual product, but with players like
Coverfox and Acko who own the insurance and are full-fledged online insurance brokers are
making the space even harder to compete. To rise to the competitive forefront, market players
are rethinking and realigning their business models and strategies as per customer needs and
the expectations of future target groups who soon will be their new consumers in few years.
Also, with the decline in relevance of traditional products with decreasing number of customer
touchpoints it is utmost important to innovate the existing insurance product/service
offerings to meet changing customer behavior and needs. Ecosystem services can not only
help you build loyalty but also increase profits in the long run.

The Insurance landscape in India is surely seeing a shift but still traditional methods are still
very relevant and motivating customers to go online is still a herculean task to do. As per the
report by PWC, 27% of the insurance buyers still relies on Word of Mouth, 22% on Agents, this
forms almost 50% share of users who still go online for their insurance needs. Among the rest
50% the market is very much fragmented, only 20% of the consumers rely on the online
aggregators such as PolicyBazaar, theses 20% are shared among all the players in the market.
It is thus critical for PolicyBazaar to develop a future-ready strategy and continue to innovate
by having a prudent look at these macro-level disruptions happening in the Indian insurance
market and changing consumer behavior. As digital technologies are becoming more
pervasive year on year, they are diminishing the barriers to entry such as prohibitive costs and
enable the scaling of operations on demand. As a result, the competitive set is bound to
change rapidly.

Business Model of PolicyBazaar

In India, people don’t buy insurance easily. They love to go through thorough analysis before
buying an insurance. From the beginning, the insurance agents used to help the customers to
make this decision. But with the increase in availability of huge number of options in insurance
segment too, many a times, the agent might get biased by the companies providing huge
incentive.

PolicyBazaar has the unique value proposition of simplifying the buying process of insurance
policies and provide comparison of various schemes available in the market. It analyses the
various products on the basis of price, quality and key benefits. Being a policy web aggregator,
Policybazaar empowers its customer with the accurate information which indeed helps them
to make a buying decision.
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 PolicyBazaar.com: A Report

Market Segments

PolicyBazaar basically targets all the customers in India who want to buy the insurance but has
less to no knowledge of insurance segment. Most of the Indians don’t have insurance due to
number of reasons, specifically, due to mis-selling or lapsing of policies.

BankBazaar, CoverFox, EasyPolicy, PolicyAdvisor, Acko and InsurancePandit are some major
competitors of PolicyBazaar in India.

Growth Model

PolicyBazaar is following “Run” strategy. The company is adding new features and technology
to provide enhanced customer experience. The have launched mobile Apps in android and iOS
platform too. The platform provides freedom to visitors to check policies and compare them
on their aspects.” A customer can not only search, compare and buy insurance through the
PolicyBazaar app, but there are also interesting features like hospital locator, garage locator,
insurance premium calculator, instant renewal of insurance policies, claim assistance and
more.”

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 PolicyBazaar.com: A Report

Capabilities
RESOURCES
• India’s largest insurance aggregator
• Business partnership with over 50 major insurance companies including Aegon life,
Aviva Life Insurance, Bajaj Allianz, Cigna, Edelweiss Tokio Life, HDFC Ergo, DHFL
Pramerica Life Insurance, HDFC Life etc
• Series of funding of over $350 million from major investment groups such as
Softbank, Infoedge, Intel Capital, PremjiInvest, Tiger Global Management etc.

ACTIVITIES
• Tie up with insurance brokers
• Procure information such as price, benefit, insurance cover etc.
• No charges from customer
• Revenue is generated through fee from insurance companies for fixed marketing
and advertisement
• New features and technology to improve customer experience
• ‘Self - inspection video’ feature for motor insurance revival
• Launch of App with features such as insurance premium calculator, instant renewal
of insurance policies, claim assistance

Teece Model

PolicyBazaar is basically an insurance policies aggregator, the insurance policies and assets
required to build a market aggregator are freely available. Also, there are various competitors
are present in the market as this model can be imitated easily. Hence, in the following matrix
of complementary Assets and Imitability, the PolicyBazaar belongs to 1st quadrant i.e. Freely
Available Complementary Assets and High Imitability.

For its position at first quadrant, PolicyBazaar has adopted “Run” strategy. They are
continuously improving their services by adding various interesting features like hospital
locator, garage locator, insurance premium calculator, etc. This will help them to sustain in
that quadrant.

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Profitability potential of the company

Currently PolicyBazaar has 50 % market share in the online insurance space, it also claims a
25% market share of India's life insurance cover and around 7% of India's retail health
insurance business. If we talk about financial backing of the firm, the firm has raised a total
funding of more than $476.6 Million in 8 rounds from 15 different investors with 5 being the
lead investors, lately back in May 2018, PolicyBazaar raised $200 million funding from
investors like Softbank and Info Edge. Recently it raised $130 million of funding from a Series
G round. PolicyBazaar’s revenue for the FY18 reached $21.67 million (INR 159.4 Cr), against
$6.67 million (INR 49.1 Cr). It is also interesting to note that operational revenues contributed
99.3% of total revenues reaching $21.52 Million (INR 158.3 Cr), This comes on the backdrop
of 383% increase in its operational income in FY17. It is also worthy to mention that
PolicyBazaar’s highlight from the last year was 78% control in its losses reaching $1.27 million
(INR 9.4 Cr) from $5.97 million (INR 43.9 Cr) in the previous financial year. The future financial
plans for the company look quite aggressive with:
• Underwriting premium worth INR 10,000 Cr by 2020
• Expanding its unique customer base to 100 million by 2020
• Innovating new products and technology for better customer satisfaction
• Expanding outside India
• PolicyBazaar is also expected to launch its IPO soon and currently in talks with
banks for the same
Now to increase profitability the company has to build complementary capabilities as the
current offerings are imitable and have been offered by the competitors as well. Innovation
will become a key differentiator across the industry and hence will directly impact the
profitability of the company in future, the industry needs disruption in terms of customer
touch points, the product/service offering, etc. With internet giants like Paytm taking over
Coverfox the landscape will become more competitive as Paytm already the advantage of a
integrated platform and huge customer base offering varied services, this acquisition will arm
Paytm with complimentary capabilities as it can push the travel insurance with the air/bus/rail
tickets it offers through its platform. PolicyBazaar has started diversifying its business, though
still being the aggregator, the services offered and industries are completely different, last
year it launched DocPrime, an online medical service provider platform which works real time,
the platform has gained a lot of traction with over a million users in just one month of its
launch.

With the changing online aggregator space and reduced barrier to entry, sustaining
profitability is only possible through constant innovation and creating a competitive
advantage in the market, the consumer is looking for customized variety solutions and higher
the level of customization a platform provides the higher its chances to earn the major chunk
of the industry profits.

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 PolicyBazaar.com: A Report

Strategies to compete in the market and become profitable

PolicyBazaar is a platform mediated network which connects insurance seekers to various

insurance policies. Currently, 70% sale of overall online insurance happens through
PolicyBazaar and in online lead generation segment where insurance aggregators sell lead to
insurers, PolicyBazaar dominates the market with 4 out of every 5 leads (via internet) claimed
by them. Hence it is clearly visible that Network effects of the PolicyBazaar is high as there are
a large number of users as well as insurers available on the platform. There are 100 million
visitors each year and more than 250 insurance plans on the platform. Hence, the focus should
be on increasing positive network effects by attracting user en masse.

There is no multi-homing cost. Since, PolicyBazaar doesn’t charge its users. Hence, users can
switch to different platforms easily. So, to retain users on the platform, PolicyBazaar can
provide unique value proposition (platform differentiation) from different insurance
companies to its users e.g. discount on insurance policies, exclusive insurance policies on
PolicyBazaar etc.

PolicyBazaar can also focus on providing complimentary services besides insurance policies
for the users. So that PolicyBazaar will become one stop solution. It is also going to start its
new vertical in financial services.

Additional information

Tencent Holdings Ltd. has acquired a minority stake (10% shares) in PolicyBazaar to enter into
the insurance industry. PolicyBazaar is the startup which is going to disrupt the insurance
sector with tight regulatory controls. The investment from Tencent is expected to be used in
launching the new venture in coming months. The new venture will cover financial services
and is aiming to look at growth of these businesses and existing verticals. India’s burgeoning
internet economy has endowed the country with market conditions similar to that of China or
may be even better, categorized by increasing mobile internet penetration, and rising
consumption levels. This creates a favorable investment environment for Chinese firms with
experience dealing. However, one of the challenges Indian internet firms face is attaining the
level of localization required to scale a business within the country. Tencent’s investment
activity has adopted an increasingly regional focus, as the company expands outside its
domestic market and explores opportunities in Asia more broadly.

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