Simply Financial Services; a South African insurtech startup that is looking to disrupt the life insurance mass-market in the country, has secured a substantial multi-year funding commitment from Yellowwoods; a private investment group.
Since its inception in November 2016, Simply has set out to revolutionize mass-market life insurance in South Africa. This it does by designing and serving up simple and valuable life insurance products to a considerable number of individuals. Having secured the investment, the growth aspirations of the company can be expected to receive something of a major boost.
Simply Financial Services was established by a tech entrepreneur, Anthony Miller, and actuaries, Simon Nicholson and Shaun Dippnall. The startup’s scope of operations is known to span such cover options as Domestic, Family, and Group. These cover options are believed to be collectively supported and guaranteed by Old Mutual Risk Transfer Ltd (OMART).
Miller, who plays the role of CEO in the two-year-old startup, considers the investment from Yellowwoods a major boost for the company. According to him, there is something of a renewed belief in the startup’s model as the investment from Yellowwoods; one of the most successful investors in South African insurance, is a testament to the fact that the company is on the right trajectory. He also cited the life insurance and business know-how, as well as the access to potential local and international partners which the private investor brings to the table, as some of the additional perks that come with the deal.
The startup may actually be in for significant growth in the coming months given that it is focused on South African insurance niches that can be thought to be underserved. The CEO also gave the indication that the growth strategy of the company is hinged on becoming the digital insurer of choice in South Africa when it comes to specific niches that have a tendency to opt for a simple digital product.
According to him, this strategy is buoyed by indices which suggest that the world is moving online at an exponential pace and South African customers are not left out as they are going digital faster than most existing players give them credit for. With that in mind, Simply could be considered poised to take pole position in what could be termed the imminent digital revolution of South Africa’s insurance sector.
Having added Simply to its investment portfolio, the private investment group’s already-burgeoning stake in a number of emerging local and international insurance companies can be thought to have expanded even further. Before the investment agreement with Simply, names like SA-based Hollard and Clientele, Naked Insurance, as well as machine learning startup, DataProphet, are a few mentions of enterprises that can be linked to Yellowwoods.
With regards to the development, Scott Gilmour, Director of Yellowwoods, opined that the move to invest in disruptive businesses such as Simply was motivated by the need to take advantage of the apparent shift in the manner in which customers now interact with and purchase financial services products.
He also highlighted the startup’s flexible and exportable business model, the strength of its team, as well as the transparent value proposition which it offers to customers and the technology which props the business, as some of the factors that weighed in making the deal something of a no-brainer. According to Gilmour, with time, the insurtech startup’s offerings within its niche market segments could be reproduced in all areas of the market.
Simply’s CEO, Miller, also hinted that the insurtech company is ready to business with large incumbent life insurers who are looking to improve their digital efforts. In the same vein, he gave the indication that the business’ growth strategy is, as well, connected to providing assistance to non-insurance players who are looking to provide life insurance products to their customers. Miller also expressed confidence in the results that can be achieved by merging the digital capabilities of Simply with the brand affinity of such companies in the process of forging partnerships.
Simply has built its model around providing simple, value-for-money, life insurance products; catering for such areas as life, disability, and funeral cover. These insurance products are largely sold online, typically taking only a few minutes to complete as no medical tests are required. The insurtech startup targets market niches that receive little attention from more established insurance players. Its customer-base can be thought to currently include individuals underserved by traditional insurers, employees within SMMEs, as well as domestic workers.
As estimated by Yellowwoods, around USD 7.7 Bn in premiums is realized by the South African individual life insurance market on a yearly basis. More so, the online and digital portions of the market have been projected to witness up to 15 percent growth over the medium term. And these figures may have motivated what could be considered the private investment group’s maiden investment agreement with a largely digital-centered life insurance company.