UK insurance tech (insurtech) firm PremFina has raised $36 million in both debt and equity financing led by Rakuten Capital and Draper Esprit. Other participants in the round include Thomvest Ventures, Emery Capital, Rubicon Venture Capital, Talis Capital, and the company's founder Bundeep Singh Rangar.
According to the company, the equity portion of the funding round was three times oversubscribed.
The new funds will be invested in developing its software product for insurance brokers and further internationalisation. PremFina operates a SaaS solution and funds the upfront payment of an insurance premium to an insurer and collects monthly instalments plus a fee from the insured party.
“The participation of outstanding investors from Toronto to Tokyo in our oversubscribed round highlights the vast opportunity ahead for PremFina,” commented CEO Bundeep Singh Rangar, who invested in 17% of the equity portion of the round. “Our new investors bring great strategic value and priceless global financial relationships.”
Premium financing has been in need of innovation with insurtech lagging behind other areas of fintech, he added.
“The incumbents have remained largely unchallenged due to age-old barriers to entry, such as the lack of funding for insurance startups, costs and time of regulatory compliance and significant investment in technological capability needed to meaningfully enter the market,” he said.
“Rakuten sees outstanding growth potential in PremFina’s business model of promoting insurance inclusion and providing access to affordable insurance,” added Oskar Mielczarek de la Miel, managing partner at Rakuten Capital.