South Africa’s Naked Raises $11m In Series A Round To Increase The Reach Of Its Insurance Products

Not too long after Agritech startup raised $1.3 million in a seed round, Naked, another South African startup has raised $11 million in a Series A round. Naked is a South African insurtech startup. It provides digital services that provide insurance for users, insuring their homes, vehicles, standalone property, etc.

The funding round was led by Napers through its early-stage fund called Naspers Foundry. It led the funding round with $8.3  million and has a long history of funding startups in South Africa with the investment in Naked being its largest so far. Other participants of the round include existing investors Yellowwoods and Hollard.

Naked came into existence in 2018 and was founded by Alex Thomson, Sumarie Greybe and, Ernest North. What Naked does is that it uses artificial intelligence to create new insurance processes and experiences for its customers and give them products that suit their needs.

Naked is one of the many companies that are leveraging on the booming digital trends of providing goods and services. The pandemic created a shift in how South Africans go after products including insurance products. Everybody now wants to access services conveniently from the comfort of their homes without having to visit any physical location.

Naked is more preferred to other insurance solutions because it provides lower costs when compared with other contemporary options, as it is devoid of the costs associated with operating and maintaining physical locations. It also gives users autonomy over insurance products, decisions and, experience. Its products are also designed to be flexible and free from hidden charges or having to pay for a service that’s not in use. What this means is that users can decide to put a hold on whatever premiums they’re subscribed to whenever it’s not in use and continue whenever they want. In other words, if you insure a vehicle and you stop using it, you can decide to halt the service and continue with it when the vehicle is back in use. This way, people don’t pay for what they don’t use. In a statement that it released the company said that users “…can get a final insurance quote for their home, its contents, their standalone items or their car in less than 90 seconds, and switch or pause their cover, all online, without speaking to a contact center agent.”

Alex Thomson, one of the startup’s founders said that the company aims to build a service that will be transparent, convenient and, at the same time affordable and accessible. “This is just the start of our journey to reinvent insurance. We are excited to have an investor of Naspers Foundry’s caliber on board to work with us as we expand our team, continue to invest in the technology that puts customers in control, meet the insurance needs of a growing portion of the SA market and enter into international markets”, he said.

While talking about its investment in the insurance startup, Fabian Whate; the Head of Naspers Foundry said that “this fits in with our focus on backing purpose-driven technology businesses. Investing in Naked is consistent with the portfolio we’ve built to date, and Naspers Foundry’s healthy pipeline of potential future investments.”