Despite 2X jump in revenue, Coverfox losses rose to Rs 33.7 Cr in FY18
Online insurance broker Coverfox, which recently raised its Series C round, has reported its financial reports for FY18.
The Varun Dua and Devendra Rane founded company has clocked a revenue of Rs 12.42 crore in FY18, almost twice the figure of Rs 6.12 crore in FY17. Commission income contributed 97.5 per cent (Rs 11.25 crore) to this figure by recording a 2.7X jump from Rs 4.2 crore in the previous fiscal.
HDFC Ergo General Insurance attracts the largest traction over the platform, counting for commission revenue worth Rs 3.01 crore (24.2 per cent of the overall figure), followed by Oriental Insurance generating Rs 1.86 crore (15 per cent) income.
The company incurred expenses worth Rs 46.15 crore, showing an increase of 21.5 per cent from Rs 37.98 crore in FY17. It spent the largest amount on its advertisement expenses – Rs 21.54 crore, a little lesser than Rs 22.02 crore in the previous financial year.
In retrospect, to earn a single rupee, the company spent Rs 1.7 on advertisement in the latest reported fiscal.
Consequently, the company suffered a 6 per cent increase in losses, up from Rs 31.86 crore to Rs 33.74 crore in the latest fiscal.
As a part of its funding round the company picked up Rs 96 crore ($15 million) from Transamerica and others in June 2017, and by the end of FY18, it had raised its Series C round worth $22 million led by IFC and Transamerica.
Overall, while the company’s performance reflects top line growth, the advertisement expense being higher than the revenue itself, and the inability to control losses reflects a tremendous scope for improvement, especially with competitors like SoftBank-backed PolicyBazaar in the market.