The venture, Kiwi General Insurance-promoted by WestBridge and Garg in a 70:30 equity structure, has received regulatory approval and plans to build an AI-led insurer where technology is embedded not just in distribution but also across underwriting, claims, fraud detection and customer servicing.
Unlike most insurers that have focused on digitising existing processes, the company is attempting to redesign them from scratch using a policy administration system (PAS) architecture that will eliminate repetitive paperwork and manual interventions.
“The insurance industry spends 80-90% of its time on transactions rather than developing new markets,” Garg told ET in an interview, arguing that processes such as policy endorsements, renewals, claims documentation and reconciliation consume disproportionate time and resources.
The insurer has been launched with initial capital of Rs 150 crore and plans to infuse another Rs 500 crore this year. Backed by WestBridge, which Garg described as a long-term shareholder rather than a financial investor, the company is targeting gross written premium of around Rs 5,000 crore within five years.
The company’s strategy is to bring that transaction burden closer to the 5-10% levels seen in the mutual fund industry, where account-based servicing has largely replaced paper intensive processes.
The startup plans to begin with motor insurance, the traditional entry point for new insurers because of lower barriers to customer acquisition and price sensitive demand. But the bigger ambition lies elsewhere.Garg sees significant untapped opportunities in segments such as home insurance, renter’s insurance, OPD coverage, liability products and other niche lines that remain underdeveloped despite rising income levels.
The company believes AI can help it build one of the industry’s leanest operating models by automating routine tasks that are typically handled by employees, improving productivity while keeping costs low. The technology will also be deployed to strengthen fraud detection and accelerate claims settlement.
One of the ideas under development is a real-time claims payment system under which garages could be paid directly, reducing customer involvement in the reimbursement process. The company is also in discussions with automobile manufacturers and dealer networks for future integrations.
Unlike incumbent insurers that carry decades of legacy systems and processes, Garg says the startup’s biggest advantage is starting with a clean slate.
“We don’t have any legacy. Either having no legacy can become a disadvantage or an advantage. We are trying to convert it into an advantage,” he said.