BY CHARLES ABUEDE
In Nigeria, it is no longer news that only 1 in 5 cars are insured currently as a result of the complexities involved in buying and claiming insurance, which has led to widespread apathy for traditional insurance companies and products, with many car owners opting to go without insurance. And this is even despite the longstanding regulation making car insurance compulsory and the more than 100,000 car accidents reported between January 2019 and December 2021.
This opportunity in the insurance space has seen ETAP, an insurtech startup, offering easier buying of insurance and claim settlement, secure $1.5 million in pre-seed funding to grow its team and drive the adoption of much-needed car insurance across Africa but with Nigeria its starting point.
The funding round was led by Mobility 54, the venture capital arm of Toyota Tsusho and CFAO Group, with participation from Tangerine Insurance, Graph Ventures (invested in Clubhouse), Newmont and other angel investors.
Since the launch of ETAP in November 2021 the startup has always made the process of buying and claiming insurance happen exclusively on a smartphone, enabling a seamless and enjoyable insurance experience for users.
ETAP has insured more than 130,000 individual trips and over 500,000 kilometres in car journeys, which represents more than eight times the total distance of paved roads in Nigeria.
The company uses machine learning to build intelligent risk profiles that determine appropriate premiums for each driver, allowing them to achieve lower premiums by driving safely. Using advanced telematics, the driving experience is gamified to improve driving behaviour and drivers can earn Safe Driving points that can be exchanged for shopping vouchers for the most in-demand retail outlets, fuel, cinema and concert tickets, and other exciting experiences. Also, the drivers on the platform have flexible coverage options, including daily, weekly, monthly, quarterly and annual plans depending on their needs.
Starting in Nigeria, the new funding will support the roll-out of ETAP’s game-changing app, which allows drivers to buy insurance in 90 seconds, complete claims in three minutes or less and get rewarded for good driving and avoiding accidents.
The startup also said it plans to explore other opportunities to deliver much-needed insurance services for car owners in other countries across the continent.
Ibraheem Babalola, founder and chief executive officer, ETAP, said, “Just like any other digital service, we believe Nigerians should be able to buy and claim car insurance without having to ‘call a guy’. We also believe that rewarding good drivers can be a catalyst for better driving and making our roads safer. This is why we have created Africa’s most powerful car insurance app and we are excited to have raised these funds to bring more users on board. Too often, the process of buying and claiming insurance in Africa is so out of touch with the everyday reality of most people but we are changing the game and making the process just as enjoyable as any other experience that consumers access on the mobile phone.”
In a statement the company outlined several benefits that can be derived from the use of the app in the unfortunate event of an accident, adding that users simply need to take a picture of the affected part of the car via the app and the artificial intelligence processes the claim based on previously uploaded images. The app comes with geolocation tags, timestamps and other features to prevent fraudulent claims, as well as crash notification, emergency support and more.
Per the pre-seed funding, Yumi Takagi, project manager, Mobility 54, said, “ETAP is addressing many challenges that impact the automotive experience in Africa and we are excited to support and work with them to bring their innovation to more drivers across the continent. We believe that ETAP will engage with this important role and revolutionise the automotive insurance industry with their powerful technology.”