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Etap, A Nigerian Startup, Receives $1.5 Million Pre-Seed To Make Car Insurance More Accessible
Only 21% of Nigeria’s 12 million registered vehicles have valid motor insurance, while the rest have false certificates (of which most owners are ignorant) or are not protected at all.
According to the research, a number of automobile owners who have legitimate insurance policies neglect to renew them when they expire, in violation of Nigerian law, which requires that every vehicle be insured. All of these issues come from the fact that the majority of transactions in the sector are still done manually and, in many cases, through intermediaries, exacerbating the issues.
Etap founder and CEO Ibraheem Babalola / Etap
Insurtechs like Etap have developed in Nigeria and across Africa in recent years to fill the void by making the process of obtaining insurance and filing claims easier. Etap claims to be able to help drivers buy insurance in 90 seconds and file claims in three minutes.
Following a $1.5 million pre-seed round led by Mobility 54, Toyota Tsusho’s venture capital arm, and CFAO Group, the startup is now expanding across the West African country.
“We have fantastic value propositions and great products.” However, we recognize that the products and value offer may be improved, which is why we sought out the current partners. Our goal is to have the most popular insurance products in Africa, and to expand and scale this across the continent. Ibraheem Babalola, founder and CEO of Etap, told TechCrunch, “I feel that we are perfectly positioned to achieve it.”
The investment included Tangerine Insurance (also Etap’s underwriter), Graph Ventures, Newmont, and a number of additional angel investors.
“Nigeria has one of the highest risk environments in the world and an insurance penetration of less than 2% — that relationship is crazy because the higher the risk the more the propensity to want to protect yourself against events; but in Nigeria and the rest of Africa, this is not the case. This needs to change,” said Babalola.
He added that, “Having all these experiences from being on the two sides; being a customer and close to the operator, and experience in building startups; I thought it’s important to reimagine insurance — to reimagine the offering, how people access it, user experience — to make it more flexible, and transparency — by building trust and giving people more value.”
