Online insurance start-up OneDegree raises HK$200 million to fund push to cover Hong Kong’s dogs and cats

Home-grown online pet insurer OneDegree has raised HK$200 million (US$25.5 million) from a number of investors to finance its plan to offer insurance cover to more than half a million dogs and cats in Hong Kong.

The company co-founded by former JPMorgan banker Alvin Kwock Yin-lun in 2016 is among the first batch of purely online insurers applying for a licence via the Insurance Authority’s fast-track scheme. It plans to offer a range of general insurance products, with a focus on medical insurance cover for the 510,000 cats and dogs in Hong Kong.

With the licence application in the final stages, Kwock has raised HK$100 million from Series A funding. And the investors have committed to provide an additional HK$100 million after the licence is granted. It is the biggest amount raised to date by a pre-revenue insurance start-up in Hong Kong.

“The funds raised are to meet the capital requirements of the insurance licence as well as for our technology investment and other business development,” Kwock said in an interview.

The Insurance Authority requires general insurers to have at least HK$10 million of capital, but can set the bar higher in cases where an applicant is generating higher premiums. In the case of OneDegree, the regulator set the level 10 times higher than the minimum requirement, which is why the company needed to raise HK$100 million in funding.

“When the premium size gets bigger, so does the capital requirement. That is why we got early commitments from investors to give us continual financial support,” Kwock said.