Shuidi Secures $230 Million Series D Funding to Advance Insurance Tech Infrastructure

On August 20, at the Waterdrop Insurance Mall 2020 Global Partners Conference, Shen Peng, founder and CEO of Waterdrop Inc., announced that the company had completed a $230 million Series D financing round, co-led by Swiss Re Group and Tencent Holdings, with participation from existing investors including IDG Capital and Dianliang Global Fund. It is understood that Waterdrop Inc. is the first insurtech company in which Swiss Re Group has invested in China.

In 2019, Shuidi Inc. successively completed a Series B financing round of nearly RMB 500 million and a Series C financing round exceeding RMB 1 billion. The company’s latest funding round amounted to USD 230 million, marking the highest financing record globally in the insurtech sector in 2020 to date. Previously, reports indicated that Shuidi Inc.’s latest valuation was between USD 4 billion and USD 6 billion.

Herbert Shan, CEO of Swiss Re’s Asian Reinsurance Business and President of Swiss Re Asia, stated that the company will establish a robust partnership with Shuidi in the future, aiming to jointly contribute to the healthy and stable development of the insurance industry and digital innovation. Zhou Ning, Head of Direct Investments and M&A for Swiss Re Asia, remarked that Shuidi has identified an effective integration point between insurance and the internet. As a leader in the insurtech sector, Shuidi has found a new breakthrough to further popularize insurance coverage. Particularly against the backdrop of the pandemic outbreak, Swiss Re Group has observed the global insurance industry accelerating its adoption of technology and digital solutions. Shuidi has, to some extent, addressed the pain points hindering the development of traditional insurance, thereby creating new catalysts for industry growth.

Yu Haiyang, Managing Director of Tencent Investment, stated that against the backdrop of the rapid development of China’s health insurance industry, Waterdrop has effectively seized market opportunities. It not only meets users’ growing demands but also safeguards tens of millions of families through technological innovation, thereby contributing to the further improvement of the individual health protection system. Tencent will provide long-term support for Waterdrop’s development and help deliver a superior user experience.

Previously, Swiss Re was the world’s largest reinsurer for life and health insurance. In China, it had invested in companies such as New China Life Insurance, Ping An Good Doctor, and China Pacific Insurance. Its investment in Shuidi Inc. represented a strategic move by Swiss Re to explore insurtech in the Chinese market. Tencent has supported Shuidi since its angel round, led its Series A and B financing rounds, and continued to back its Series C and D funding rounds, witnessing Shuidi’s rapid growth from a startup into a leading unicorn in the internet-based insurance protection sector.

"As a leading insurtech platform in China, Shuidi Insurance Mall remains committed to empowering its partners. Yang Guang, General Manager of Shuidi Insurance Mall, stated that the company will invest more than RMB 2 billion over the next three years to strengthen new insurtech infrastructure. 'With the continuous increase in the online penetration of insurance services, new demands are being placed on insurtech infrastructure, which will inevitably drive a new round of upgrades and reconstruction of underlying infrastructure.'"

Yang Guang introduced that Shuidi Insurance Mall currently collaborates with over 60 insurance companies, having accumulated extensive cases and experience in scenario-based marketing, online customer acquisition, risk control, channel expansion, and intelligent services. It has been exporting core capabilities—including services, systems, and AI—to its partners, achieving the “three increases and three decreases” effect: namely, enhanced service capability, improved traffic conversion, and increased premium output, alongside reduced customer acquisition costs, lower operation and maintenance expenses, and decreased manpower investment.

Meanwhile, Yang Guang announced the official upgrade of the Waterdrop Insurance Mall Open Platform to version 2.0. The platform now extends its openness beyond insurance companies to include medical institutions, health management organizations, and other third-party entities, providing comprehensive support in marketing, operations, services, and data. To date, the Waterdrop Insurance Mall Open Platform has established deep collaborations with dozens of insurance companies and over 300 institutions, jointly building a health insurance protection ecosystem.

He also revealed that Shuidi Insurance Marketplace maintained rapid growth in the first half of this year, achieving an annualized written premium of nearly RMB 6 billion. He projected that the platform’s annualized written premium would likely surpass RMB 14 billion this year, representing more than a twofold increase compared to 2019, while net earned premiums were expected to reach RMB 6 billion, marking a 300% growth over 2019.

Shen Peng stated that the new round of financing will further invest in the application of technologies such as AI and big data to business operations, leveraging the internet and technology to provide users with more efficient insurance protection services. The company will also accelerate the exploration of medical services (including online consultations, green channels for critical illness treatment, overseas medical care, emergency rescue, and critical illness nursing) and health services (such as physical examinations, genetic testing, and cancer screening) that can be integrated with health insurance, all centered around user needs, with the aim of building a Chinese version of UnitedHealth Group.

Meanwhile, Shuidi launched a new project several months ago to explore the “insurance + pharmaceuticals” model, tentatively named “Shuidi Good Medicine Pay.” This initiative provides pharmaceutical benefit services to both healthy individuals and those with pre-existing conditions, aiming to leverage commercial insurance to integrate payers and pharmaceutical companies, thereby enabling the general public to access better medications and medical treatments at lower costs.

Data indicates that by 2035, China’s health industry will reach a market size of RMB 100 trillion. Over the next three to five years, Shuidi will evolve into an ecosystem company centered on insurance protection and comprehensive healthcare. Shen Peng stated, “We are fortunate to operate in a market of immense scale. Shuidi will remain committed to being user-centric, providing insurance products and health services that cover the entire process and full lifecycle of our users.”