South Korea-based digital-only insurance provider Carrot General Insurance has announced the raise of $88.7m through its rights offering.

Hanhwa, SK Telecom, Hyundai Motors, Altos Ventures and Stic Investments established Carrot General Insurance through a joint partnership.

Hanhwa increased its stake to 56.6% from 51.6% by making a fresh investment of $55m in this offering.

Stic Investments, SK Telecom, Altos Ventures and Hyundai Motor Group hold 15%, 10%, 9.9% and 3.5% of stakes, respectively.

The firm’s existing shareholders and T-Map Mobility, a navigation service provider, also participated in the round.

The proceeds will be used by the digital insurer to boost its competitiveness, grow business, and launch new products to the market.

The firm noted that it added 200,000 new customers to its pay-per-mile auto insurance within two years of its launch.

The auto insurance offering leverages Carrot’s proprietary driving data analytics and vehicular/IoT device application.

Concurrently, Carrot General Insurance is working on a pay-how-you-drive (UBI) model, which takes into account risk factors like driver’s behaviour to calculate premiums.

Carrot CEO Paul Jung said: “We are thrilled with the support from our shareholders and pleased to be able to allocate this additional capital. This current round of offering was preplanned from the establishment of the venture, but the contribution size has increased as our shareholders recognized Carrot’s innovation capability and future growth potential.”