Tax office audit insurtech AuditCover has raised $1.7 million in a fundraising round led by Hunter Equity Group.
Other strategic investors included local angel investors Ron Lesh of BGL) and Guy Pearson of Ignition, as well as Nasda-listed global reinsurance firm Greenlight Re.
Founder and CEO Gil Snir designed AuditCover as an insurance distribution platform that combines the fundamentals of tax audit insurance with rapid data ingestion and modeling software to cover taxpayers for their fees professionals when faced with an audit.
He identified tax audit insurance as a category of general insurance that has remained virtually unchanged for more than 20 years at a time when compliance, technology and new pricing modeling capabilities are converging.
“Taxation and insurance are highly regulated and complex areas. Our mission is to disambiguate and protect taxpayers from the growing risk of an audit, investigation or review,” he said.
“We live in a time when the tax office has far outstripped the average taxpayer in terms of data capacity and technology. We think it’s time to level the playing field.”
The startup recently secured insurance capability from HDI Global Specialty SE’s Australia branch to roll out its product nationwide.
“HDI is the ideal insurance partner to support our vision. It is an innovative global player with a proven track record of bringing dynamic insurance solutions to market,” Snir said.
Since launching its new tax audit assurance solution in February 2022, AuditCover has engaged hundreds of accounting firms as distribution partners.
As part of the raise, financial services legal expert Claire Wivell Plater, who also sits on the boards of Youi Insurance and Athena Home Loans, has signed on as director of AuditCover.
Tackle said tax audit insurance is ripe for innovation.
“The nation has seen a COVID-19-induced disruption to tax compliance activity as the ATO has given businesses a much-needed break,” she said.
“That time is over. The federal government will seek to recover the deficit created by COVID-19 and expenditures related to natural disasters. At the same time, taxpayers’ affairs are becoming increasingly complex.