Tax office audit insurtech AuditCover has raised $1.7 million in a Seed 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 business Greenlight Re.
Founder and CEO Gil Snir has built AuditCover as an insurance distribution platform that combines the fundamentals of tax audit insurance with rapid data ingestion and modelling software to cover taxpayers for their professional fees when faced with an audit.
He identified tax audit insurance as a category of general insurance that sat largely unchanged for more than 20 years at a time when compliance, technology and the new price modelling capabilities are converging.
“Both tax and insurance are highly regulated and complex areas. Our mission is to remove the ambiguity and protect taxpayers from the growing risk of an audit, enquiry or review,” he said.
“We’re living in an era where the tax office has edged far ahead of the average tax payer in terms of data and technology capability. We think it’s time to even up the playing field”
The startup recently secured insurance capacity from HDI Global Specialty SE’s branch in Australia to roll out its product nationally.
“HDI are the perfect insurance partner to support our vision. They are an innovative global player with a track record for launching dynamic insurance solutions in market,” Snir said.
Since launching their new tax audit insurance solution in February 2022, AuditCover has engaged hundreds of accounting practices 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 an AuditCover director.
Plater said tax audit insurance is ripe for innovation.
“The nation has experienced a COVID-19 induced hiatus from tax compliance activity as the ATO gave businesses a well-needed break,” she said.
“That time has come to an end. The federal government will be seeking to recover the deficit created by COVID-19 and natural disaster spending. At the same time, taxpayer affairs are increasingly becoming more complex”