The Hindu Business Line : Pay your insurance premiums now through SMS

New Delhi, Oct. 9 Worried about forgetting the due date of your life insurance premium or having to waste time standing in line to renew it? Life insurers are addressing this issue by introducing alternative modes of payment.

According to industry estimates, around 25 per cent of the policies each year lapse due to non-payment of premiums on time.

While most of the companies in the life insurance business offer online payment service or electronic clearance services, ING Vysya Life Insurance and Max New York Life (MNYL) have gone a step ahead. Both companies have launched premium pay service through SMS, and the latter has also tied up with two banks to offer premium pay services through ATMs.

“With these alternative payment facilities, customers can pay their premiums in an easy, efficient and secure manner, which would also ensure that the policy does not lapse ,” Mr Sanjeev Mago, Vice-President (Operations), Max New York Life, told Business Line.

Tie-up with banks

According to him, new business and renewal income account for 90-95 per cent of the revenues for insurers. “At this point of time, around 60 per cent of our income comes from new businesses and the rest from renewal income. And we expect this to be half and half in the near future. Since our customer size is also increasing, the aspect of renewals is being given top priority. So, to expand our payment options, we have started these services,” he added.

MNYL has tied up with Bill Desk, a service that will integrate it with the banks. It tied up with 18 banks for providing the online payment option.

Customers can register for the service by completing the registration form of electronic payment with the partner bank.

Mobile alerts

Both ING Vysya and MNYL have similar means of enabling payments through SMS. “Customers receive a premium alert through an SMS, specifying the due amount and the due date of the renewal premium. The customers can then issue payment instructions by sending an SMS to a specified short code provided in the message they get,” Mr Mago said.

According to Mr Rahul Agarwal, Vice-President, Customer Services, ING Vysya Life: “With the increasing penetration of cell phones, mobile commerce is set for tremendous growth over the coming years .”

For payment through ATMs, MNYL has tied up with ABN Amro and IDBI Bank.

More Stories on : M-Commerce | Life Insurance

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