Money & Banking

Online sales of non-life insurance policies rising

Mumbai | Updated on January 24, 2011 Published on January 24, 2011

Customers are increasingly buying and renewing non-life insurance policies merely by the click of a mouse, bypassing agents.

Motor, travel and health insurance policies are increasingly being sold online as it is convenient and cheaper for both the customer and the insurance company. With the insurance regulator also planning to soon introduce demat accounts for insurance policies, online sales are expected to become the norm, going ahead.

Mr Kartik Jain, Head Marketing and Direct at ICICI Lombard General Insurance said online sales for the company have been growing in double digits, with travel being sold the most through this channel.

“If the renewals are also added, then the share of travel, health and motor is almost equal in online sales,” he said.

For ICICI Lombard, the share of the online channel is around 5 per cent of the total sales.

Mr Satkam Divya, Business Head, Rupeetalk.com, a financial products portal, said, “Going forward sales of general insurance will completely be online because it is more convenient for the customer. For the company it will bring down distribution costs.

“There is increasing trend of online sales of motor, travel and health insurance, where no health check-ups are required.

“More renewals will happen online as all the details are already with the company and the customer only has to renew it. In fact, online renewal is growing at a faster pace.”

“We have started selling travel insurance online. We are planning to allow renewal of motor and health insurance policies online by next fiscal. Selling policies online will help save commission costs paid to distributors. Customers will also get policies cheaper online,” said Mr Sushil Rawat, Chief Marketing Officer of Universal Sompo General Insurance.

Inventives

To incentivise customers, companies are giving discounts to customers who choose to renew policies online. “We give a discount of 2.5 per cent to our customers for renewal of motor insurance policies online,” said Mr Jain.

Insurance company officials say online sales will get a major push once IRDA permits demat accounts for insurance policies.

Currently, online sales are not 100 per cent online except for travel insurance. Even if a policy is bought online, one still has to download the form, sign the document and then mail it to the insurance company.

“Once IRDA starts issuing an insurance account number, customers will get more used to holding an insurance policy in a soft copy.

Currently, they are not comfortable with not having a policy in paper form,” said an insurance company official.

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Published on January 24, 2011
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