Money & Banking

Insurers see rising demand for policies on online platforms

Surabhi Mumbai | Updated on August 15, 2018

The proliferation of smartphones and tablets has made it easy for customers to buy insurance policies online   -  grinvalds

Ease and convenience attract customers; innovation and technology are the key focus areas for insurance companies

The online marketplace is no longer just for buying clothes, ordering food and making payments. A large number of Indians are also shopping for insurance policies.

Though the number of insurance policies sold online is still small, online insurance marketplaces and insurers are seeing a lot of interest not just from large towns but also from smaller towns for online policies.

Insurance penetration was at an estimated 3.49 per cent in India in 2016-17, which is much below the global average, and the online space is creating not just awareness but is also helping customers who do not have to depend on agents.

“Customers are using online marketplaces to read up on insurance covers, understand exclusions and make informed choices,” said Rakesh Goyal, Director, Probus Insurance, adding that the company sells nearly 18,000 policies online every month with plans to expand their portfolio of products thanks to high demand.

Ease and convenience

According to Tarun Mathur, Chief Business Officer at PolicyBazaar, just about 7 per cent of all insurance policies sold in the country are through online channels, but the ease, convenience and reach are major attractions.

“Ten years ago, there was no online marketplace for insurance. But people are adopting digital technology in a big way. Insuretech is helping customers buy policies easily, and there is a lot of demand from Tier II and Tier III cities,” he said, adding that the company has introduced video inspection for motor insurance as well as multilingual interface, which is seeing good response.

While motor and travel insurance are the main attractions, insurers point out that people also choose to go online for small-ticket policies for home insurance, and are also now reading up about life products such as term insurance. Insurers are also allowing online documentation for health policies.

Innovation and technology have become key focus areas for insurance companies, according to Nikhil Apte, Chief Product Officer - Product Factory (Health) at Royal Sundaram.

“Almost everyone has a smartphone and internet connection now. In lifeline products, 54 per cent of our new business is from online. Of this, almost 50 per cent comes from Tier II towns,” he said.

“Customers are using both online and offline means. But for online policies, they look for simplicity, trust, simplified underwriting and fast issuances,” said Saba Adil, Chief Operating Officer at online insurance company Aegon Life Insurance, adding that the company sells about 30 per cent of its policies online.

Published on August 15, 2018

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