An InsurTech revolution is underway in India
Blog: NASSCOM Official Blog
- A gradual shift from ‘Push’ to ‘Pull’: Consumers in the metros and tier 1 cities are becoming habitual buyers of Insurance and are getting comfortable in buying Insurance without much assistance. Consumers are actively learning how to compare and buy Insurance products on e-platforms and tightening compliance about buying motor Insurance is bringing more consumers under the Insurance umbrella
- Growing consumer expectations being addressed through digital: Customers now expect on-tap service and a seamless experience from purchase to claims to renewal. PGA Labs estimates that the number of internet users in India will be 800M by 2023 and most of them will be connected via their smartphones. As insurers are becoming more digital and getting closer to the point of sales in the offline world, penetration of Insurance is set to increase
- Growing ‘preservation mindset’: Consumers are increasingly getting more conscious of preserving and extending the life of their assets, be it their home, expensive phones, automobiles, and consumer appliances
- Lower cost of distribution and servicing: Insurers are leveraging technology to assess the condition of the underlying asset, enable the raising of claims, do a remote inspection for minor injuries or damages and deliver a seamless customer experience. Most of these services were dependent on agents, field team or third party agencies earlier and needed extensive coordination at the insurer’s end driving costs up. InsurTech startups are processing millions of customer conversations to create Artificial Intelligence and Natural Language Processing powered Chatbots that are fast being deployed on front lines of support. These Chatbots can auto-respond to claim related queries, FAQs, can help in product discovery and are designed to be easily integrated on the website via APIs. Even offline agents and brokers are being enabled digitally
- Capital backing internet first insurers: Internet-first Insurance platforms have raised US$ 2.2B globally in 2018. Like in the USA and Europe, internet-first insurance platforms have received US$ 734M in funding to date, as per PGA Labs research
- New Innovative Products: Seamless connectivity and micro-payments are enabling new Insurance use cases. For example, InsurTech players have started to give the option to commuters to insure their rides on a cab to cover loss of property and damage aligned to changing commuting trends in India. Also, the sachet approach followed by health insurers to offer Insurance cover for specific instances such as seasonal diseases like Dengue has allowed some tech-players to sell Insurance through tie-ups with traditional Insurance firms. Even incumbent insurers are offering bite-sized per-day and per-week Insurance for domestic travel trips
- Superior underwriting: From leveraging telematics to social score in underwriting, new age InsurTech companies are preparing to provide customized and economical Insurance products. Other countries have started tracking driver performance, are tracking wellness through fitness trackers, coming up with Pay-As-You-Drive Insurance based on an individual’s driving habits to name a few. These companies collect various data points from driver behavior, health, performance, geo-location for Motor Insurance or a person’s social media behavior, connections, affiliates to underwrite the risk more accurately for the insured individual
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