During the Corona period, there has been an increase in awareness among people about buying an insurance policy. But they are more like the option of avoiding the complicated and lengthy process associated with buying and claiming insurance plans. Insurance technology companies are helping them in this.
The increasing inclination towards technology, changing customer needs and increasing competition in the field of financial services have increased the number and market share of financial platforms attracting the youth.
The market share of private companies in the general and health insurance segment has increased from 47.97% in FY19 to 48.03 percent in FY2020. Their share in life insurance related services stands at 33.78%.
What are differentiating insurtech companies
The main reason for the growth of technology-oriented companies in the world of insurance is that today’s smartphone generation needs everything in an easy way. Keeping this in mind, insurance technology companies are bringing changes in services.
Vivek Chaturvedi, CMO, Digit Insurance says, “We have simplified the entire process from document preparation to passing on the benefits of insurance to the customer. We present the terms and conditions related to insurance in two pages, so that the customer does not take time to know all the aspects.
The insurance companies which are offering to make things easy and convenient are also adopting unique ways. Chaturvedi said, “Companies are looking for different technological avenues. It can be understood that while booking flight tickets, the facility of purchasing insurance with the same is given because the customer likes it. With this, they avoid the frills of insuring their journey separately by going to any other platform.
With easy access to facilities, it also attracts customers to get customized insurance, which includes things according to their needs. Chaturvedi says that the smartphone generation believes in being self-reliant. This is the reason why the trend of DIY is increasing. Insurtech companies are understanding that one type of policy does not fit for everyone. Giving customers the option to customize the policy according to their own.
With such services, the work of not only the customers but also the companies is getting easier. The facility of making insurance claims through a smartphone app also does not make the process long and tedious for them.
Chaturvedi gives an example, “At motor insurance, we have started a DIY pre-inspection application. This eliminates the need for manual inspection. The process which earlier used to take about 24 hours, is now completed in 10 minutes. You just have to put a photo on the app. They come on our own in our system.
Now it’s Blockchain Insurance’s turn?
Taking technology to the next level, the industry is adopting AI (Artificial Intelligence) based underwriting, claim filing methods. Experts believe that the next focus could be on blockchain contracts. In this, the need to file claims on behalf of the customers will be eliminated. Bajaj Allianz General Insurance has introduced one such travel insurance, which automatically settles claims with the help of blockchain in case of flight delays.
Companies preparing to reach this level have expanded this market. India is the second largest market for insurtech in Asia-Pacific. According to data from S&P Global Market Intelligence, India accounts for 35 percent of the $3.66 billion coming into the sector.
S&P says that big technology companies are trying to capitalize on this market. At the same time, established firms providing insurance services are also engaged in creating their own digital channels. The startups who will help them in this transition will increase their sway in the segment.