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Go Beyond Life, Health Policies

Go Beyond Life, Health Policies

Product innovation will gain traction as the industry Gets set to go on a digital overdrive

Illustration by Raj Verma Illustration by Raj Verma

Product innovations and the urge to protect families in case of eventualities arising out of Covid-19 drove people to buy insurance in 2020. Most life and health insurance products saw demand directly coming in from customers.

But the fact is the insurance industry was already on the innovation drive pre-Covid. Just in January, the Insurance Regulatory and Development Authority of India (IRDAI) had approved a number of sandbox products targeted at making insurance cost-effective and more relevant for customers. "Some of the products that gained significant traction include Edelweiss General Insurance's Edelweiss SWITCH, Bharti AXA General Insurances Pay-As-You-Drive, ICICI PruLife Insurance Outpatient Health cover and Go Digit General Insurance Network-based Accidental Insurance for Rented Motor Vehicle," says Vaidyanathan Ramani, Head, Product and Innovation, Policybazaar.com.

Single owner-multiple vehicles product from ICICI Lombard General Insurance was another popular one. Amid the lockdown, as people refrained from driving, sandbox products, including Pay As You Use and Pay How You Use made a timely entry. Sandbox products are those with features not permitted under the existing regulatory framework. IRDAI had put a limit of 10,000 customers or Rs 50-lakh premium on such products. Now that the limits have been met, insurers are awaiting clarity from the regulator on how to take these products forward, says Sanjay Datta, Chief of Underwriting, Reinsurance and Claims, ICICI Lombard General Insurance.

In March, the regulator directed insurers to include Covid-19 in all their policies. Pandemics were earlier exempt. Further, the launch of standardised Corona Kavach and Corona Rakshak policies helped lower-income families access Covid cover at low cost.

Underwriting rules and customer services also underwent a sea change. "There are now virtual surveys for claim intimation. The usage of tele-consultation has increased multi-fold. WhatsApp, email and chat have now become the norm for responding to consumer queries. Some organisations are leveraging Bots for consumer engagement," says Datta of ICICI Lombard. In some cases, e-KYC was used for issuing new policies.

Coming Up

This digital engagement will be scaled up further through artificial intelligence (AI), machine learning (ML), blockchain, Big Data and advanced analytics. "The industry will move towards product simplification using data science while drawing on a broader range of insight and data, to provide more bespoke products that meet individual needs. Offering personalised experiences will emerge as a differentiator. Digital enablers will further improve efficiencies, productivity and lead to cost control," says Kamlesh Rao, MD and CEO, Aditya Birla Sun Life Insurance (ABSLI).

Product experimentation will continue as well. According to Naveen Tahilyani, MD and CEO, Tata AIA Life Insurance, life and health covers will be in focus.

The year 2020 also saw some unique offerings from consumers such as outpatient department cover, home-based care, cyber liability and pet insurance. Industry-wide launches by other insurers are expected in 2021.

Going forward, says Anand Roy, MD, Star Health and Allied Insurance, seamless digital-led processes for settlement of claims and customer services and more focus on customer centricity and value-added services such as tele-medicine and wellness will see faster adoption.

Options Ahead

There are a number of insurance products available at fairly low cost that a customer should consider. People normally don't see value in products such as fire, home and cyber insurance. In motor insurance, too, people end up buying the mandatory third-party cover and do not take into consideration the own damage cover.

At a time when most services are going digital, there is a need for cyber insurance. ICICI Lombard, HDFC Ergo and Bajaj Allianz already offer it. Home insurance includes structure and contents of your house.

Then there are byte-sized insurance products such as backpack, marathon and trip insurance etc that you can buy from companies such as Toffee Insurance, Digit Insurance, Acko Insurance, Symbo Insurance or Mobikwik. Many companies also provide insurance on gadgets or home appliances during the time of purchase. Besides, you can also buy credit and mortgage insurance in which the insurance company keeps paying EMIs on your behalf in case you meet with an accident or you are no longer around.

Finally, awareness holds key to buying insurance products. The amount of coverage you need, the premium payment option you choose or what your policy does or does not cover are some important aspects to consider before filling up the insurance proposal form.

@apri_sharma