Life insurance companies offer online policy management
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Life insurance firms offering policies online

The insurance industry is getting digitally savvy giving policyholders the comfort of buying and managing their policy and that too at lower costs.

  • New Delhi,  August 21, 2015  
  • |  
  • UPDATED   09:02 IST
Life insurance companies offer online policy management
(Pic for representation purpose only. Source: Mail Today)

The insurance industry is getting digitally savvy giving policyholders the comfort of buying and managing their policy from the comforts of their homes.

According to a study for India by BCG's Center for Customer Insight, one in two urban Indian Internet users acknowledges 'digital influence' in their overall purchase basket. Sharing the experience of ICICI Prudential Life, executive director Sandeep Batra says, "The digital platform plays a significant role in our business as 93 per cent of our new business applications are initiated using the online platform and 50 per cent of our renewal payments happen via the website or electronically. Further, 69 per cent of our service transactions are processed through the website, SMS or IVRS and 92 per cent payouts happen via the electronic mode."


Here is how life insurance companies are adapting to online rather quickly.

BUY ONLINE

Online plans are much cheaper compared to policies bought through an agent. They are cheaper by 50-60 per cent when bought online as no commission has to be paid to agents. Similarly, Unit-Linked Insurance Plans (Ulips) have become very cost-effective after 2010. The costs got capped following which commission rates reduced significantly. For instance, if a 30-year-old male invests Rs 50,000 every year in an online Ulip, he will have around Rs 13 lakh in 15 years assuming eight-per cent return.

Even after taking into account the rise in mortality charges as one grows old, the cost per annum is 1.29 per cent. If he invests the same money in a five-star rated large- and midcap fund, he will receive around Rs 11 lakh in 15 years (at eight per cent). The average expense ratio of top mutual funds is roughly 2.6 per cent.

POLICY DIGITISATION

Here are some of the reasons why you should store your life insurance policy digitally.

Safety: There is no risk of loss or damage of a policy as may happen with paper policies; the electronic form ensures that the policies are in safe custody and can be easily accessed when needed.

Convenience: All insurance policies, be it life, pension, health or general, can be electronically held under a single account. The details of your life insurance policy can be accessed at any time by logging on to the online portal of Repository.

Single point of service:
All service requests in respect of digital policies can be submitted at any of repository's service points. You can also apply for digital policies at the time of buying the policy.

Less paper work:
When you want to buy a new electronic insurance policy under an existing account, you don't need to go through KYC verification all over again if there are no changes to your KYC details already recorded in your account.

CLAIM SETTLEMENT

Realising the deep penetration of smart phones, insurance companies are using mobile apps as an additional channel for interaction with their policyholders. Even for a life insurance, the usage of an application are unlimited. For example, claim intimation can become simple. Since policy details are already recorded in the app, individuals will not require to search around for the policy and the customer service number. Moreover, the mobile apps enable policyholders to directly access and modify all the necessary information about their policy like premium due dates, fund values, branch location and network hospitals. Some of the apps also allow policy modification.

Self-service options such as updating of contact details or making a query or complaint are also provided. So, make the most of digital drive to save on your precious time.

(In Association with Mail Today)