Technology Transfigures Insurance Landscape by Improving Self-Buying Experience
Before online distribution of insurance came into picture, insurers heavily relied on traditional channels of distribution. This extended limited option to consumers at the time of buying insurance policy owing to lack of comparative data. Online distribution system bridged this gap by providing customers with relevant information and helped them make smarter insurance choice based on their individual and family requirements. Today, consumers are no longer dependent on insurance agents and consultants and instead, do their own research before making insurance purchase. Moreover, IRDAI’s decision of allowing insurance repository facilities to store policies (including life, health and general) electronically under a single e-account number; has eased cumbersome procedure of maintaining multiple files and documents or run in different directions to seek policy details at the time of filing claims.
Social media platforms such as Facebook and Twitter play a significant role in increasing sales through online platform. Most of these platforms are linked to insurer’s webpage wherein consumers can learn about specific product or service in detail and also engage with other customers before making purchase. The emergence of mobile wallet and payment solutions has made consumer’s life simpler. Although, majority of people still prefer to make cash or online payment for their purchases, we have been witnessing a spike in consumer curiosity around mobile payments because of ease of transacting through this platform. The USP of mobile wallet lies in the fact that it does not require you to share critical information regarding your bank account and card number before making the payment (vis-à-vis making payment through credit or debit card).
I believe big data and cloud services would continue to push banking and insurance industry to the next level. Big data allows banking and insurance industry to analyze customer’s purchasing habits on the basis of their previous purchases, new searches, age, gender, income and assets etc. This helps them predict customer’s behavior and potential requirements; and offer relevant products accordingly. Cloud services help financial industry scale up their business by reducing costs. Moreover, it improves the operational efficiency by reducing complexities associated with managing mountain of existing as well as future data.
As consumers move away from buying products using traditional channels, I expect competition within this segment to further intensify and would push insurers to launch innovative products at competitive pricing, thereby benefiting consumers at large. Moreover, online distribution system will play major role in expanding the penetration of insurance in India.