How This Insurance Company Rose Up the Ranks Riding the Digital Wave
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From an era of transactions on paper and agents walking door-to-door to the method of selling insurance today — the entire process being done at the click of a button on your computer or phone — the industry has undergone a radical transformation. Thanks to technology.
However, the market penetration numbers are still low, which allows insurance companies to take charge and ride on the digital wave to reach out to the farthest corners of the country.
A company that has been able to harness the potential of the industry is IndiaFirst Life Insurance. The company is the outcome of a joint-venture between Bank of Baroda, Andhra Bank and UK’s Life Insurance and Pension Fund Legal & General. About eight years into the business, they have already climbed up the ladder to secure the 12th position in the ranking of insurance companies in India.
Entrepreneur India caught up RM Vishakha, MD and CEO of IndiaFirst Life Insurance to learn about how they have taken the digitally-enabled path for their 94 lakh customers.
The Need for Insurance is Higher Now
The Indian insurance industry has, for long, been trying to crack the code of reaching out to millions of Indian customers while struggling with low penetration numbers. However, today the story has a different ending with more and more customers looking at buying insurance policies.
Vishakha believes that the reason is the change in socio demographic profiles of Indian citizens. Earlier, there were guaranteed jobs where often in the case of government jobs, the death of a government official meant a compensatory job for a family member. “Back then, the risk factor was taken care of for many families,” said Vishakha and added, “With more and more nuclear families popping up these and the privatization of the economy, the risk is higher and that’s where the requirement for insurance comes in.”
Riding the Digital Wave
Given the advent of technology, Insurtech has been able to win over more customers, thanks to greater reach through the tap of a button. Foregoing the long delusion that insurance means a lot of papers and documents along with umpteen number of back and forth with the agent, today insurance policies are given to a customer at the comfort of their home with an all digital approach.
At IndiaFirst too, all their processes have gone digital. “All our tools and sales processes are available online. Through our digital initiatives, we aim to do right consumer profiling and usage of products while also creating financial awareness,” she said.
Flexibility for Better Customer Service
With the launch of a first-of-its-kind product — Insurance Khata – IndiaFirst has tied up with Common Service Centres (CSCs are centres for delivering government of India e-Services to remote locations where internet availability is negligible or mostly absent). Keeping in mind the seasonal incomes of people, their product works literally like a Khata allowing individuals the flexibility to pay premium in parts, as and when possible. “This product is designed for long-term savings along with the life insurance benefit, making it a win-win proposition for the customers. The simple and easy way to understand model makes this product mis-selling resilient,” said Vishakha.
The Future of Insurance
There’s no denying the speedy growth of insurance in India and technology is being incorporated to act as a catalyst. With a customer- centric approach, Vishakha said future forecasts aside, they are aggressively planning their growth strategies. Targeting the informal sector with their recent product, they aim to reach out to the 20 crore base of Aadhaar. They are also looking at partnering with start-ups for pilot projects.
Another recent development in the insurance industry has been with companies turning IPOs. Ask Vishakha whether they too plan an IPO and she said, “These companies have been around for almost 17 years now. IPO requires a certain stage of evolution of the company. The requirement of an IPO is an individual call that has to be taken by the shareholders.”