Digit is Busting Complexity in Insurance With Technology Through Digit Insurance, Kamesh Goyal wants to simplify the insurance customer's journey, right from picking products, to policy issuance to claim processes

Having worked in the insurance industry for 30 years, Kamesh Goyal exactly knows the challenges facing it—confusion created by jargon-heavy terms and conditions and the resulant mistrust of the industry.

"Insurance is supposed to be a trust-based system where one is assured help during difficult times," says the Chairman, Goyal. "In a country like India where insurance penetration is low, I understood where exactly the challenge and opportunity lay."

Digit Insurance, one of the first fully cloud-based insurance firms in India, came about in 2016 with Goyal wanting to "make insurance simple' through technology. The core idea was to simplify the customer's journey and provide them with a seamless experience, right from picking products, to policy issuance to claim processes, as per Goyal.

The full-stack insurtech startup powered by Artificial Intelligence (AI), Machine Learning (ML), image analytics, tracking technologies and data lakes, builds general insurance products, such as motor, health, travel and home insurance, among others.

The two-year old company has served 6.9 million customers till date, underwritten premiums worth INR 2,200 crore and processed over 2 lakh claims. It claims to have gained 1.2 per cent market share of the overall Indian Insurance sector within two years of operations.

Goyal also counts its Net Promoter Score (NPS)—a service quality metric—of over 80 an achievement for the company. The highest NPS score among the major private sector insurers is 70.3 (of ICICI Lombard GIC) in motor insurance category, 62.1 (of Bajaj Allianz) in life insurance and 76.7 (of Apollo Munich) in health insurance, as per Numr Research's Insurance NPS 2019 survey.

End-to-end Tech Solutions—Products, Documents and Claims

Digit integrates technology-enabled processes across distribution, buying and claims processing.

"The use of ML, AI and image analytics help us in faster fraud management and claims settlement," says Goyal. For instance, in the case of bike insurance AI-based technology solutions recognise basic checks like bike registration number, the colour of the bike, etc, which not only speeds up the process of inspection but also of policy issuance.

Similarly, travel insurance policies make use of real-time flight tracking to proactively register a claim in case of a delay. "We provide a three-step, 100 per cent automated claims process for our flight-delay product," explains Goyal. "If a flight is delayed beyond 75 minutes, we track it, send the customers an SMS asking for their boarding pass and bank details and process the claim." In contrast to the industry standard of offering a claim only when the customer's flight is delayed for over six hours, Digit claims to offer insurance payout for 75 minutes of delay.

The company also offers an audio claim feature that eliminates the need for the insured to fill long applications. The customer calls to register a claim, which is taped and transcribed to extract and store details for processing the claim.

On the business side of the things, the all-digital model has reduced the company's infrastructure and operational costs, as per Goyal. Though Goyal refused to reveal the numbers, a June 2019 report on insurance sector by PricewaterhouseCoopers (PwC) shows that digitisation can reduce around 20–30 per cent of the cost of non-life insurance products and 15–20 per cent of the cost of life insurance.

Digit's technology-focused model has garnered sizeable investor interest since the company's inception. Indo-Canadian business tycoon Prem Watsa, who is chairman and founder of Fairfax Financials Holdings, pumped INR 350 crore into the company in return of 45 per cent stake even before Digit rolled out its operation in November 2017 on getting the regulatory nod. Later, Fairfax invested USD 44 million seed amount in Digit, followed by more in subsequent rounds.

The Bengaluru-based startup has raised cumulative USD 224 million in funding so far from A91 Partners, Faering Capital and TVS Capital, apart from Fairfax.

Empowering Partner Companies with API-based Solutions

Not just customers, Digit aspires to simplify the journey of its partner companies as well. It's application program interface (API) based solutions allows partner companies, which includes insurance aggregator Policybazaar, Flipkart, ClearTrip and Axis Bank, among others, to cancel or make amendments to the policy.

"We have built a cloud based interface with our partners especially for endorsements and cancellation. When partner companies need to make changes to the policy documents or cancel a policy, they do not need write us email asking for the changes. Instead, they can select the data fields that need to be changed, upload the relevant documents on the portal and the request is processed via a bot," Goyal explains.

In the coming months, Digit wants to devise tech solutions to empower Small and Medium Enterprises (SMEs) by offering them zero touch processes, both for claims and policy issuance.