Indian insurers are projected to collect about Rs 427 crore of premium through the online channel in this fiscal, said R K Nair, member, finance and investment, Insurance Regulatory and Development Authority (Irda). Speaking at the ISACA India Conference 2014, Nair said with the number of internet users growing, the thrust is to address specific customer needs through technology. ISACA is a non-profit, independent association that advocates for professionals involved in information security, assurance, risk management and governance.
“With about 95 per cent mobile users keeping their device within the arm’s length, this provides a huge opportunity to insurance companies since a lot of people are still excluded from the insurance bracket,” said Nair.
A survey by Max Life Insurance and Nielsen had said that life insurance has been ranked as the most popular financial product to be bought online. In a survey across metros and smaller cities, it was found that life insurance was only below clothes/apparel and accessories in online purchases. Motor insurance, one of the popular insurance products bought online, also came much below life insurance on the list of products that people were willing to buy online.
There are some concerns about information technology too, as pointed out by Nair. He explained that apart from some concerns about data governance and high IT spends by insurers, Nair said that all insurers should adopt newer technology as soon as possible. About three out of every four insurance policies sold by 2020 would be influenced by digital channels during either the pre-purchase stage, purchase or renewal stages, according to a new report by Boston Consulting Group(BCG) and Google India. This report, Digital@Insurance-20X By 2020, said that not only will insurance sales from online channels grow 20 times from today by 2020, but overall internet influenced sales would be Rs 3-4 lakh crore.
The study said that the old ways of selling insurance are, over time becoming less sustainable. Traditional business models are being challenged by the emergence of trends such as lesser relevance of physical footprint, mobile internet, analytics, social platforms and disruptive players.