A survey by reinsurance major Swiss Re has highlighted that there is an increasing trend among Indian consumers in seeking information and buying insurance digitally, especially through payment apps and e-commerce websites due to heavy usage of such platforms since demonetisation. Insurers’ websites and apps have also become a preferred mode of buying covers for Indian consumers.
However, traditional channels of distribution such as agents, brokers, and insurance aggregators are still the primary channels for insurance-related information searches in India.
Among digital payment apps and e-commerce websites, Indian consumers have ranked GooglePay, followed by PayTM, and Amazon at the top of their preference list as potential platforms to buy insurance from digitally. Walmart owned e-commerce giant Flipkart, and Walmart’s payment app PhonePe are also among the preferred apps for Indian consumers from where they would buy insurance digitally.
The reason cited by respondents in the survey for buying insurance products online is the ease of filing claims and making applications.
The survey conducted by the reinsurance major tested acceptance of six digital life and health insurance products tailored to fit a mobile screen, with small ticket sizes and a few health questions.
“The results found consumers very open to products designed for digital platforms. More than 70 per cent expressed strong intent to purchase all six products we tested. There was no meaningful difference by either gender or income, but younger consumers were in most cases more open than those aged 50 and above. Frequent app users also tended to like the concepts more”, survey results showed.
Among concerns expressed by the respondents in buying insurance products digitally through payment, e-commerce apps, or websites are lack clarity on product terms and conditions and data security.
While the Indian insurance industry has always depended on “touch” to engender trust among its customers but the covid19 pandemic, and the new norm of social distancing, hugely altered the way it functions, prompting insurers to make the leap from manual, paper-bound processes to digital-based selling. Even, the traditional channels of distribution adopted to the changing needs.
Since Indian consumers are showing willingness to buy insurance products through digital platforms, Swiss Re has said, insurers can leverage this opportunity to access new risk pools and consumers.
“We believe full-scale disruption of traditional insurance distribution channels is unlikely since there always will be a proportion of consumers that favour them. Rather, an omni-channel approach with mix of digital and physical touchpoints will best complement each other through cross and up-selling opportunities”, Swiss Re said in its survey report.
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