For a long time, the general insurance sector has operated in a very conventional way in India. The general insurance industry is experiencing a significant transformation that brings new opportunities and challanges. Generic insurance companies in the modern world would do well by preparing themselves adequately for what lies ahead because they are considered vital services offering life protection against eventualities.
General Insurance Explained
General Insurance offers protection from financial loss that can result from unforeseen incidents. It is coverage against disasters like thefts during a particular period, accidents involving properties, and even health care costs. These are examples of some typical forms of General Insurance:
- Motor Insurance: Motor Insurance provides financial protection against vehicle losses and damages caused by accidents, theft, or natural calamities. It covers expenses for repairing or replacing vehicles.
- Health Insurance: Health Insurance is what people turn to when they have medical problems. It helps cover pricey hospital bills in case of injury, minimising financial strain. The policy reimburses costs for surgical operations, ambulance fares, and accommodation, among other things.
- Home Insurance: Home Insurance protects the home and its belongings from damages and losses caused by man-made or natural disasters, such as floods, earthquakes, etc. It also covers the loss of valuables and repairs.
- Travel Insurance: Travel insurance protects you from unforeseen expenses and problems during traveling. It addresses a variety of possible issues, such as medical issues, misplaced luggage, and trip delays and cancellations.
ACKO General Insurance leverages technology to offer customised policies and a hassle-free claim process through apps and dedicated support teams. With innovative products, digital methods, and a focus on customer centric approach, ACKO aims to make insurance simple, flexible, and transparent for policyholders.
Major Tech Trends Transforming the Industry
Some of the significant tech trends that are likely to drive transformation in the Indian general insurance sector are:
1- Increasing Digital Adoption
Customers have rapidly adopted digital services, especially following the COVID-19 pandemic. They now prefer online platforms for insurance tasks, as research, purchase, and servicing insurance policies are now done online. Information technology-operational technology (IT-OT) fabrics are being developed using accelerated data management.
Key digital priorities for insurers include:
Insurers are focusing on digital capabilities to serve customers better and improve operations. Some key priorities include:
- Enabling customers to purchase policies and file claims online with a few clicks makes the process faster and more convenient.
- Developing user-friendly mobile apps that allow customers to access information, file claims, and make changes anytime. Apps also provide tools that customers can use to assess risks, get quotes, etc.
- They are creating online communities and discussion forums for customers to connect with agents and each other. This allows insurers to provide social customer service, get feedback, and build relationships.
Adopting digital ways of working internally, using the cloud, automation, IoT, etc., to simplify processes. This improves productivity and allows insurers to bring innovations to market faster.
Digital capabilities help insurers provide better, faster service and deeper engagement. Customers benefit from convenience and personalisation, and insurers gain efficiencies internally.
2- Rise of Ecosystem Play
Insurers are increasingly pursuing ecosystem plays – strategic partnerships with other entities like banks, fintechs, health tech platforms, etc.- to expand their distribution networks. Through such partnerships, insurers can cost-effectively target niche, digital-first audiences. This is especially useful when entering new geographies or customer segments.
3- Personalized Product Offerings
Usage-based insurance, pay-as-you-use insurance, and micro-insurance products are gaining prominence as one of the top general insurance tech trends. Insurers can develop customised products by analysing customer data and identifying coverage gaps.
Many insurance companies offer rider insurance, EMI protection plans for credit card users, mobile phone damage insurance, one-hour, two-wheeler insurance, and other innovative offerings that cater to customers’ emerging needs.
4- Focus on Preventive Healthcare with Data Analytics
Data analytics on past claim patterns can also enable insurers to predict future claims more accurately and develop targeted risk management programs. A shift towards preventive healthcare can transform customer value propositions in health insurance. This is the reason, data analytics is considered one of the major general insurance tech trends transforming how insurance companies manage risks.
5- Rise of Usage-based Insurance Using Wearable Tech
Enabled by telematics technology involving internet-connected devices, usage-based insurance (UBI) is emerging as an innovative model. UBI insurance premiums are based on policyholders’ usage rather than standard demographic factors.
For motor insurance, insurers can track policyholders’ driving behaviour metrics, such as average speed, mileage, complicated braking incidents, etc., to determine dynamic pay-as-you-drive premiums. For health insurance, wearables can track lifestyle habits.
6- Allowing Customers More Control with Self-Service Tools
Insurtech firms like ACKO give customers more control over their insurance policies through self-service tools. Features like online renewals, customisation of coverage needs, mid-term modifications, and hassle-free claims management improve ownership.
Insurers are also working towards speedy claim settlement through technologies like drone surveys, AI-led assessment, and more. Some firms have reduced claim processing time to as low as one hour!
Such initiatives enhance customers’ post-purchase experience. With personalised premiums and targeted rewards programmes, insurers can enable customers to optimise their insurance coverage based on their lifestyle and risk appetite.
7- Emergence of On-Demand Insurance
As customers’ needs become specialised, insurers launch innovative on-demand insurance covers that can be purchased instantly only when required. This includes insurance for single trips, scheduled flights, intercity rides, movie/event bookings, etc.
With customisable tenure ranging from a few hours to a few months, on-demand insurance provides affordable protection only for the customer’s desired duration. Instead of a yearly renewal, the insurance coverage starts and ends with the activity/trip.
Closing Thoughts
In India, the general insurance sector has a lot of growth potential. At the moment, insurance penetration is very low. Many people and organisations do not have adequate insurance to cover them against financial losses in case of unexpected eventualities. Such firms stand a good chance of benefiting if they can use technology for purchase convenience, affordability, coverage completeness, and service delivery without hitches.
Strategic tie-ups between insurers, healthcare providers, auto companies, and banks can also unlock synergies that translate to better products for policyholders. Adopting digital transformation with data analytics and AI can enable hyper-personalisation. Building online communities to engage customers can improve insurance education and awareness.
