Listen to this article
Satyajit Tripathy, Member – Distribution, IRDAI said that Bima Sugam, IRDAI’s digital platform can disrupt the traditional distribution channels of selling insurance.
He was talking at the CII Financing 3.0 Summit at Mumbai.
Satyajit also emphasized on the role of the intermediaries in helping people with low digital literacy in Tier-II and Tier-III cities and thereby playing a part in increasing the penetration of insurance products in such regions. He said that the next few years will determine whether the new digital platform threatens or supplements the existing channels for selling insurance.
He also said that like banking and mutual funds, insurance should also become a predominantly digital product in the future in which policyholders do not need to go anywhere to make purchase or transactions.
When it comes to life insurance, Satyajit recommended talking to financial advisors before choosing a product or purchasing annuity. He also warned policyholders that purchase decisions made based on hearsay can lead to regret later.
Satyajit also placed his trust on innovative products offered by insurance companies to bring the next boom in the field of insurance.
Here are other key highlights of his session:
- Innovation, disruption and value addition (IDV) can lead to next boom in the insurance sector
- Grievances are different for life and non-life sectors. For life insurance, biggest grievance is mis selling which is at an alarming level making policymakers concerned. For non-life, rejection of payment of claims is a big issue
- Majority of grievances in non-life insurance comes from health insurance
- Number of negative stories in press due to these grievances hinders the penetration of insurance products
- Motor insurance claim settlement is becoming almost entirely digital for retail. 80% of the claims are from retail customers with value less than Rs. 50,000
- IRDAI and the government are working to make cashless facility more easily available for health insurance
- Government insurance schemes and retail policies are increasing the penetration of insurance
- Non-life to grow by 17-18% whereas life insurers is expected to see 10% growth in the coming years
- Niche products like cyber insurance are tried through sandbox methods by some insurance companies
- Extension of pay as you drive style products are expected to come in the market soon
- Color of the vehicle may decide the premium of accident insurance in the future
