Digitization Of Insurance: How Does it Make a Difference

The internet has made inroads into our lives for good. It has made doing many things easy. In a nutshell, it has changed the way we used to buy products and hire services earlier. The influence on the insurance sector is immense too. The convenience, choice, comparison options and incisive information to help make the right decisions are some of the benefits of digitization in insurance sector. Therefore, it is safe to say that days, when agents used to sell the insurance, are gradually getting over and coming is the time when life insurance will be available online only. And why not, the digitization of insurance sector is influencing the life of users for good. If you want to know how, consider reading the information provided below.

Makes insurance process efficient and faster

One of the primary complaints that customers in the insurance sector have is the amount of time the whole process requires. With digital platforms put in place, any insurance company can help its customers find information easily, make comparisons without any hassles and make an informed decision about what type of insurance they need. With an easy option to compare different insurance plans from different companies, digital insurance in India has facilitated the process of getting insured to a great extent.

Big cost-saving advantage

If anyone who has benefited the most from insurance sector going digital, it’s, undoubtedly, the customers. Going digital helps customers save a huge cost that they end up paying as a processing fee otherwise. For example, the brokerage for term plan is somewhere around 30 percent of the premium meant to be paid and between 5 and 10 percent in ULIPs. Effective digital insurance strategies lead to a huge premium difference when a policy is bought online and offline. For example, a customer who is looking for a term plan offering a cover of INR 50 lakh for the next 10 years will end up paying a premium of around INR 3600 through the online process, whereas the premium is INR 5600 for the same plan if bought offline. This is enough to tell the difference.

Helps curb fraudulent practices

The impact of digitization in India is immense and it helps curve fraudulent practices like miss-selling of policies by a distributor or agent. Through digital platforms, now the company directly talks and does business with the customers. Chances of agents not depositing premiums that the customers have paid in cash are zero. Additionally, agents can’t sell only policies that offer them higher commissions.      

Engage more customers in a better way

The world is increasingly becoming digitalized and millennial customers who are now around 35 years old have the capacity to buy. They most likely would love to compare different policies on their own before making a choice. There is a huge communication gap between people of this age group who has the capacity to buy and the insurance companies. To bridge this gap and attract more customers, the role of digitization in insurance is immense.

My two cents

The digitization of insurance sector in India has provided plenty of  benefits to the users. They can easily find the policy related information on their palms, compare similar or different policies at different platforms with the touch of a button, make informed decisions basis what suits them the best and pay less premium amount when buying a policy online than offline.