When insurance goes online

MUMBAI, INDIA: Internet has modified traditional business methods and approaches. For instance, buying an insurance - whether it is health, life, property or vehicle - normally takes fair amount of time and paperworks. Right from convincing the customers, payments and finally delivering policy documents at the customer's door – all are lengthy and complex processes.

However, on the Internet all these processes are far more quick, transparent and easy. Today, there are many insurance companies and websites that sell insurance products online with cash-less payment options like credit cards, debit cards, cheques, drafts and netbanking.

Policybazaar.com, a Gurgoan-based portal, sells life and non-life insurance products from 20 different insurers with discounts. It has the comparative rates features to helps customer to pick the best suited insurance at a fair rate.

According to Policybazaar's CEO, Yashish Dahiya, insurance is a transparent product and it needs a lot of transparency.

“In the offline mode, the agent and customer interacts, but there's no auditability of the meeting. There's a chance of cheating as the agent can mislead with false claims and information and he wouldn't be able to provide fair comparative rates and product details because he sells not more than one or two companies' products,” Dahiya says.

“Websites have three top qualities – they are ethical, informative and genuine. In bringing transparency to insurance products, IT becomes the enabler - where all details, information and comparative quotes across products and companies are easily available to customers on the website,” he explains.

While Policybazaar.com was started in June 2008, the Mumbai based Insurancemall.in, launched in 2006, and promoted by Bonsai Insurance Broking Private Limited, claims to be India's first insurance shopping portal.

“In general, in the offline mode, the agent has to memorize all product details and at times can miss out key points. Here it's more like trying to sell the product, while the website carries each and every information that offers transparency and, in turn, allows the customer to decide the purchase of product,” says Mahavir Chopra, Insurancemall's CEO.

“Selling insurance products on the Internet saves a good amount of operational and business costs that is required in the offline mode,” adds Chopra.

Similarly, ICICI Lombard offers all types of retail general insurances online like home, health, travel and vehicle.

According to ICICI Lombard's marketing and e-channel head, Kartik Jain, awareness about online channel is growing steadily among the customers.

“Customers are more open to the idea of buying policies online as it saves time, is convenient and transparent. Online insurance, we believe, is the future of general insurance and one of the growth drivers for our business,” says Jain.

Further, he adds that online medium is gaining popularity day by day as it offers a transparent view to customers on the policy coverage, exclusions, premium and the claims process.

“A digitally signed e-Policy is issued within 10 minutes with the hard copy couriered the next day and an online account is created with a secure login ID and password via which the customer can view, print, renew and extend his/her policies,” explains Jain.

Stressing IT's importance, Jain points out, “With the customers as a focal point, our e-commerce strategy is aimed at enhancing efficiency even challenging our own processes and the traditional business methods.”

He said the company has launched the first-of-its kind mobile commerce service enabling customers to buy the insurance cover over the mobile phone.

About 60 percent insurance bought in the UK, Australia and the US is over the Internet and there's a growing trend towards customer self-service, he said.