Digitisation enables a better future for the insurance industry

Asit Rath

Technology is redefining scalability and cost optimisation. As a result, it will be easier to start a movement that will assist the customers in discovering healthier versions of themselves, shares Asit Rath, Chief Executive Officer & Managing Director, Aviva Life Insurance India, in an interaction with Rashi Aditi Ghosh of Elets News Network (ENN).

What are the major opportunities and obstacles in the insurance industry?
The life insurance industry in India has the potential for exponential growth. The COVID-19 pandemic has heightened awareness about the need for insurance. Simplified product regulations present an opportunity for companies to streamline their offerings and make them more accessible to a wider range of customers. Moreover, the appointment of insurers as lead insurers in certain states can drive insurance penetration and increase awareness of the importance of protecting one’s health and life.

Technology is a huge player in increasing insurance penetration. Insuretech companies are solving challenges around distribution, financial and medical underwriting, and targeted marketing, making it easier for customers to access insurance products and services. Additionally, government databases, such as those related to Know Your Customer (KYC) and account aggregation, as well as national health records, provide opportunities for insurers to improve their operations and increase their reach.

However, the insurance industry, like many others, is facing challenges in adapting to the rapid changes brought about by the pandemic. The speed at which large insurers can respond to simultaneous developments in the external environment can be a challenge. Lastly, finding new and innovative distribution models that can reach beyond the traditional urban mass affluent segment can be a challenge for insurers.

What role is social media playing in popularising the usage of digital payments in the insurance sector?

With the widespread adoption of digital technologies for remote work, the pandemic brought about a rapid shift in the way businesses operate. What was once considered innovative, such as the ability to pitch and sell products remotely, became the new normal during and after the pandemic. The long- term impact of the pandemic on traditional industries like life insurance was a newfound willingness to explore and adopt new technologies. With a thriving tech industry in India, including fintech, health-tech, and
insure-tech, the Indian insurance industry has the potential to become a leader in technology adoption. This will lead to a large number of use cases of technology usage that may soon be exported to other countries for adoption by their insurance industries.

What role is social media playing in popularising the usage of digital payments in the insurance sector?

When discussing digital payments, UPI is the flagbearer of the fintech revolution. Undoubtedly, the credit goes to the Government of India and the regulatory bodies for introducing and pushing this technology.

Today, we have the National Health Mission, which is digitising all the records of the masses. It will be a phenomenal transformation in the way we assess healthcare in the country. With the increase in banking and digital payments, it has become easier to determine a customer’s financial standing, and this data can be used to make informed decisions.

With consumers spending a significant amount of time on social media, companies are utilising this by creating engaging and informative content on these platforms. Social media is becoming a crucial space for fintech players to interact with their audience in a meaningful way.

How are you coping with the trends that have been causing the insurance industry to rethink its operating models, such as digital transformation; the rise of environmental, social, and governance (ESG) concerns?

Brands that have adopted social media and aligned themselves with consumer interests are seeing great success. In our case, we plan to transform our business operations entirely by forming strategic partnerships to shift our focus from just selling insurance for protection to prevention.

Furthermore, significant advancements are being made in wellness and health technology, with some solutions being both scalable and cost-effective. By embracing these technologies, we aim to facilitate a movement that will enable our customers to achieve better health and wellness, something that was previously not possible. The cost of preventative measures to address common ailments in India is significantly less than
the cost of treatment. This aligns with our commitment to social responsibility.

Also Read | Digitisation brought fresh waves of reform in the health insurance sector

What is the biggest challenge your organisation is facing in reaching out to the lower-income group people and helping them to get affordable insurance?

Our customer base primarily consists of urban salaried individuals in India, which is a common challenge faced by many insurance  companies. Reaching under-served populations such as those in semi-urban and rural areas is challenging due to the costs associated with physical offices, recruiting agents, and educating customers about complex products.

However, now that technology has taken the front seat, the onus is on us to create simple products that can be digitally delivered through various innovative distribution partnerships, making it sustainable.

What are the innovations you have planned for the next five years?

We have upheld our core values since our establishment, which is over 326 years ago. Our focus is on supporting our customers in achieving their health goals, such as developing healthy eating habits, engaging in regular physical activity, and getting regular health check-ups. These are essential for a healthy and prosperous future.

Our innovation journey will revolve around partnerships with various players in healthtech and fintech. This will enable us to be at the forefront of the innovation space through a collaborative approach.

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