The sudden outbreak of COVID-19 crisis has affected almost all sectors across the world and insurance is once such sectors which is facing several challenges amidst the deadly virus. From Face to Face meetings to digitally onboarding new customer, the industry is trying to explore several opportunities in the crisis situation. However, experts believe that the pandemic has positioned insurance in the minds of the people. Underlining the emerging challenges and opportunities for the insurance sector during Covid-19, Varun Gupta, EVP & National Head – Axis Bancassurance Relationship, Max Life Insurance, while addressing a virtual panel discussion organised by Elets Technomedia, said that “If you see the Google searches of life insurance post covid, there is a growth of 27 percent year-on-year versus single-digit growth last year and the term insurance has gone-up by 100 percent versus 16 percent in the corresponding year.” During the discussion, he also spoke about the transition of insurance sellings from Face to Face mode to Home To Home model.
Excerpts of his address:
There are several behaviours associated with the life insurance purchase journey. The recent disruption of covid has actually challenged some of those behaviours and actually creating a permanent change and paradigm shift for all the insurance. The life insurance product is positioned in the minds of the people as a push product. Because you don’t get in the morning and say that I want to buy life insurance today. They usually wait for a banker or an insurance agent to position that product to you. But we have also witnessed that whenever there is a life-based trigger. For example, if there is a death in the extended family or a family member is going through critical illness, people get triggered.
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And, Covid outbreak is a large scale life-threatening trigger. This has created a greater realization in our community, to safe guard the financial future of our loved ones. If you see the Google searches of life insurance post covid, you will see a growth of 27 percent year-on-year versus single-digit growth last year and the term insurance has gone up by 100 percent versus 16 percent in the corresponding year.
Another important aspect or behaviour was of face-to-face selling, as insurances are very advised based sales. The social distancing norm and lockdown has impacted this face to face advice and selling. Hence, all the insurance companies have adapted themselves for virtual sellings. In our company, we call it H to H selling or Home-to-Home selling. So, Face to Face or F to F selling has now become H to H selling.
There are a few challenges associated with this. The proposition as a whole is becoming as important as the relationship that we have with the customer. Usually, we used to survive with the relationship of the banker or credibility of the agent and that was the fulcrum of converting our business. However, digital selling and the increased access that the customer has today for information is progressive. The whole proposition of knowing the right price, underwriting smarts or the claim paid ratio has become extremely important. The second opportunity is to create a sustainable B2C model or a direct to customer model.
We are already observing that banks across large markets are observing 30-40 percent increase in their online and mobile transactions, and thereby the branch visits are actually going down. Therefore it is becoming imperative that we create journeys that are direct to the customers and offer a differentiated experience to them. And, it is clear that customers are getting used to the complex situations created digitally. If you can have a conversation with your doctor digitally or get online education, our belief is that even life insurance can be sold digitally. I believe, life insurance providers would have to play on some of these fronts to have a huge advantage in these times.