The digital era has redefined the relationship between customers and service providers. While anytime-anywhere access is a business imperative today, hyper-personalised solutions and frictionless experiences have become brand differentiators. The insurance industry in India has embraced digital transformation to automate administrative processes, streamline compliance, and improve risk management. The synergies of cutting-edge technologies, such as cloud computing, AI, blockchain, IoT and big data analytics, have empowered insurers to expand their reach. Most importantly, optimising digital distribution channels has become critical to remaining competitive in the long term.
Digital Distribution Disruption
The introduction of self-service tools, leveraged by brokers to enable comparison and customisation of products, emphasised the need for expanding the application of digital channels for insurance providers. Insurers have discovered that there is more to digitisation than a passive online presence. They are now turning to digital channels to attract, convert and retain customers. However, the insurance industry still needs a change in its distribution mindset to optimise digital channels.Â
Increasing Direct Sales
Today’s digital native customers prefer to shop online. They want consistent interactions across channels and seamless onboarding experiences with prompt query resolution. And what could be better than an AI-powered digital assistant facilitating that for you? The insurance industry in India has made significant strides in leveraging the convenience culture and insurtech companies are helping transform the passive digital presence into an effective conversion funnel. For instance, automated WhatsApp chats are now the norm, over emails and calls, to capture the customer’s attention without intruding on their daily schedule.
Beyond Engagement
Picture this: while commuting back home from her office in the crazy Bengaluru traffic, Natasha realises she needs to buy health insurance. She searches the web on her smartphone, reaches your social media page, and downloads your app. You just got a significant lead! Insights from her healthcare or banking data can help you recommend the best policy for her. Conversion becomes a breeze with personalised recommendations, while digital distribution channels make buying insurance as easy as grocery shopping.
Social media channels are a great way to get noticed and engage customers. This is also where you can initiate conversion journeys. Facilitating direct app downloads to enquire, apply and manage policies has been a game-changer for the insurance industry in India. No more waiting for the weekend for the customer’s availability to meet your agent.
Tapping into the Power of Data
While digital channels are a goldmine of data, collaboration with the banking, automotive, healthcare and other industries exponentially improves the quality and reliability of insights. Insurtech provides access to insights, such as customers’ preferred channels, purchase behaviours, insurance needs, spending habits and more, to help you forge meaningful relationships. You can discover emerging opportunities and tailor policies and premiums to meet their requirements.
Did you know you can also evaluate the effectiveness of a channel with engagement, conversion, sales and accuracy reports? These can help you identify and remove performance gaps between distribution channels.
Insurance at the POS
Insurance for automobiles and electronic gadgets at the time of purchase is a common practice. Embedding insurance at the point of sale (POS) for the entire digital ecosystem is key to gaining a competitive advantage. For instance, a pregnant woman might plan to buy an insurance policy once her child is born. You can get that information via digital channels, such as social media. You do not have to wait for the customer to approach you. Proactively introduce them to your rider plans or, better, embed them within the pre-natal care plan at her hospital for convenience.
Reducing Digital Insurance Cart Abandonment
Cart abandonment is a prominent concern in the ecommerce sector. Insurtech companies enable insurers to optimise their marketing strategies to minimise cart abandonment. Innovative insurtech integrations can optimise the use of cookies, targetted advertisements and tailored discounts to bring the customer back to the cart and complete the purchase.
Optimising Digital Distribution Channels
API-based, integrable insurtech platforms allow you to create seamless digital interaction channels. However, maximising productivity after onboarding a digital distributor is important to optimising ROI.
Offer Distributor Support
Develop a sales engagement tool to educate your partners on improving their conversion rates.
Enable your distributors to address customer queries promptly to close sales.
Power your platform to offer adequate distributor support and take over complex cases proactively to prevent losing customers mid-journey.
Insurance providers must offer differentiated compensation and quick payouts to secure the best partners from diverse industries.
Utilise Data
Leverage automated risk assessment, underwriting and claims management to improve the accuracy and speed of operations and reduce the manual workload.
Leverage data from digital distribution channels to incentivise high-performing distributors. This will help you to position your business as a sought-after insurance partner.
User-Friendly Digital Touchpoints
An intuitive interface is a key component of digital distribution modernisation. Provide customisable dashboards with role-based access for customers, executives, decision-makers, and third-party partners.
Leverage analytics to offer consumable reports to decision-makers and stakeholders. Offering easy-to-access policy details and policy management features for customers can help improve customer experiences.
Gamification tools, such as incentives for meeting daily health goals, can be a great way to keep healthcare insurance customers engaged. This can also serve as a tool to encourage them to include their friends and family in the challenge, helping you reach more potential customers.
Challenges in Enabling Digital Distribution
The insurance industry faces several challenges in optimally utilising digital distribution channels, such as:
Addressing cyber security and data privacy concerns.
Maintaining compliance with the evolving regulatory landscape.
Exploring and identifying the most suitable cross-industry partners.
Enabling agile transition from existing to emerging and future-ready technology models.
Insurtech Drives Digital Success
The online insurance market in India is forecasted to expand at a CAGR of 12.20% between 2024 and 2029 to reach $3.31 billion. Collaborative digital distribution is a natural extension of paperless customer acquisition via the individual’s preferred mode – mobile or web apps. The key to leveraging the massive opportunity for the insurance industry in India is to fortify their digital distribution channels.Â
Insurtech forms the backbone of digital distribution, transforming the insurance industry with disruptive underwriting, claim management and customer engagement solutions. It is a holistic approach to leveraging digital innovation while navigating challenges.
An Insurtech partner with deep experience is the key to differentiating yourself from the rest. InsurTech companies in India offer powerful solutions to identify the most suitable channels to reach your target audience and tools to make their journey frictionless. They also help you choose the best digital distribution strategy and engagement mechanisms to enhance conversions.
Against macroeconomic headwinds of demographic shifts, changes in customer preferences and rapidly changing trends in the industry, leveraging every opportunity to attract and retain customers is paramount for insurers. Insurtech refines the data-first digital business model to offer deep insights into compensations, competition and customer preferences. Greater visibility and accurate predictive reports enable insurers to make informed decisions and take proactive action to meet the upcoming demands of the industry.
A diversified mix of distribution channels translates into a competitive advantage that allows insurance providers to nurture their customer relationships deeply. The IRDAI is in the process of introducing reforms to enable insurance providers in India to promote distribution agility and insurtech growth. This aligns with the regulator’s efforts to realise the “Insurance-for-All” goal by 2047. Leading insurtech companies are a force of change, offering innovative solutions to support cross-industry collaborations.
Bibliography (Last accessed on September 12, 2024)
