India’s Dynamic InsurTech Transformation

July 20, 2018

Since 2012, the overall Indian economy shows a healthy growth, with the GDP rising at 7% per annum. It has also seen rapid urbanization with 30% of its population being termed urban. These figures are expected to grow steadily till 2022 and beyond. India has immense potential for life insurers, being the world’s second most populous nation where the 35 or younger age group form a whopping 65% of its 1.35 billion residents.

The Indian insurance sector is set to witness significant growth as well as regulatory challenges from growing digitisation and technology adoption. Though the life and health insurance markets have had essentially healthy growth over the last four years products like an individual regular premium business, new sales, CAGR, and persistence in life products were not quick to follow and need greater scrutiny, to determine underlying causes and take improvement measures to cash in on the potential.

How to Achieve This?


One of the possible key areas is technology and digitalization towards a more customer-centric approach which has proven itself in the leading sectors of telecom, banking, and others, by revamping the business and sales models of commercialized transactions.

While infrastructure development in India focused on high-speed, low-cost mobile platforms and mobile users rising exponentially, broadband and internet speeds remained far below the global average figures of 17.4 Mbps.


The expectation of growth in e-commerce via mobile phones

Nearly 70% of Indians buying life insurance do research and comparisons online. Access to internet, speed and mobile penetration into rural markets are crucial factors that are set to grow with the introduction of 5G services in 2018. The volume of India’s e-commerce transactions, online shoppers, and mobile app shoppers are definitely going to boom.

Aadhaar voluntary biometric identification system

In a short span of 7 years, the government has through the introduction of Aadhar sought to integrate its capabilities with economic activities while increasing access to easy verification and cashless payments. The digitalization of distribution channels has seen the spontaneous rise of over 20+ online web aggregators and insurance brokers spurring awareness, empowering decisions and finalizing sales almost instantaneously finalizing transactions.


The pressure on simplifying the on-boarding of clients, pricing and designing of new policies and effectively using technological initiatives is fraught with challenges.

  • Languages: India has eight main languages, 22 official languages, and less than 15% English usage with 75% of users wanting to use their own languages for transactions.
  • Safety net or rather the lack of a social security network puts the individual and family security at risk.
  • High mortality protection gap. The current sum assured to GDP ratio is 50% indicating a wide protection gap. Coupled with the focus on unit-linked and savings type products, low life insurance penetration and the reluctance to discuss death, disease, and disability on the part of both customer and distributor only bolster the gap.
  • Low persistence and customer satisfaction levels in savings-type products.

Bridging the Gap

According to the IRDA, the rapid penetration of internet and smartphones in India will see an increased adoption of technology and the insurance sector transforming insurance broking channels also through major digital transformation. Technology could simplify the sales process and evolving tools like interactive AI used to explain products and benefit illustrations, make application forms simpler, use effectively voice-to-text technology, and in the making of electronic premium payments acceptable.

Recently-developed financial underwriting algorithms can be merged with credit bureau data to facilitate faster decision making, improving sales and retention.

When empowered with the ability to purchase life or health insurance with minimal and painless information, most clients take rapid decisions resulting in quick sales. A realizable goal is to enable the buying of insurance online with three swipes of the screen and in all of India’s eight main languages. As the market evolves and adapts, there should soon be a day when insurance is bought and not sold whether it be online or offline.

Flexible simplified insurance products and procedures to buy them, easy to understand the terminology and use of the latest digital tools in data analytics will empower and enable ease of transaction and client engagement. In conclusion, the regulatory support and a well-planned execution for implementation will be the critical turning point.



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