By Nirjhar Majumdar
The insurance coverage sector is poised for a digital transformation in advertising and marketing, underwriting and processing of claims. Increasingly insurance policies are being offered on-line. Providers are being made out there in self-service mode on buyer portals. Funds of renewal premiums are additionally being made by way of digital medium in rising numbers. This isn’t simply due to a pandemic state of affairs forcing individuals to go for digital channels. That is primarily as a result of digital channels are preserving operational prices of insurers low and buyer expertise excessive. In spite of everything, it’s the expertise that issues extra than simply “insurance coverage cowl”. Underneath such circumstances, the query is what the position of insurance coverage brokers might be on this digital period.
Insurance coverage brokers can nonetheless play a really essential position each within the space of buyer acquisition and buyer retention. Insurance coverage basically and life insurance coverage, particularly, just isn’t correctly understood by most Indians even now. Digital advertising and marketing, insuretech and synthetic intelligence (AI) can go a great distance in rising insurance coverage penetration. However these alone can’t reduce the ice. In life insurance coverage, one-on-one interplay continues to be an integral a part of the gross sales course of in India even within the easiest of merchandise like time period assurance and assured return plans.
Insurance coverage brokers can play an necessary position in bettering insurance coverage penetration of the nation by rising the persistency stage. In truth, 61-month persistency ratios for nearly all insurers are languishing properly under 50% whereas the worldwide benchmark in 65%. This can be a unhappy commentary on the state of the business.
AI and Machine Studying (ML) enabled Retention Analytics may also help insurers in getting many warning indicators earlier than insurance policies truly lapse or get surrendered.
Most brokers have a behavior of preserving contact solely with the purchasers they think about “worthwhile”. The actual fact is all prospects are worthwhile and the values enhance with the rise within the age of consumers, as a result of life insurance coverage wants manifest correctly solely when an individual is evident concerning the monetary duties he has to shoulder in life. Brokers ought to spend extra time catering to the localised wants. Many insurance policies lapse as a result of their brokers have been terminated or have even left the business. Some prospects have unresolved points with their brokers.
Insurers ought to give high precedence in caring for such prospects, no less than within the close to time period. Insurers ought to dedicate as a lot time in retaining prospects as they dedicate in buying prospects. Higher persistency means higher solvency ratio and availability of a lot larger investable cash for funding. That may fetch higher returns for the purchasers. Though life insurance coverage just isn’t the suitable car to make earnings on “investments”, in our nation, individuals will proceed to search for returns for some extra time. Higher engagement is required to convey the message of life insurance coverage.
That can’t occur solely by digital channels. Insurance coverage brokers can play a important position in positioning life insurance coverage correctly within the monetary market. For that, a brand new model of brokers might should be developed. The brokers are purported to assessment the life insurance coverage wants every so often on the premise of the altering profiles of consumers.
AI primarily based expertise can determine individuals who might be true representatives of the insurers. The insurers have to choose them up from the market and groom them properly. These youths might be the insurance coverage brokers of tomorrow. New era youths will in all probability have a number of careers at a time. A few of them are positive to seek out ardour in promoting insurance coverage. These brokers might be more adept in buying prospects, retaining them and assembly their varied insurance coverage wants throughout the complete life cycle of the insurance policies.
The author is assistant secretary, Kolkata Audit Centre, LIC of India