How Technology Is Changing Life Insurance, IT News, ET CIO

From Ashish Rao

Samir Chaudhary was a tall, lanky gentleman who walked great strides and always seemed like someone who ran against time – full of energy, even after those grueling 12-14 hour shifts at the factory that he spent 36 years on his work was devoted to life. However, it is not his undying loyalty to the factory floor that he will be remembered for. Instead, it is the many policies he has sold to his co-workers and the sons and daughters of his co-workers that he will be remembered for.

He was a prolific life insurance salesman who stopped by homes, explained the ins and outs of life insurance policies, and repeated the act many times to close the deal. He always carried a bag full of documents that his customers had to sign every time he closed a deal. He would then take all the necessary KYC documents and policy documents with him and send them by courier to the regional life insurance office. It took about 15 days for the policy to be issued. After that, he would visit his client’s home again to hand over the final policy documents.

The whole process required at least three meetings with clients, followed by a tedious process of sending documents to the insurance office and issuing the policy, which would take another 10-15 days. It was the late 90s and the insurance revolution was about to change the landscape forever.

Buying a life insurance policy always involved signing multiple documents and providing an equal number of paper copies of KYC documents. This also meant that the completed application or application form had to be physically deposited with the life insurer by the intermediary. This process resulted in a significant time delay between the submission of the documents for the policy, the issue and the receipt by the customer.

Over the years, customer preferences have changed and the industry has endeavored to make the whole process smooth and seamless by using the latest technology. Today brochures have been digitized, product videos have become available explaining features and benefits, and real-time KYC authentication is the norm of the day, offering customers a hassle-free and virtually paper-free policy purchase.

Today, life insurers have integrated artificial intelligence and machine learning into their daily operations to automate complex tasks, ensure error-free transactions and reduce lead times. This has enabled a faster quote review and approval process so customers can get life insurance with just a few clicks. Technology has changed the entire paradigm of buying life insurance from complex to having policies issued within minutes.

Some life insurers have unique offers called Pre-Approved Sum Assured or PASA, which are similar to pre-approved loan offers from banks. These offers are extended to customers who meet a certain fixed criterion and can take out a policy on the basis of a single health declaration. The life insurers use the bank’s KYC authentication to complete formalities and issue a policy. Since there is no further intervention, the customer initiates the purchase and the journey ends with just three clicks on the smartphone.

Likewise, customers have a variety of options to choose from when paying their renewal premium. Gone are the days when agents visited homes and collected renewal checks. Today, customers can pay for their renewal rewards through various online payment gateways such as debit / credit card, UPI, Google Pay, etc. Customers can also activate an automatic debit by signing an electronic mandate form with the life insurer, with the amount of the renewal premium being deducted from the bank account on the due date. This gives customers some breathing space to memorize the payment dates for the renewal premium and enjoy the benefits of their policies without interruption.

Some life insurers have piloted a voice recognition AI-powered “humanoid” solution for the extension of premium reminder calls that can reach thousands of customers in an hour and converse with them in multiple languages.

Life insurance is an indispensable product that provides the foundation on which to build your financial plan. Purchasing is now easy and hassle-free. With just a few clicks, you can provide your loved ones with much-needed protection and limit family savings. Life insurers are continually innovating to make life insurance easier as they play a more important societal role in ensuring that Indian families are protected and achieving their financial goals.

A 3-click buying journey across all product categories is a definite possibility in the near future.

The author is Chief – Customer Experience & Operations, ICICI Prudential Life Insurance Company

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