We are living in times of an unprecedented crisis where risk and uncertainty have reached new highs. While the insurance industry witnessed a spike in investments, COVID-19 has had a lasting impact on the insurance sector. Health and life insurance is not just a matter of benefit but a necessity in these times of emergency. In these dire times, health and life insurance has acted as a hedge against the rising uncertainty. It is predicted that the majority of individuals will be inclined to get a risk cover, in the coming days.
As most countries are reeling from the second wave of the COVID-19 pandemic, there is a heightened and persistent awareness about reducing the treatment expenditure for health. It is here that Insurance industries have been forced to change their approach to meet current needs. There is a greater emphasis on tailor-made solutions for clients and various other change that delineate a seismic shift. So, let’s delve deeper into how COVID-19 has changed the insurance industry and why these trends are here to stay, based on insights from axway.
Long term financial security
The disruptive nature of subsequent lockdowns, job losses, and an economic downturn has made people realize the importance of emergency funds. Fortunately, India has a strong culture of savings. The term or life insurance policy today has become more important than ever for people across the world. For term insurance, age is a key component and it is best started early. Today, many insurers are offering terms plans with reduced premiums in a bid to make them more affordable. People are also increasingly looking at complete health and accident covers for dependents in times of increasing uncertainty. The value of gross premiums collected by life insurance companies is over five trillion Indian rupees. The level of insurance penetration is also increasing greatly.
Customized insurance solutions
Insurance companies have been forced to undergo a digital transformation to cope with the requirements of the new normal. Individualized and on-demand insurance products and services are in vogue. Customers are increasingly seeking insurance products that are affordable and meet their requirements better. For instance, many people today prefer hybrid insurance policies that offer life insurance and healthcare benefits that are sought after. Customers can choose to set the policy’s value in the long run based on their requirements. Hybrid solutions are preferred over conventional medical insurance policies. Many insurance companies are offering hybrid solutions that give consumers a more customized experience and better long-term value, in terms of insurance benefits. Some of these insurance solutions are designed based on insights derived from Artificial Intelligence and Machine Learning.
Technology for better claim settlements
Various technological advancements like AI and automation have not only expedited the process of claim settlements but have also made it more efficient and accurate. Manual workflows and paperwork are eliminated with claims management software and so is the need for constant human interaction. The process of handling claims becomes significantly smoother. Insurance companies reduce red tapes, human errors, incessant delays due to manual processes, and save on labor costs. Further video-surveillance helps insurance companies to make fairer settlements. The claims management software can automatically calculate the coverage and payment for claims based on specific parameters. The entire process of claims management today is more efficient.
As insurance companies increasingly rely on fintech, the insurance sector has become more efficient, seamless, and reasonable in the eyes of its consumers. Today, the technology exists to create hassle-free customer experiences. The days of waiting long ques for claim settlements are a thing of the past. Data, analytics, and other technological solutions are being leveraged to create groundbreaking customer experiences.