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Published on: Jan. 12, 2021, 5:09 p.m.
Digitalisation at Kotak Mahindra Life Insurance pays off
  • Agarwal: ensuring superior customer experience

By Arbind Gupta. Assistant Editor, Business India

The Covid-19 pandemic has significantly increased awareness about the need for insurance as a crucial part of financial planning. It has resulted in increased demand, particularly for protection category of products. Also, it has been observed that individuals are now more comfortable with digital modes of transacting with distributors and insurance companies, including both sales and servicing. Insurance companies on their part are also trying to further simplify the processes and products through digitisation and analytics. The regulator has also supported the industry in the process of simplification and product innovation. 

“Overall, the behavioural shift seems to be continuing beyond Covid-19,” says Suresh Agarwal, president, Kotak Mahindra Life Insurance Co Ltd. “And, combined with relatively low insurance penetration in the country, this should lead to sustained increase in demand for life insurance”.

During the lockdown, the insurance company has expedited its whole digital transition process in order to ensure business continuity. Backed by digital interventions, it continued uninterrupted services to our customers without the need to visit branches. The company also enabled its distributors to operate remotely through various digital tools. The insurance entity has taken various digital initiatives to significantly enhance customer experience. Towards this end, It has been able to make personalised pre-approved offers to customers using data and analytics as also enabled paperless and hassle free customer on-boarding, easy buying of policy through e-signing using Aadhaar, enhanced servicing capabilities through self-service portals, WhatsApp, insta-servicing bots, etc.  

For its distributors, the company has completely re-defined its processes. The distributors are today on-boarded digitally and also trained on digital platforms. They manage their sales leads digitally, carry out log-in policies through mobile-based apps, get instant commission, and even track their performance on mobile apps. 

In line with its principle of ‘Customer first’, the company will continue to strive to take customer experience to the next level through innovative products and processes. “We continue to support our distributors to enhance their capabilities through cutting-edge digital solutions,” affirms Agarwal. “We will also continue to scale up our business through our various existing and new partnerships and grow faster than the industry average”.

Growing awareness

“We are among the largest recruiters of agents,” he adds. “We also have large number of tie-ups with banks and digital partners. And we will continue to innovate with a view to ensure superior experience for customers as well as distributors”.

With regard to term insurance rates, Agarwal is of the view that recently there have been marginal upward revisions at the industry level in certain buckets based on mortality experience and re-insurers’ advice. However, the demand is robust based on increasing awareness. Overall, there is an increase in the demand for protection category of products, in addition to sale term plan.

  • Our recently launched health insurance product ‘Kotak Health Shield’ has elicited a great response from customers. It is a fixed-benefit health plan, covering cancer, cardiac, liver, and neuro conditions, all in a single product, and at affordable rates, which is a unique and differentiated proposition in the industry

“We are also seeing active demand for various riders, such as offers to cover critical illnesses, permanent disability benefits and accidental death benefits,” he informs. “Our recently launched health insurance product ‘Kotak Health Shield’ has elicited a great response from customers. It is a fixed-benefit health plan, covering cancer, cardiac, liver, and neuro conditions, all in a single product, and at affordable rates, which is a unique and differentiated proposition in the industry. Rising health treatment cost continues to be a major financial strain to millions of Indians”.

Life insurance penetration in the country is relatively low at under 3 per cent of GDP and this presents a huge opportunity for insurance providers. Experts are of the view that the penetration level will pick up, going forward, driven by economic growth, rising incomes, large working-age population (close to a third of the population in the age group of 15 to 59 years), huge protection gap, increasing financial awareness, and various government initiatives.

Also, life insurance products have moved from being perceived as merely a tax saving option to a protection and long-term savings product. While tax benefits continue to be a significant factor, the realisation has set in that life insurance products are the only financial instruments that offer a ‘sum assured’. Millennials use life insurance products for protection, long-term savings and also for tax benefits and are particular about superior customer experience and tend to compare the experience across industries.

Agarwal is of the opinion that, after a slow start to the financial year due to the pandemic, the industry is catching up with previous year’s levels. “On the whole, we expect the year to reach or slightly exceed previous year’s levels,” he informs. “In 2021, we expect the industry to grow at 10-15 per cent, aided by economic recovery and higher awareness among customers”.

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