Buying insurance online from e-insurers may be cheaper than buying it through traditional insurance companies.
It is almost two decades now since the insurance industry was opened up to the private sector. Over time, there happened a lot of innovation and restructuring in the products and features of the insurance products. What remains the most crucial aspect of the insurance business is to reach out to new buyers. As a buyer, one would have been contacted by individual agents at some point of time to buy life, health or motor insurance. Similarly, while walking into a bank branch, most of us would have been asked to buy insurance plans from them. Also, while surfing the Internet, you would have come across insurer’s offering exclusive online products. In addition to the traditional insurers, these are online insurers or e-insurers.
While individual agencies, brokers or bank-led corporate agency models are offline and need face-to-face dealings, the completely online model also has been in this space for quite some years now. And, these e-insurance companies are different from traditional insurers. “E-Insurance companies operate on a direct to consumer model via online channels to sell policies and service customers without physical agent and broker led setups coming into the fray. Using technology we are able to transform something that’s long and tedious to something that’s quick and easy. Customers can buy or claim or renew a policy on the website, the process is as easy as shopping online through any eCommerce platform,” says Biresh Giri, Appointed Actuary, Head of Product Development & CRO, at Acko General Insurance.
While the traditional model will have its own share of advantages and disadvantageous, even the online model will have its own unique features. There will not be any interaction with an agent as the buying happens online directly with the insurer. In case of any assistance, one will have to approach the insurer directly. But going online saves cost. “Online insurers offer more competitive prices as there are no middlemen involved. It also helps us in servicing claims directly and more efficiently,” says Giri.
At times, not all information may be shared with the buyer at the point of sale. “Unlike sales through agents where there are chances of important information being missed out, chances of this happening reduces significantly in a direct transaction between the customer and the company online,” informs Giri.
However, during the online process, one gets to know everything as the insurer’s put forth the entire details upfront. “Buying health insurance involves understanding of complex product features, utmost transparency is maintained in communicating this through the online channel. Every detail of what’s being covered and what’s not being covered is highlighted and communicated to the customer upfront,” says Giri.
But, is buying insurance online cheaper than buying it through traditional insurers? “Yes, the premiums are comparatively lower than traditional players as there are no commissions and physical distribution costs involved. Additionally, the pricing is also personalized for a customer rather than a one-size-fits-all approach. Whatever is saved is directly passed on to the customers. Hence, one could say that buying insurance online is cheaper than buying it through traditional insurers,” says Giri.
As a buyer – Follow this
Whether you are buying health cover, life cover or insurance for your two-wheeler, make sure you explore the premium across insurers. The right way could be to compare premium over the insurer’s website, e-insurer’s website and also on the insurance aggregator’s websites before making the buying decision. If you are searching for car insurance cheapest premium, make sure you surf the net properly. Buying online gives you full control over what you need and what you are buying as you take an informed decision based on all the terms and conditions disclosed upfront to you.