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The Future Looks Promising For Life Insurance Industry: Rushabh Gandhi, IndiaFirst Life Insurance

In an interview with BW Businessworld, Rushabh Gandhi, IndiaFirst Life Insurance, talks about Life Insurance ecosystem in India, challenges and more about the industry during Covid-19

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How has the COVID 19 pandemic impacted the Life Insurance ecosystem in India, broadly speaking? Have you witnessed an increased interest in pure risk products?

The impact of COVID-19 has been felt both at an individual level and organisational level. The threat of financial instability is all pervasive. Disposable incomes have been impacted, which has caused a visible shift in consumer spending. At an industry level, cautious times have caused companies to take cautious measures. This has reduced the overall cost base of insurance companies. The pandemic has triggered a fear psychosis that is driving people to buy life insurance products. This conscious shift in the consumer mindset has put in place the building blocks for higher insurance penetration.

We are now seeing shoots of gradual revival as everyone is adapting to the new normal. Market volatility and falling interest rates have taken focus away from products that offer long term savings and variable returns through linked instruments or annual bonus. This has led to consumer confidence shifting to products with guaranteed returns and to pure protection plans. The fact that life insurance companies are the only ones offering long term guaranteed return products will come into the play and benefit the industry at large.

We have also seen a marked increase in customer interest for pure risk or protection products. Over 10% of the policies sold by IndiaFirst Life in the current FY are from pure risk products. This number is over 5 times the corresponding number of the previous year and that in itself reflects the colossal shift in consumer behaviour towards pure risk products.

Do all Life Insurance plans cover COVID 19 related deaths? Are there any regulatory guidelines in this regard and anything else that the general populace needs to be aware of?

All life insurers cover death related to COVID-19. IndiaFirst Life continues to secure lives and create value by enabling 100% settlement of genuine claims. There are no specific guidelines on COVID-19 related deaths. Nevertheless, the regulators are prompting insurers to come up with options only for COVID-19; both on the life and health side. Thus, if a consumer is looking for a specialized cover for COVID-19, he should have a wider range of products to choose from in the near future. 

What’s your business outlook for the next fiscal? As a relatively new player in this space, what are some of the specific challenges that you face?

With several changes in the regulatory framework, the future looks promising for the life insurance industry. Currently, the insurance penetration is less than 4%. However, because of the fear psychosis triggered by COVID-19, insurance penetration in our country can potentially increase multi-fold. There is an increased awareness for being protected and protecting loved ones from unforeseen risks. In line with this, consumers are more inclined towards protection plans, leading to an increased demand for term products. Life insurance products are finally becoming “pull products”, which a consumer is reaching out on his/her own accord to buy. Here, I wish to inform the readers that the cost of buying a term product may increase because of higher mortality assumptions. This, arguably, is the most opportune time to buy a life insurance product.

IndiaFirst Life has seen degrowth of 14% year-on-year in the first half of the current fiscal year because of the lockdown. The green shoots are however visible. In the first quarter of the year, we de-grew at ~40% and in the second quarter (July-September) we, despite the challenges, grew at ~1%. We are cautiously optimistic that we should end the current financial year with a marginal year-on-year growth. As regards the next fiscal, we are hopeful that normalcy will return and so will the growth rates. IndiaFirst Life was the fastest growing life insurance company last year clocking a year-on-year growth of 25%.

Tell us about some digitization initiatives that you’ve undertaken amidst the new normal? Have they paid off measurably?

Year-on-year, IndiaFirst Life has raised the bar by innovating to become future ready. In the past year, we have continued to enhance customer journeys, and these have served us well at the time of COVID-19. These new-age tech innovations bolstered IndiaFirst Life further as a trusted brand for customers and other stakeholders alike. Some of the pathbreaking initiatives undertaken in the recent past include:

  • Ghar Baithe Insurance: Ghar Baithe Insurance initiative aims to secure the lives of customers from the comfort of their home, through an end-to-end digital process. This online process enables our sales teams and partners while ensuring ‘zero physical contact’ with customers. 

  • Worksite now goes ONLINE with ‘Easy life’: IndiaFirst Life took initiative to simplify the worksite marketing process with a Digital Worksite Marketing solution that can be personalised basis the client organisation and allow for bundling a comprehensive solution through salary deduction

  • Multilingual Website: IndiaFirst Life caters to 98% of the pin codes across the country. In order to offer all our solutions and service to our varied customer base, we launched a multilingual– Hindi, Telugu and Gujarati – website offering enhanced user experience 

  • Self Service : Among the pioneering initiatives with immense potential for best in class customer service a host of touchpoints have been chatbot – IRIS, an award-winning AI enabled IVR and self-service portal for ‘instant’ service. We have also introduced the WhatsApp BOT for 24/7 assistance for customers 

  • Best-in-class claims service and grievance redressal: IndiaFirst Life’s ‘100% Genuine Claims Settlement’ is a movement in the company’s print media coverage and social media narrative. Internally, the company has bolstered the movement with a claims automation project to remove scope of human error, improve seamlessness in services around claim requests, and more efficient turnaround times. 

  • Fraud Analytics for hassle free claims settlement & customer ease:  In order to overcome the lag in TAT and settle claims at the earliest for customers, IndiaFirst Life built a ‘Machine Learning Analytical Model’, which can predict and highlight the probability of fraud claims proactively, and rest can be processed quickly.

All these initiatives have held us in good stead and we are confident that they will play a key role in enhanced business volumes and best in class customer satisfaction scores.

Lastly, please share some words of advice for Life Insurance consumers in India.

One question that I often get asked is, when should an insurance policy be bought. I respond without batting an eyelid that the right time to buy life insurance is NOW. The cost of postponement can be crippling. The earlier one buys life insurance, the better it is for one’s peace of mind. Furthermore, insurance plans are tailored to meet long-term, systematic investment needs of the customer while helping them provision for the certainties in life. The importance of having a life cover with a wraparound savings element cannot be undermined. Life insurance as an asset class provides the right solution for the inevitable situations. My submission to the readers is, get your financial planning right by availing the right amount of life cover to grow your wealth, build your dreams and nurture the aspirations of your loved ones for a secured future.

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Rushabh Gandhi IndiaFirst Life Insurance