Term Insurance, Insurtech Startups on the Rise in India.

June 24, 2024
1 min read



Term Insurance and the Rise of Insurtech Startups in India

TLDR:

Key Points:

  • Insurtech startups in India are revolutionizing the insurance market by offering innovative solutions through seamless customer experiences and data-based underwriting.
  • Term insurance, a relatively new concept in India, is seeing significant impact from insurtech firms by addressing key issues such as limited awareness, offline processes, and lengthy claims settlement.

Term Insurance and the Rise of Insurtech Startups in India

In recent years, the Indian insurance industry has witnessed the emergence of numerous technology-driven insurance startups. These startups are revolutionizing the market by offering innovative solutions through seamless customer experiences and data-based underwriting. One key insurance segment seeing massive insurtech impact is term insurance. The evolution of term insurance in India has been shaped by the challenges of limited awareness, offline processes, and lengthy claims settlement. Insurtech firms have leveraged technology, data, AI, and automation to address these pain points and enhance efficiency across the term insurance value chain.

Evolution of Term Insurance in India

Term insurance, a relatively new concept in India compared to traditional endowment plans, provides pure risk coverage in case of the policyholder’s demise during the policy term. Despite the cost-effectiveness of term plans, their adoption in India was slow due to factors like limited product options, lack of awareness, and unmanageable offline processes. This presented a significant market opportunity for insurtech startups to disrupt the space and innovate every aspect of term insurance.

Critical Drivers for Insurtech in Term Life Segment

Several key factors have spurred the rise of insurtech innovation in term insurance, including limited awareness among buyers, offline purchase hassles, costly medical tests, lengthy claims processes, and lack of transparency. Insurtech firms have used technology, data, AI, and automation to address these issues and improve efficiency.

Areas of Term Insurance Seeing Insurtech Impact

Insurtech solutions have brought significant enhancements to product innovation, underwriting processes, digital distribution, customer experience, and claims settlement in the term insurance space. Companies like ACKO Insurance are transforming term insurance with digital-first models, innovative products, robust underwriting, superior customer experience, and quick claims settlement.

Conclusion

Insurtech is rapidly transforming the term insurance value chain in India, making purchasing and using insurance more seamless for consumers. Companies like ACKO are leading the way in leveraging technology and innovation to enhance the entire term insurance journey. With a focus on technological advancements, insurtech firms are poised for exponential growth in term insurance adoption.


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