Mumbai: With the rise in the popularity of smart phones and internet among the new age consumers, it is estimated that three in every four insurance policies sold by 2020 would be influenced by digital channels during either the pre-purchase stage, purchase or renewal stages, according to a new report by Boston Consulting Group (BCG) and Google India.
According to it, not only will insurance sales from online channels grow 20 times by 2020, but overall internet influenced sales would be in the range of Rs 3 lakh crore to Rs 4 lakh crore.
“Digital disruption is expected to impact insurance significantly and considered an opportunity or a threat, insurers need to be creative to leverage this opportunity immediately,” said Alpesh Shah, senior partner and director, BCG.
Mr Shah pointed out that traditional business models are being challenged by the emergence of trends such as less relevance of physical footprint, mobile internet and social platforms.
“The digital adoption could result in potential savings of 15-20 per cent of total costs in the case of life insurance and 20-30 per cent in the case of non-life, thereby showing the path towards profitability for the industry,” he added.
According to the Google Consumer Barometer 2013, search engines are the most popular touch point for customers seeking information. Growth in Google search queries related to insurance in India has been exponential since 2008 - six times in the case of motor insurance and 4.5 times in the case of health and life insurance.
The report observed that in health insurance, 14 per cent of the insurance buyers were digitally influenced while 32 per cent searched for information about the product and 19 per cent made an order and payment. “The percentage of these customers purchasing online has gone up steadily with health insurance buyers increasing from 13 per cent in 2012 to 19 per cent in 2013 while motor insurance buyers saw a corresponding jump from 13 per cent to 16 per cent during the same period,” the report said.
