2019's Challenges For Indian Insurtechs

Rohan is an Entrepreneur & a Marketer who has over 17 years of experience in various leadership positions. His major experience is in `Market Entry & Commercial Strategy' across Mobile, Tech, and Consumer Products.

Insurance was privatised 20 years ago and since then, we have seen low innovation on products, positioning and distribution. Currently, insurance segment's penetration in India is still in single digits across healthcare and other non-life sectors, despite boasting an overwhelming potential with a population of 1.35 billion. To financially secure a massively income-divided demographics, insurtechs will face several challenges as they embark to solve such a massive problem. With the beginning of New Year, it is important that companies identify and tackle theses crucial needs.

Making Products Relevant
Finding the ideal product-market fit to serve an extremely fragmented market requires a long-pending makeover, one that just UX & UI alone cannot solve. Digitising insurance alone will not solve customer needs as we have already bared wit-ness to the limited success of aggregators. The products must be re-imagined & deconstructed, and thus made relevant to consumer's lifestyle and associated risks.

An Increased Need for Data
Independent insurtech companies with the autonomy to create their own products have launched in India and their most vital challenge for survival will be retaining ROI on their portfolios and establishing a cash liquidity to develop markets for their products. This stems from the larger issue that there is not enough data available currently. Young, modern consumers are an un-tapped demographics. Insurtechs as well as traditional incumbents will have to understand the true needs of these consumers to build products that best serve them. A scale-as-you-grow model based on immediate customer feedback and market research will arise. It is vital that these companies retain cash liquidity to invent new products real time.

Meeting Consumers' Purchasing Patterns
Using the existing data, partnering with organisations and companies that tap into their psyche and purchasing pattern will ease the bur-den. I believe that in 2019, we'll see a lot of collaboration within the digital sphere. The rampant take-off of financial technology has paved the way for insurtechs. Financially, literate consumers are now well versed with digital payments. What is special about India specifically is that the reach of fintech doesn't stop there. The penetration of digital payments has reached rural areas as well, allowing blue-collar workers to also understand and reap benefits from digitisation. It is now time to extend the product offering. Insurance too can be a QR code and it can be a clickable transaction. Insurance must be made affordable, accessible, and available - available meaning part of an existing paradigm within the consumer's digital world.

Reaching a Fragmented Market
Entry into financial inclusion reaches the masses of India, but it is a difficult journey. Finding where these consumers exist is a fragmented market. Of the 200 minutes spent daily on mobile internet, nearly 40 percent is ac-counted for personal communication. These users are online. The question is how do we reach them? How do brands and companies convert digital users to digital transaction led-consumers?

With these factors in mind, strategic partnerships will play a major role in the success of these initiatives. On the top of the list would be creating a network of growth-sustaining distribution channels that will help in scale. This is a mammoth task that re-quires as much long-term vision as empathy for the present. Insurance is and will remain a push product. However, by providing context to insurance, highlighting the consumer's direct value to their finances, but more importantly, their lifestyle, insurtechs will be able to establish both relevance and availability for their end customer.

Education Barriers Must Be Overcome
As new insurance buyers are being reached, the need to solve for the education cycle increases. India's requirements of financial literacy are clear, but what is not, is how to reach a wide array of consumers, supporting them through their purchasing journey. Here insurtechs have the upper hand and the ability to support incumbents, designing delightful UX & UI product flows. Steady growth spurts of average disposable in-come and the accessibility of data have spurred Indian customers forward. Three out of four Indian consumers have mobile phones, 300 million of which are smartphones. While these numbers are reassuring, access is not the same as application.

Establishing Trust
First time customers require trust and ease. They'll need to be led through the process, feeling support and security along the way. Customer communication strategies will have extreme importance. Insurtechs need to instill a sense of reliability, establishing themselves as upcoming `brands' and clearly communicate to the customer the steps and process of the digital journey they are on. Removing paper from the process is quite easily done in reality; it is allowing that same paradigm to be shifted from paper to digital that will be a key struggle area. It is a young industry, even in India, one of the earliest adopters, and one that I think the global ecosystem will take watch of.