The global financial landscape has witnessed a seismic shift in the last decade with the emergence of financial technology companies or Fintech’s armed with new-age tech tools. While offerings like digital payments, block chain, big data, AI based chat bots etc may be mainstream today, this constant evolution of technology has been an able disruptor in the financial world.
Such has been the surge that some of the oldest and traditional financial firms including the likes of Goldman Sachs, JP Morgan, and CitiGroup are now seen as biggest Fintech promoters. With global banks and financial bigwigs along with contemporary Fintech companies all investing heavily to offer technology-based solutions, the surge in the Fintech space is eminent. A recent report suggests that the Global Fintech market size is expected to grow to $ 124.3 Billion by the end of 2025 at a Compound Annual Growth Rate (CAGR) of 23.84%. India along with neighboring China have merged as two of fastest growing markets with a fintech adoption rate of 87 % much higher than the global average of 64 %. When it comes to investments, India is surging way ahead becoming Asia’s top FinTech funding market attracting investments of $286 Million over $192.1 million in China in Q1 2019. Overall, the transaction value in the Indian FinTech market is estimated to reach $140 Billion in 2023 from the current levels of $65 Billion.
Emergence of InsureTech- the Able Fintech Subset
What drives the above mentioned statistics and increasing investment numbers is the constant need to move with changing times staying relevant to today’s consumer. Traditionally the Insurance sector was largely seen as one relying on limited parameters like personal financial acumen, tax benefits or able selling by insurance advisors. Today InsureTech as an able subset of Fintech has made it possible for insurers to make use of Smartphone apps, wearable technology etc automating everything from policy underwriting to processing and handling of claims.
Technology disruptions adopted by insurers as part of InsureTech is allowing them to offer seamless and instant services by smart collection and analysis of customer data. The emergence of InsureTech has completely transformed the way insurance is being sold and serviced. The Indian insurance sector is expected to grow to $150 billion by 2023 driven largely by InsureTech. More importantly, technology drivers are helping insurers make a move to where the customer is and offer innovative services instead of passively waiting for a customer to walk in to seek insurance.
InsureTech- Fulfilling Customer Expectations
Today’s consumers no longer seek services but prefer mobile based solutions which are instant and tangible. InsureTech backed by its technology disruptions has made it possible to offer polices that add value to the consumer as per their personal needs while delivering them amid a fully automated and digital environment.
Today a consumer can buy personalized insurance plans tailor made for his needs in real time. Insurers along with insurance aggregators allow for instant plan comparison to choose the best policy. Payments for the premium can be made online using digital channels and the policy delivered digitally over the mobile phone in real time. Buying an insurance policy today is therefore no different to making an e-commerce purchase just as the modern day consumer wants it to be.
Surging Numbers and Digital OTC Experience- an Insurer’s Goldmine
A Boston Consulting Group report estimates the number of internet users in India to touch 850 million by 2025. With insurance numbers set to surge high, technology is what is allowing insurers to keep the cost of distribution and servicing low while increasing penetration. From things like offering remote inspection for minor injuries or damages over physical visits by surveyors to use of AI based tools to offer personalized plans, InsureTech offers a cost effective high selling leverage for insurers.
The world of InsureTech is what is allowing insurers the power to make a move towards the customer offering personalized digital plans with a seamless OTC experience from policy purchase to claims.