Insurance goes digital to secure India
Despite a high economic growth than most developed countries, majority of the Indian population still remains unbanked. Financial inclusion has been viewed as important means to enhance economic growth and counter income inequality by increasing access of the poor to formal financial services.These need to come at affordable costs to the underprivileged, who might not otherwise be aware of or able to afford these services. Unfortunately, over 96% of Indians are still oblivious to the benefits of insurance. There are multiple reasons for low adoption of
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The survey indicated the lack of awareness and a clear understanding of the benefits that get accrued in case of any eventuality. Customers, especially in rural parts of the country need to be educated and there has to be a mind-set change for higher adoption of insurance.
Driving financial inclusion:
As part of its agenda to deliver financial services at affordable costs to vast sections of underprivileged and low income groups, the government has taken lot of proactive steps. Micro insurance schemes like
Corporates like Telenor have taken the lead by massyifying insurance. The approach has been extremely innovative. It combines the distribution reach of a telecom operator with mobile technology to offer free life cover to its subscribers.
A mobile subscriber can now use his mobile device – feature phone or smart phone – to enrol for the insurance offer. Today, an insurance product can be subscribed by dialling a simple USSD code or giving consent over the
Families with a low income hardly think of getting an insurance done because of the high premium rates. They feel they’d rather spend the same amount on something which is more productive or gives instant returns. Telenor recently launched an initiative to spread the message of securing lives among its customers by reaching out to students in the schools across the country and making them understand the benefits of insurance. Propositions where insurance becomes add-on to a regular service, in this case mobile talk time, makes it more attractive for customers. And if it is for free, it is even better.
While the government is coming up with various initiatives in order to make digital India a reality and the society in general is moving towards a cashless economy, distribution of easy to adopt financial products digitally will be key.
(This article is authored by
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