What are the Digital Trends in Term Insurance?

Securing your family’s financial future is a paramount concern. This is where a term insurance plan plays a crucial role. Essentially, it is a safety net that promises financial security to your family in your absence. The primary reasons for availing a term insurance plan are manifold – 

⮚  Debt protection

It helps in covering any outstanding debts or loans, preventing the financial burden from falling on your family.

⮚  Financial security

It ensures which your family remains financially stable, even if you are not around to provide.

⮚  Flexibility

It allows you to customise the coverage term and payout mechanism to meet your specific needs.

⮚  Affordable

Term insurance policies are inexpensive, providing ample coverage for comparatively cheap rates.

⮚  Tax advantages

Aside from the protection component, term insurance provides tax benefits under several parts of the Income Tax Act, making it a wise financial choice. Now, let’s look at the digital developments that are altering term insurance coverage. – Understanding digital developments in term insurance plans.

⮚  Customised web portals

Insurers increasingly provide user-friendly websites where clients may purchase and manage insurance. This involves updating personal information, paying premiums, and submitting claims.

A large insurance firm provides an online site where consumers can log in, examine their policy details, and make adjustments if necessary. For instance, if a policyholder gets married or has a child, they can easily update their nominee details online. They can also view their premium due dates and pay online, avoiding late fees and policy lapses.

⮚  Online term insurance calculators

These online term insurance calculators have revolutionised the process of selecting the right term insurance plan. By inputting basic information, individuals can quickly estimate their coverage needs and premium amounts, making informed decisions much easier.

Consider a 30-year-old individual looking to buy term insurance. By using an online calculator, they can input their age, annual income, and desired coverage period. The calculator might suggest a coverage of 20 times their annual income, considering their age and liabilities. It also estimates the premium based on these inputs, simplifying the decision-making process.

⮚  AI and chatbots

Artificial Intelligence (AI) and chatbots are increasingly being used to provide 24/7 assistance. They help in answering queries, offering policy recommendations, and even assisting in the claim process.

An AI-powered chatbot on an insurer’s website can interact with potential customers. For instance, a user unsure about the type of term insurance suitable for them can chat with the bot. The AI bot asks a series of questions about their lifestyle, financial obligations, and family structure and then suggests the most suitable term insurance plan, along with explanations.

⮚  Mobile applications

Insurance firms are creating mobile applications to provide a smooth customer experience. Customers may use these applications to buy insurance, pay premiums, and check the status of their policies while on the road.

Customers may buy term insurance straight from an insurance company’s app on their smartphone. They may explore several plans, utilise built-in calculators to estimate their coverage requirements, and purchase a policy using the app. They may also set up premium payment reminders and pay straight through the app.

E-KYC

E-KYC streamlines policy issues by eliminating the need for physical papers, resulting in speedier and more efficient verification processes.

A new consumer can enrol in a term insurance plan and complete their KYC digitally. They upload their Aadhaar card and PAN card images through the insurer’s app. The e-KYC system verifies these documents against government databases, enabling quick policy issuance without physical document submission.

⮚  Telemedical check-ups

To make the process more convenient, insurers are adopting telemedical check-ups where possible, reducing the need for physical medical examinations.

A policy applicant schedules a telemedical check-up through the insurer’s website. A healthcare professional conducts a video call to assess the applicant’s health status, asking questions about their medical history and lifestyle. This process eliminates the need for a physical visit to a doctor’s clinic for basic health assessments.

⮚  Secure online payments

The integration of secure payment gateways has made the process of paying premiums online safe and hassle-free.

When a policyholder pays their premium online, the insurer’s portal directs them to a secure payment gateway where they can choose or opt for their preferred payment method – credit card, debit card, net banking, or digital wallets. The transaction is encrypted, ensuring the customer’s financial details are safe.

⮚  Social media engagement

Insurers are actively using social media platforms for customer engagement, awareness campaigns, and even for addressing grievances.

An insurance company uses its Facebook and Twitter accounts to interact with customers. They post about the importance of term insurance, answer queries in the comments, and even host live Q&A sessions. They also use these platforms to address customer complaints, providing a quick and direct line of communication.

⮚  Data Analytics for Personalised Plans

Insurers are using data analytics to understand customer needs better and offer personalised term insurance plans.

By analysing customer data, an insurance company identifies that individuals in their 40s often look for higher coverage plans due to increased family and financial responsibilities. Using this insight, they tailor their communication and product offerings for this demographic, suggesting plans with higher coverage and specific riders beneficial at this life stage.

⮚  Digital claims processing

With digitalisation, claim submission and processing have become quicker and more transparent.

After the unfortunate demise of a policyholder, their nominee can file a claim online. They upload the necessary documents, such as the death certificate and policyholder’s ID proof, through the insurer’s portal. The insurer processes these digitally, enabling quicker verification and claim settlement.

Ending note

Digitalisation in the term insurance sector is not just a trend but a revolution that is making insurance more accessible, affordable, and tailored to individual needs. It empowers you with the right tools and information to make informed decisions about your financial future. In our country, where family is the basis of society, securing your family’s financial future with a term insurance plan is not just a wise decision but an act of love and responsibility. Adopt these digital advancements and take the first step towards safeguarding your family’s tomorrow and today.