While the Coronavirus pandemic has adversely impacted and disrupted most insurers, it has had a positive impact on Edelweiss General Insurance, which has recently completed 3 years of operations. Starting out as a digital native, the transition was easy for the company since it had already digitialised most business processes, says Shanai Ghosh, Executive director and CEO of Edelweiss General Insurance (EGI).
“We were working very much the pre-pandemic way but we were working from our homes. The pandemic wasn’t really much of a disruption for us and I think it was a validation for a digital platform. We were able to continue business uninterrupted. So last year was actually a good year for us,” Ghosh adds.
While the private GI industry grew at an average of 5.1 per cent in FY21, Edelweiss General Insurance registered a growth of 49 per cent in premiums in FY21 over the previous year.
Ghosh says that when the general insurance industry saw de-growth in motor insurance with most vehicles being off the road during the lockdown, Edelweiss GI registered a growth of 40-45% in the motor insurance segment primarily in the private car segment.
The company launched one of the first on-demand digital motor insurance products, which allows the customer the freedom to switch off the insurance if they are not using the car.
“Today’s customer wants customized solutions and products that are completely tailor-made to their needs. This product allowed them to not pay for insurance when they were not using the car. This was particularly useful last year because when we launched it in May, there were conversations and questions around.”
Covid claims impact
The two waves of Covid in India have burdened the general insurance industry with a flood of health insurance claims. Ghosh says that Edelweiss GI also was also impacted by increasing claims since it is heavily invested in health insurance since inception.
Incidentally, before the insurance regulator asked health insurers to launch Covid-specific covers such as Corona Rakshak and Corona Kavach, Edelweiss GI had written to the regulator for waiving off the waiting period for Covid. This meant providing coverage for Covid from day zero for any customer who buys a regular health insurance policy. The insurer also launched awareness campaigns regarding Covid19 coverage under regular health insurance policies.
“In our regular health insurance policy, we also reached out to customers when we realized that some of them were not adequately informed about COVID 19 coverage. We saw that people who buy health insurance are often unaware of what the product covers. In that way we invited some claims but that is our approach. We would rather err on getting customers and giving them a better experience and be absolutely transparent. Even if it means getting claims in the bargain we would rather be sure that we are proactively reaching out to customers.,” said Ghosh.
But doesn’t this leave the insurer open to frauds? Ghosh says while not too many claims came in the first 30-day period, but it really gave customers the confidence to go and buy the policy.
The company proactively identified signals of fraud, launched investigations and was able to check a lot of frauds.
“If there’s an intent to commit fraud, there is always opportunity to do so. So we, as insurers, always have to be vigilant, not just in COVID times when there was a peak in terms of fraud for at least reimbursement cases but always,” she said.
Digital Distribution approach
In terms of distribution, Ghosh says the company has learnt from the experience of incumbents, and adopts an omni-channel approach which operates completely on the digital platform. “So, we have agency point of sale, but the entire process is 100% digital right from on boarding to sale service.”
While the company does end up losing some partners due the enforcement of the digital process but Ghosh feels that it is the differentiation and a path that the company has to take.
Also, the insurer has tied up with new-age players in the growing internet economy and sells customized niche bite-size products on platforms such as Cleartrip, Ola etc.
“We’ve been creating a new alternative distribution by leveraging the internet economy for which we have got many partners,” Ghosh says.
“That gives us access to a lot of customers to whom we can ultimately upsell and cross-sell mainline health and motor insurance products. For each of these channels the product strategy is different because each product has its own sales, behavior, selling approach,” she adds.
Ghosh says the company is focusing on offering a completely digital experience and convenience to the customer and so if a claim is triggered on these platforms, the amount iis automatically paid to the customer.
Trying to solve the perception issue in insurance
The gap in insurance, which is a highly underpenetrated sector in India, is due to the belief that the industry is opaque. Besides, there is anxiety about the excessive documentation for claims.
“I would say there’s so much anxiety around the claims process,” she said.
And that’s where Ghosh feels the company has the opportunity to provide a digital seamless claims experience to its customers and do things differently. The company has integrated Net Promoter Score (NPS), a tool to measure customer loyalty into all its processes.
“The attempt is to make insurance friendlier, easier and more transparent than it’s currently perceived. We closely track the customer experience through monitoring NPS real time dashboard so that we can work towards constantly improving our claims experience,” she adds.
Edelweiss GI is completely owned by Edelweiss and does not have a foreign partner. Ghosh says that its current capital needs are completely met.
Ghosh feels that the growth for the industry in the current year will not be easy because while health insurance has witnessed a surge in sales, with the fall in Covid cases, the industry also has seen a consequent dip in sales of health insurance policies, the only segment which has seen a surge in growth during the pandemic. While this fiscal won’t be ‘cakewalk’, she expects Edelweiss GI to deliver another year of robust growth
(Deepa Nair is a Mumbai-based journalist specialising in finance and international affairs.)