Dear insurers, the first step to going digital starts with your own website

The coronavirus outbreak meant that 55-year-old Neha Chauhan could neither step out of her house nor could her insurance agent come home to collect the monthly premium. Chauhan decided to explore the online payment route for the first time and that is when she realised that this was way tougher than net banking.

Before paying the premium, Chauhan wanted to do a status check on her life insurance policy from a private insurer. But wait, she wouldn’t be able to do it without registering the policy on the website. For that, the website sought details of the policy number, premium payable, date of birth and commencement date. Sounds simple?

When she entered the details, the website showed an error message saying ‘unverified information’. She tried again. Same error. After five attempts, the system locked her out and she had to wait for 12 more hours before retrying.

The next time she tried another trick. For the premium payable section, she deducted the goods and services tax (GST) amount and tried again. And hey, it worked. Just that she had to try two more times before successfully enrolling the policy. Reason? The ‘captcha’ code seemed to show an error.

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After 24 hours, once her endowment plan was enrolled into the website under her personal login, Chauhan thought that it would be easy to check the benefits accrued and surrender value. But well, that wasn’t easy either.

Only the name of the policy and the premium amount was visible under the enrolled policy section. If she needed to view all the benefits accrued, she had to go for an e-insurance account with a registered repository. That required another round of KYC submissions and setting passwords, login. Chauhan decided against it.

With absence of staff because of the pandemic, a ‘friendly chatbot’ of the insurance company was available online to answer all the queries. Now, the problem here was that the bot wasn’t designed to answer specific questions and only had a list of 50 queries from which Chauhan had to choose from. Time elapsed? Two days.

She started getting worried about possible malfunctions closer to the premium due date so Chauhan decided to first pay the renewal amount in advance and later go back to checking policy accruals. The payment process was simpler but she never managed to get a renewal receipt.

Money was promptly deducted from her bank account but no acknowledgement from the insurer. The renewal amount was Rs 25,000 so she couldn’t afford to try another transaction and have almost Rs 50,000 stuck without further details.

Technically, the agent should have been able to help her procure a receipt within two to three days but he also seemed to be least bothered. “I’ll try. Will get it within a day,” was his response. Two weeks later, turns out that he forgot about this and has sought ‘some more time’. Time elapsed? Three weeks. Meanwhile, she also wrote to the company via email and social media.

Almost 25 days since her first attempt, Chauhan is now stuck with no receipt, no communication from the insurer and absolutely no information about whether her policy is in force/lapsed and what is the surrender benefit in case she wants to discontinue. Surrendering a policy would require her to visit a branch and fill up physical forms and this wasn’t a service provided online.

This isn’t an isolated incident faced by Chauhan alone. Seeking e-access to their own insurance policy can be a nerve-wracking experience for many in India. And the COVID-19 shutdown has only made it worse.

The sheer number of policies involved would give the public an idea about the gravity of the issue.

In FY20 alone, there were 28 million individual policies sold by the life insurance companies. This amounted to Rs 1.01 lakh crore of new business premium.

When it comes to total premiums (new plus renewals) while data for FY20 is not yet available, IRDAI data showed that for FY19 the total insurance premium for the life insurers stood at Rs 5.08 lakh crore and total individual policies in-force stood at 333.3 million.

Life insurers have never hesitated to wax eloquent about their ‘digital first’ strategy. However, Chauhan’s experience is a reality check on how the system works. What is needed is for insurers to walk the talk and enable the digital infrastructure for customers to enable atleast a minimal access to the product. Some lessons from the distance cousins, the private banks, can surely be learnt.

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