Tech transforms Indian insurance: From embedded to personalised protection​

insurance

• Technology is making insurance in India more accessible and affordable
• Embedded insurance is expanding coverage and simplifying user journeys
• Insurtech firms have seen 10X revenue growth and $2.7B in funding in 5 years

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Insurance in India is transforming as technology continues to reshape how people buy, trust, and interact with financial protection. It is essential to understand how Indians are actually enrolling in insurance plans and what changes have occurred over the last decade or so in their decision-making process. What role is technology playing in shaping the Indian insurance ecosystem, and what separates a good platform from a great one in such a dynamic market?

One can segment the entire target customer population into three cohorts. First is the set of people who are automatically enrolled in insurance by virtue of being a part of an organisation, a process, or a transaction. They may obtain insurance from the government, be insured by their employer, or be insured de facto through products they purchase or services they use. For example, in India, when you travel by train, you are offered train travel insurance, which is embedded in the purchase journey of a train ticket. That is one type of group where people are provided with insurance at the relevant touch point, even if they aren't proactively seeking it. The other set of population is those who willingly and on their own accord pursue the interest of buying insurance. Then they reach out to an insurance provider, which could be an insurance company or an intermediary, and that is the other set. There is, of course, a much larger third cohort - those who are unaware of insurance and its benefits.

Over the last decade, the first two categories have seen growth in both volume and value. And that’s the most interesting thing about how insurance has evolved in India: both the awareness of the ecosystem that provides insurance to its stakeholders and the understanding of the ecosystem itself have increased. The government has invested more in providing insurance to the country's citizens. There is a current sense of optimism among policymakers and investors, as economic conditions have improved (2% lower than earlier, according to the RBI’s estimates) due to a range of factors, including stronger exports, rising consumer spending, insurance uptake and increased private investment in the Indian market.

Role of new-age technology

Over the last few years, there has been a significant shift in the insurance industry’s appreciation of what technology can do for the sector as a whole and how insurtech companies can help accelerate the industry's strategic growth. Most tech interventions can be classified into two major categories: those that drive efficiency, speed, and cost, and those that drive impact on premium development. Until a few years ago, most tech interventions in the Indian insurance industry were aimed primarily at improving efficiency. However, COVID-19 led to a shift in thinking, and there has been increased demand for creating new products, building contextual and bite-sized products, and expanding distribution, all with support from insurtech firms.

Enhancing customer experience and access

With rising disposable incomes, growing financial awareness, and the basics of food and housing now secured for a large segment of the population, more consumers are turning their attention to long-term financial planning— creating fresh opportunities for the insurance industry. The next phase of growth lies in converting those who need insurance into those who actively intend to enrol on an insurance plan. To achieve this, insurers are leveraging technology to identify new customer channels, design flexible products, and set price points that reduce purchase friction. As financial inclusion expands, people who are accumulating assets, such as homes and vehicles, are increasingly experiencing the benefits of embedded insurance and seeking to upgrade their coverage beyond physical assets to their own health and life. Reflecting this shift, insurtech firms are collaborating with leading health insurers to introduce innovative solutions across the board. Customised and contextual offerings not only enhance adoption rates but also deepen customer engagement across emerging market segments.

Government’s role in supporting fintechs and insurtechs

Financial inclusion has been a theme of the Indian government over the last decade or so, and if you look at financial inclusion or adoption metrics for any fintech or digital intervention globally, India would be at the top of the pyramid. This financial inclusion has led to an explosion in the consumer economy, providing all the more reasons for the government to focus and invest in the insurance sector.

Embedded insurance is emerging as a transformative force in India’s evolving digital financial landscape. By integrating insurance offerings directly within the purchase or service experience on digital platforms, insurtech firms are lowering distribution costs, simplifying user journeys, and expanding coverage to previously underserved demographic groups. Embedded investment models are also playing a crucial role in democratising access to capital markets, especially for first-time investors from Tier-2 and Tier-3 cities.

Insurtech in India is finding its footing, making insurance more accessible and affordable in the world’s most populous country. Over the past five years, insurtechs have multiplied, with market revenues increasing 10X and over $2.7 billion in funding, demonstrating strong support for new and better insurance solutions tailored for Indians. Thanks to the tech-led disruption, buying insurance today is simpler and faster. .. In our fast-paced world, where time is scarce and speed is essential, a modest premium investment protects what matters most—securing your financial future. Insurtechs are leveraging technology to develop solutions that simplify the complex world of insurance.