There is a need for simpler products

There is a need for health insurance products that are simple and transparent,says Rajiv Jamkhedkar,MD and CEO of Aegon Religare Life Insurance which has recently launched an online health insurance product

There is a need for health insurance products that are simple and transparent,says Rajiv Jamkhedkar,MD and CEO of Aegon Religare Life Insurance which has recently launched an online health insurance product. Slowly the industry is moving from product-centric approach to customer-centric approach, he says in an interview with Ritu Kant Ojha of The Indian Express. Excerpts:

Why are we seeing a move towards establishing onlines sales channel by insurance companies?

Online channel offers value,convenience and access to customers. They are able to access company as well as products whenever they want. Customers are able to compare products and choose the best fit. Slowly people are getting comfortable with buying insurance online. That is why we are seeing increasing interest from insurance companies. Over the last three years,more than five lakh people came on our online platform and took a quote. Only a miniscule number out of those that take quote,actually buys insurance. However,slowly the number is increasing and a lot of it is due to word of mouth.

Most of the health products are quite complicated. Do you see need for simpler health products?

There is definitely a need for simpler and transparent products. As a customer,one needs a product that is easy to understand without any technical jargons and is transparent in its claims process. Slowly the industry is moving from product-centric approach to customer-centric approach and focus on simple products will only increase.

Insurance sector is going through a rough phase. Do you see any positives for the sector this fiscal?

It is too early in the year to comment about the entire year. The right time would be September after first half is over. However,it will never be as hectic growth as we saw in the past. The industry would grow given huge need for insurance but it will not be as fast as it was few years back.

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There was a gold-rush phenomenon when the sector was opened up in 2000 with no focus on rationalising costs. We saw shutting down of lot of branches in last 2 years. Is the era of high growth over?

The period from 2004 to 2007 was of high growth for the insurance sector. The financial crisis of 2008 was an eye-opener. Since 2008,companies have been rationalising their number of branches. Large players have cut down their branches big time. Companies have reduced their employee strength. Certainly the era of high growth is over and companies have taken corrective action.

Do you agree that agency model would gradually lose its relevance in India?

I still think agencies are relevant channel for a country like India where the penetration levels are really low. Insurance companies have to reach out to all segments of the society. India being a diverse country,local touch and local base of an insurance agent is a comfort for an average customer looking to buy insurance. So agency channel will continue for many years in India.