Internet businesses rush in as the pandemic widens insurance market
India’s burgeoning internet economy is slowly warming up to the potential of its massively underpenetrated insurance market. The country’s largest consumer internet platforms – from Flipkart to Paytm – are scaling up insurance businesses with the promise of low cost, low commitment and fully digital services as demand for risk coverage rises amid the Covid-19 pandemic. Ecommerce giants Flipkart and Amazon, ride hailing startup Ola, fintech players Paytm, PhonePe and Freecharge are selling diversified sets of policies — ranging from health, life, motor, and business risk — for customers and merchants through tie-ups with traditional insurance firms. Others such as Facebook-owned WhatsApp and Google are also learnt to be conducting pilot projects to gain expertise. Companies are currently shoring up partnerships, investing in technology and building resources to make a more informed foray into the insure-tech space, according to industry executives. “E-commerce recently enjoys a pan-India reach, reliability and efficiency – factors that are major drivers for any insurance product,” said Smrithi Ravichandran, Business Head – Payments, Consumer & Commercial Lending and Insurtech, Flipkart. The homegrown e-commerce giant partners with leading insurers on the backend, such as Bajaj Allianz, New India Assurance, Aegon Life and Go Digit to sell life, health, liability, and business covers. “There is a wider acceptance of consumers opting for these products on e-commerce as it offers them convenience and comfort, considering they rely on these digital platforms for their daily requirements as well,” Ravichandran said. Amazon, which sells insurance on its platform, has applied for an insurance brokerage licence, which will allow it to become an online aggregator and distributor of products. The Jeff Bezos-owned company currently partners with Infosys founder NR Narayana Murthy-backed general insurance startup Acko to sell a host of insurance products in the motor and liability segments. “We have seen a sea-change in how retail customers are approaching buying products and that will reflect in financial products too,” said Ruchi Deepak, co-founder of Acko.
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