Digit In­sur­ance

Banking Frontiers - - Housing Hihglights - Mo­han@bank­ingfron­tiers.com

Digit In­sur­ance is a Fair­fax backed in­sur­ance com­pany that com­bines eCom­merce and in­sur­ance. Vivek Chaturvedi, head-Mar­ket­ing, out­lines how unique the com­pany’s of­fer­ings and its ap­proach to cus­tomers are:

N. Mo­han: Digit In­sur­ance seems to have com­bined eCom­merce and in­sur­ance. Can you out­line the ge­n­e­sis of the con­cept and how it is vi­able in the highly com­pet­i­tive en­vi­ron­ment in In­dia?

Vivek Chaturvedi: Digit’s mis­sion is to ‘Make In­sur­ance Sim­ple’. And the big­gest rev­o­lu­tion that eCom­merce as an in­dus­try has brought to the In­dian mar­ket is the fact that it has sim­pli­fied the en­tire pur­chase jour­ney for peo­ple. Right from a pin to an air­plane ticket, ev­ery­thing can be bought on­line, from any­where. Sim­i­larly, our idea also is to sim­plify the en­tire jour­ney for peo­ple. Though in­sur­ance and sim­plic­ity may sound like an oxy­moron but that’s what we’re gun­ning for.

From our pol­icy doc­u­ments to our terms to our pro­cesses, we have made sure that the pain points for cus­tomers are re­duced. So, if you see our pol­icy doc­u­ments, you will find that we have used sim­ple to un­der­stand English and have cre­ated 2-pager sum­mary doc­u­ments that have ev­ery­thing you def­i­nitely need to know about your pol­icy. The in­tent here is to make the terms so sim­ple that even 15-year-olds get it. From a prod­uct point of view, we have cre­ated mod­u­lar prod­ucts that peo­ple can choose from with claim terms that are re­ally ben­e­fi­cial to peo­ple in times of need. Even from a claim process point of view, we have made it seam­less for peo­ple. We have a phi­los­o­phy of hav­ing zero hard­copies, au­to­mated pro­cesses as far as pos­si­ble, in­clud­ing self-in­spec­tion through the cus­tomers’ smart­phones that fas­tens the claims process over­all.

Also, we have made sure that peo­ple can buy our prod­ucts from which­ever chan­nels con­ve­nient to them, whether it is on our web­site or while they are mak­ing a pur­chase of prod­uct through one of the eCom­merce por­tals and they would want to in­sure the prod­uct, or through our 1500 strate­gic part­ners (agents & bro­kers). All of this has made us cross 4 lakh cus­tomers to­day with a pre­mium of Rs2 bil­lion.

How dif­fer­ent is Digit In­sur­ance from the tra­di­tional players? What makes the com­pany stand apart?

In terms of dif­fer­en­ti­a­tion, one could ob­vi­ously point to the way the prod­uct is built. Our phi­los­o­phy on that is to make it as rel­e­vant as pos­si­ble for each cus­tomer rather than stan­dard­iz­ing a prod­uct. Our goal is to in­crease the rel­e­vance of the in­sur­ance prod­ucts and hence the ben­e­fits are de­signed so that cus­tomers can ex­pe­ri­ence the claims. We have turned all the per­ceived ben­e­fits into ac­tual ones. For ex­am­ple:

• 75 min­utes flight de­lay cover at Digit vs 6

hours flight de­lay cover

• De­fined fixed ben­e­fit for de­lay or loss of

bag­gage (as against re­im­burse­ment) • IMEI cover for mo­bile phones • World­wide cover and no de­pre­ci­a­tion for jew­elry

Our self-in­spec­tion process for mo­tor claims helps the cus­tomers to em­power them­selves through ad­vanced cash and fast claims.

An­other dif­fer­en­ti­at­ing fac­tor would be on the pro­cesses side. In a way, we are trans­mit­ting in­for­ma­tion or com­mu­ni­cat­ing with a cus­tomer. In­ter­ac­tions be­tween busi­ness part­ners and us on pol­icy is­suance, quotes, doc­u­men­ta­tion and others will be more on a real-time ba­sis and dig­i­tal, than be paper-fo­cused.

Which are the ma­jor prod­ucts that are on of­fer?

We are cur­rently pro­vid­ing in­sur­ance in 5 ver­ti­cals - car in­sur­ance, 2-wheeler in­sur­ance, mo­bile in­sur­ance, travel in­sur­ance and in­sur­ance for jew­elry. We en­sure that our plans can fit any wal­let size and can be cus­tom­ized ac­cord­ing to the most im­por­tant needs.

Can you ex­plain the ef­forts that have gone into in mak­ing the prod­ucts sim­ple and for the cus­tomers so easy to un­der­stand?

We wanted to de­sign pro­cesses that work for hon­est cus­tomers and de­liver a ser­vice we would be proud of. As a part of com­pany’s mis­sion of mak­ing in­sur­ance sim­pli­fied, we drafted the in­sur­ance fea­tures

into a 2-pager sum­mary that en­cap­su­lates ‘What is cov­ered’, ’What is not cov­ered’ and im­por­tant de­tails about the claims process. And to see if we suc­ceeded, we de­cided to go through a tor­ture test. We tested our sum­mary doc­u­ments with 15-year-old kids and checked their un­der­stand­ing. This is from the point of view that if the 15-yearolds un­der­stand them, adults def­i­nitely will. The ap­proach that we took to build the con­cept of ‘Sim­pli­fied In­sur­ance’ is:

Set­ting the right team: To break away from the usual, you need to cre­ate a team with the right mix of peo­ple ie, peo­ple who can bring the power of ex­pe­ri­ence and knowl­edge from that field and peo­ple who can bring in fresh per­spec­tives and can chal­lenge the norms. We be­lieved in hav­ing teams that have mem­bers from di­verse field of ex­per­tise. Tak­ing this for­ward, we hired em­ploy­ees not only from the in­sur­ance sec­tor but those with non-in­sur­ance back­ground as well such as eCom­merce, among others.

Go­ing the pa­per­less way: We wanted to dis­rupt the in­sur­ance in­dus­try by go­ing com­pletely dig­i­tal for which we had to set up sys­tems from the scratch. For us, brain­storm­ing was into tech­nol­ogy, net­work for ser­vice providers like garages, phone work­shops. Claim­ing to be a tech­first com­pany does not come that easy, which is why we chose to go 100% on cloud, and we are proud that we are the only BFSI com­pany in In­dia to do so.

Can you speak about the cus­tomer base of the com­pany? How unique are your cus­tomers?

We have crossed the mile­stone of 400,000 cus­tomers. With a wide ar­ray of af­ford­able prod­ucts on of­fer, our cus­tomers range from a stu­dent who buys a mo­bile in­sur­ance to an in­ter­na­tional trav­eler who takes up an in­sur­ance for ad­ven­ture sports.

Which is the prime dis­tri­bu­tion chan­nel agents? Can you give de­tails?

We are mak­ing sure that peo­ple can buy our prod­ucts from what­ever chan­nel is con­ve­nient to them, whether it is on our web­site or while they are mak­ing a pur­chase for the prod­uct they would want to in­sure on one of the eCom­merce por­tals, or through our 1500 strate­gic part­ners.

Do you have any tie-ups with other fi­nan­cial ser­vices in­sti­tu­tions like banks to sell the prod­ucts?

No, we do not have such tie-ups.

What is the level of tech­nol­ogy in­duc­tion in the com­pany? Can you give an out­line of the tech­nol­ogy back­bone and how unique it is com­pared to other in­sur­ance com­pa­nies?

We have a few core be­liefs. We are a 100% cloud-based com­pany. We be­lieve in build­ing a com­pletely dig­i­tal and pa­per­less in­sur­ance com­pany.

We be­lieve firmly that claims are not bad and to en­sure that cus­tomers feel the same way, we have sim­pli­fied our claims process. We dis­rupted this process by in­tro­duc­ing our pre-in­spec­tion app that tells our cus­tomers to self-in­spect and take pic­tures for our doc­u­men­ta­tion. We have dras­ti­cally re­duced the in­spec­tion time to min­utes vs days with this.

We have a lot of au­to­ma­tion built in our sys­tems. The bots in the soft­ware can go through the huge amount of data we get and turn around the in­sights at a very fast speed, which helps us ad­vise our cus­tomers eas­ily.

Your in­sur­ance doc­u­ments were given to 15-year-old and tested, can you throw some light on that?

When we were de­sign­ing our prod­ucts, we were on a mis­sion to make in­sur­ance sim­ple. While we could not elim­i­nate some of the ba­sic terms and con­di­tions, we tried re­mov­ing un­nec­es­sary jar­gons that only lawyers would un­der­stand and re­placed it with easy word­ings.

We also in­tro­duced a 2-page sum­mary doc­u­ment that en­cap­su­lates ‘What is cov­ered’, ‘What is not cov­ered’ and im­por­tant de­tails about the claims process. Cus­tomers can read them and get ev­ery­thing that they def­i­nitely should know and that too in a very com­pre­hen­si­ble lan­guage.

In or­der to see how well we suc­ceeded at our at­tempts, we thought of test­ing our doc­u­ments with kids aged 8-15 years to see if they un­der­stood our doc­u­ments. While all age-group kids un­der­stood the sum­mary of doc­u­ments, we scored a 100% with 15-yearolds un­der­stand­ing our doc­u­ments.

Our next goal is to be un­der­stood even by a younger set.

What was the logic be­hind test­ing your process doc­u­ments on a 15-year-old who we un­der­stand have al­most no knowl­edge on in­sur­ance, their prod­ucts and of­fer­ings?

We knew that in­sur­ance con­tains lots of terms and con­di­tions and words and jar­gons that only in­sur­ance lawyers could un­der­stand. Since we were fol­low­ing our vi­sion to make in­sur­ance sim­pli­fied and claims process sim­pler, we came up with an idea to re­duce the in­sur­ance doc­u­ment lan­guage so sim­ple that even a teenager should be able to un­der­stand it. Al­though we un­der­stand that a 15-year-old will not in­vest in an in­sur­ance prod­uct, we wanted to test our ef­forts.

Vivek Chaturvedi ex­plains how the pol­icy doc­u­ment is made sim­ple and can be un­der­stood by even 15-year-olds

Prem Watsa, founder, chair­man & CEO, Fair­fax Fi­nan­cial Hold­ings, with Kamesh Goyal, chair­man Digit In­sur­ance

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