Pandemic spurs transition: Max Life Insurance’s digital efforts are paying rich dividends – The Financial Express
The life insurance major’s digital and e-commerce strategy has made it one of the largest private online protection providers in the country
After the pandemic hit India, the number of users opting for insurance online shot up dramatically. Some policy aggregators even reported that the number of users buying insurance online within a month of the pandemic’s onset went up by 40%, with a steady increase through the next 2 years, which saw growth rise up to 65%. With widespread adoption of several digital channels including UPI, large private insurance players are reporting increased growth in e-commerce sales and are evolving their digital strategy to capture market share.
“In the online protection space in life insurance, we focused on addressing the trust deficit by making claims simpler and improving underwriting. We added many digital product features through consumer insights which helped us get 30% market share in premiums across direct and intermediary channels,” says V Viswanand, deputy managing director, Max Life Insurance. According to him, digital enables consumers to do the procedures themselves, opening up an opportunity to tweak insurance products and customer journeys online. “DIY journeys, payment and fulfilment processes are all areas where consumers want to be in charge. It is a tremendous change from the conventional ways,” says Viswanand.
Currently, over 18% of Max Life Insurance’s new customers who are acquired every day are purchasing policies online. Out of this, 50% are mobile first customers and 65% purchase via aggregators like PolicyBazaar. The penetration of UPI applications which help discover policies is also a major factor behind this behavioural change. “The insurance industry is projected to grow at 25-35% online in the next five years, but we are aiming to boost our e-commerce growth to 35-50%, touching the Rs 1,500-crore mark by FY26. Today, we are the leader in protection purchase online but we also want to lead in savings,” says Viswanand.
While direct purchase from Max Life Insurance’s digital channels is at 35% today, it has been a tough journey over the last eight years as the consumer’s dependence on aggregators for policy comparison and domain knowledge has been high. “Direct sales is a different game altogether. On digital, it requires us to build domain authority,” he says. Building domain authority involves combining the consumer’s need to do things themselves with superior digital content. “We did the fourth edition of our protection cover survey across India recently , only to find out that 57% of digital consumers have inadequate cover. There is a huge opportunity for education here,” he says. “Those companies which lead in creating awareness and education will ride the wave of growth,” he adds.
Digital is also quickly making inroads into offline interactions. “We are asking our agents to ditch offices. We are taking our e-commerce strategy to their mobiles to make their work easier and more efficient,” says Viswanand. The company has created a library of modules for agents to learn and get certified from wherever they are. This translates into paperless, wet signature less quotation and an on-boarding system that the agents implement in the field. Around 15-18% of the overall spends at Max Life Insurance are on digital while 70% is on performance marketing.
“As a result, at the top of the funnel, we enjoy the top rank in life and term insurance and savings domains when it comes to SEO. At the bottom, our e-commerce is growing at 50%,” he adds. The digital initiatives have stemmed from the digital centre of excellence that was created within Max Life Insurance around eight years ago. “From an investment perspective, the salary costs of our operations and fulfillment teams have been flattish compared to our growing topline over the years. Had it not been for this investment, we would have struggled to operate in new geographies, new verticals or handle large volumes of consumers. That is the ROI from the digital centre of excellence,” he says.With LIC’s impending IPO serving as a confidence-booster, Viswanand expects even private insurance players to get listed. “In BFSI, banks have been getting most of the attention, whether it is from the stock market or in the form of government policies. It is time for insurance players now,” he says.
