Online Insurance – Good or Bad…!!!

Internet is the buzz word these days. It is the virtual world where one can shop, meet people, find a job, play games and what not! Indians are one of the largest users of Facebook; we are also witnessing a ferocious growth of e-commerce market which is active with mergers and acquisitions. These are some credentials that the internet can boast about. To add further to it, even banking has taken the internet way and so have the insurers. As insurers, from the initial baby steps with only simple term products, the industry is now exploring the online market for slightly more complex endowment products and a variety of other products with a combination of riders. All this is available at just few clicks.

If we spend more time on internet then why not explore it as a medium to buy insurance policies too? Of the several activities done on internet, searching and analyzing financial product and insurance is a major one, all thanks to the information available at a simple search, with reviews and comparative data readily available. One of the biggest advantages of an online policy is the reduced cost of it, owing to lower distribution cost and nil-commission. That said, buying a policy online is a much simpler method which can be undertaken conveniently. Insurers offer a range of facilities like cover and premium calculators along with several products that customers can choose from. In short it is not only cost effective but convenient.

Few things that a customer must bear in mind are procuring correct medical data and other documents, to ensure that the insurer processes the policy faster. This also helps in quicker claim settlements later. Perhaps, the only thing which is offline in the entire process is the furnishing of medical test results. Factors like consumption of tobacco/alcohol or a pre-existing medical condition make a difference to the cover you get, hence the premium you will pay.

Besides this, insurance companies have online helplines that can be approached for any information related to the policy purchase, making it a very cost effective and time effective proposition. Since the consumer makes a well-researched decision of buying a policy after providing the authentic details, the risks are minimized to a greater extent and helps in generating faster claim settlement. Insurers have become prudent in developing products keeping the internet consumers in mind. However, it is advisable for customers to not withhold any medical information in a bid to lower premiums. The products are designed to offer best benefits only when the information provided is correct.

In nutshell, buying a policy online works out to be a better channel; be it for a simple life cover or a complex one. As internet penetrates further, consumers will gradually resort to purchasing life insurance policies online. It only makes more sense, given that most of the chores are being done online.

Originally written by: TR Ramachandran, Aviva India.