Online jaane mein hi samajdari hai!

Mumbai  Delhi Airfare available at 40% discount offer available only if bought online from the company’s website only.

I bet this headline got your attention. Whilst this headline may not be real, companies in different sectors are using the power of the Internet to reduce costs and offer great deals to its customers. In fact though this is not widely known, something similar exists in the world of personal finance as well.

This is most evident in the pure risk based,Insurance,policies (Both life and non-life).

Nowhere is it more evident then in Health, Auto and,Travel Insurance,. Some of the top private firms that offer these products to be bought online are ICICI Lombard, Bajaj Allianz, Reliance General, Tata AIG (travel policy only), Cholamandalam (Car policy only) and Royal Sundaram, etc. Even a PSU  like Oriental Insurance is now offering its retail policies online. A big benefit of buying these policies online is that in the case of policies such as,Car Insurance
the consumers can see best rates that these companies offer as internet is a transparent mechanism and they need to offer the best rates to make sure the consumer does not go away. Best of all you can buy at any time during the day (travel policies have been bought by travellers even as he  is in the lounge of the Indian airport waiting to board his international flight). Also, most of these sites offer a 24/7 chat facility to enable you to clarify doubts there itself.

But the biggest benefit is that you can do an overall comparison of features and prices across various insurance companies online on sites such as,www.apnapaisa.com,or,www.policybazaar.com,and then buy the policy that best suites you. This is not to say that the online experience cannot be bettered. Firstly there are irritants such as some of the online buy pages not working on browsers other than Internet Explorer. Secondly some benefits that are available in the off line world are not available in the buy online option due to fraud control requirements. A good example is the practise of some companies to not allow shifting your no claim history from the old car to your new car even though the same company offers it in the offline world. But such disadvantages are far and few and the immediate advantages are substantial enough for most consumers to go online. A good example would be those buying,health insurance,policies at the last minute before March 31, 2010 for tax reasons (health policies should never be bought for tax reasons alone but that is a different story). It is possible to instantly get the digital copy of the policy in your mailbox even in the evening of March 31.

The offers on the online,life insurance,market are relatively fewer as compared to the non life market, but are now increasing at a fast pace. For example Aegon Religare has recently come out with its iTerm policy which is a low premium pure risk term life policy. Depending on the age, tenure and value of the policy it is cheaper by at least 7% to around 40% from the next best term insurance. This policy is not available through the company’s agents and payment for this policy has to be made online on the company’s website only. My talks with Yateesh Srivastava, Chief Marketing Officer, Aegon Religare Life Insurance revealed that the company has been pleasantly surprised by the overwhelming response this product has received from the public without having incurred any significant marketing expenses.

Similarly Bajaj Allianz offers its iGain ULIP policy exclusively Online. This policy has lower charges than comparable policies from its own stable. In a conversation,  Ms. Mahima Tankha, Head  Web Sales, Bajaj Allianz said,  We were pleasantly surprised at the positive response that we have received for this product especially from the smaller towns of India.

One of the advantages pointed out in the study from the consumers who have availed this product reveal that some of these consumers like the self service option where they can research and buy the product online, without having to face the high pressure sales personnel/ insurance agent.

HDFC Standard Life offers online purchase for 3 of its plans and offers the benefit of lower charges for customers buying online. Other companies are now following suit. ICICI Prudential Life insurance and Reliance Life Insurance now offers the online purchase option for some of its insurance plans, though unlike Aegon and HDFC Standard Life, these plans are available through their agent network as well.

Disclosure: Most of the insurance companies and products discussed here could be advertisers with Apnapaisa.

Even if you are not comfortable buying an insurance product without talking to a human being, the possibilities of doing proper research and comparison before you buy the product of your choice should make it mandatory for you to use this medium when you next want to buy an insurance policy.

 

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