Weekly Insurance Round-up Tuesday, August 10, 2021
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We're back with the 2nd edition of Beshak's Weekly News Round-up - an analysis of all Insurance News & Updates from our in-house research team.
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- Enable Autopay through UPI for insurance premiums 🏦
- Legacy insurers withdraw from online marketplaces. 💻
- 75% individuals nearing retirement don't have adequate health insurance ☔
- Onsurity gets a $16 million Investment 💰
- Delays in processing Covid19 claims puts families in debt 😥
- Insurance customers can now put standing instructions or AutoPay options for a payment frequency suitable to them, using UPI apps like PayTM, PhonePe, GooglePay.
- ICICI prudential recently became the first insurer to enable UPI autopay with NPCI (National Payments Corporation of India).
- With this feature, paying recurring premiums will become more convenient.
- Also, since UPI payments are linked to bank accounts (and not credit or debit cards) there are less chances of missed payments when the card expires.
Source 📌: The Hindu Businessline
- The Economic Times carried a feature story on large insurers delisting from aggregators like Policybazaar. HDFC Ergo has delisted its health and motor products from online web aggregators and many third party brokers, joining a small band of traditional insurers like ICICI Lombard and LIC of India to move away from online aggregators.
- It is reported in this article that insurers do not want to tarnish their brands by being compared on these sites merely on pricing. Moreover they want to reduce the dependency on third party platforms, grow and nurture their own self-sufficient distribution models.
- The flagship products from HDFC Ergo, ICICI Lombard - some of them being very popular products, will now be available only through their own website, apps, and offline distributors like insurance advisors and banks.
- Financial Advisors and users can instead now use the Beshak⭐Ratings to compare products (currently available for Term Insurance) on parameters other than just the price before making an unbiased decision about which product to purchase. This will help them find the ranking of the products purely on the basis of their quality with 100+ features and benefits compared.
Source 📌: The Economic Times
- As per the survey done by Bajaj Capital it was found that 75% of people who were retiring did not have sufficient health insurance. The survey was conducted with 799 respondents, who were retiring in as few as 18 months.
- The Covid19 pandemic has thrown light on the importance of having an insurance cover (both from a health insurance and life insurance standpoints) and brought people to realise the fact that it is dangerous to not have a sufficient insurance cover. As a result, there has been a tremendous increase in the demand for these products.
- Further, people have also become generally more aware of and concerned about the need for specific types of covers such as OPD coverage or critical illness coverage, after seeing the heavy burden families have faced towards these expenses in the last two years.
- In this direction - this survey reported that 47% of the soon-to-be retirees did not have OPD covers, and 63% did not have a critical illness cover, which might become very unaffordable for them to buy as they age further.
- Further, 90% of them realised that their current covers were not adequate and were planning to upgrade their covers soon. However, in light of insurers becoming more stringent in providing new covers or upgrades (especially to high-risk populations, such as those nearing retirement age) - these upgrades might become difficult or unaffordable, leaving a majority of seniors without sufficient covers.
- The findings of this report, if representative of the nation-wide market, are alarming. There is an urgent need to educate, spread awareness amongst the general public about the growing cost of hospitalization in the country and the affordable options available for senior citizens to insure themselves from the possibility of large hospitalizations wiping out their retirement savings.
- $16 million was raised by Onsurity, a health benefit startup in a Series A funding round which was led by Quona Capital, Nexus Venture Partners and Whiteboard Capital.
- The technology backed group health insurance space has seen some really strong interest from venture capitalists.
- Onsurity joins Plum (that raised an investment of USD 15.6 Million from Tiger Global) and Nova Benefits (that raised USD 1 Million from Better Capital, Multiply Ventures & Titan Capital) becoming the next group health insurance startups to raise funding recently.
- With this kind of capital, the group health space specifically catering to tech-startups will see intense competition and short to mid-term disruption in terms of the products they offer their audiences.
Source 📌: The Economic Times
- ETNow reported that Insurers are delaying claims, and the news is going viral and causing panic amongst customers.
- The report states that 330,000 claims worth Rs 10,603 crore are still outstanding with the insurers, while 49,452 Covid-19 claims worth Rs 389 crore were rejected for various reasons in FY22.
- The report also states that insurers are not paying claims on critical illness policies that were sold by banks along with loans, citing the terms & conditions of the policy.
- As you are aware, Critical Illness policies traditionally cover only a specific list of illnesses that are mentioned in the policy document. Often these include serious illnesses like the First Heart Attack, Third stage Cancer, Paralysis etc.
- As a result - Covid19 has not been covered under Critical Illnesses.
- Further, these policies come with a condition of ‘Survival for a certain period of time’, after the diagnosis of the disease. This is because these plans are designed to cover the financial impact of surviving a serious disease (and not death as a result).
- In fact, we have covered these insights in great detail in our Free Critical Illness Guide.
- In view of these new insights, customers should be educated about -
- Covering the financial risk of death, including the risk of large debts on the heads of family members through a Term Life Insurance policy.
- Covering the financial risk of surviving a Critical Illness, through a Critical Illness policy. This ensures that the costs, and losses incurred (that are not under the scope of a health insurance policy) are covered.
Source 📌: ETNow News
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