• Introduction
• How platforms like Policybazaar help the average user?
• 7 Things to watch out for when buying from PolicyBazaar
  • One - How are products ranked?
  • Two - Which metrics are used to compare the best products?
  • Three - Are all products listed on the website?
  • Four - Is the entire transaction really online and seamless?
  • Five - Will Claims be Online? Who will support you for claims?
  • Six - Are you willing to deal with the spamming & chasing?
  • Seven - Are you getting Advice or Sales-talk?

Online shopping is convenient. You simply log into a website, compare your options, enter your payment details - and there you go, you’ve made yourself a purchase! When you decide to make a purchase online you skip the headache of facing the bustling city traffic and the need to endure long queues. You buy yourself something you want, from the comfort of your home - and what’s more, you also get great discounts, door-step delivery, and free exchanges if you don’t like what you got! Sounds fantastic right?

This is the exact experience that aggregator platforms such as Policybazaar and Coverfox want to create for the insurance space as well. By bringing several products - across product categories and insurance companies on one page, they want to make it easy and convenient for you to compare insurance products, choose customizations, and even make the premium payments without having to make the effort of visiting multiple insurer offices, collecting brochures, comparing manually, etc. 

In fact, we think that platforms like Policybazaar through their campaign have been the most ardent advocates of insurance as a product in our country, making outstanding contributions and improving awareness and accessibility. Owing largely to their efforts, individuals and families across the country are becoming better informed about health, life, and other insurance products that help them manage their financial risks better.

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Here are some ways in which online insurance aggregators have been making things better in the insurance ecosystem! 

• Many options, one platform: Most users that prefer aggregator platforms, do so because of the fact that they’ll get to explore many policies from many insurers at the same place. As long as the insurance company has a tie up with the platform - you’ll be able to explore their offerings and buy from the comfort of your home. 
• Comparison: With several insurance products listed side-by-side, aggregator platforms help you compare features, prices and value across all of them - on your phone or laptop. Imagine the effort this would need - if you were to physically visit branch offices, collect brochures and compare product benefits! Thanks to Policybazaar - anyone can compare insurance online today
• The online advantage: The world is digital. With increasing access to the internet across the country, online aggregators make it easy for you to purchase insurance in a few clicks - no matter where you’re located, and regardless of whether you can physically go to an insurer’s office or not. Skip the queues - simply buy from home.  Online insurance is also extremely helpful for families from tier 2 or tier 3 locations, where insurance companies might not have a branch office. Thanks to aggregators like Policybazaar - these geographical boundaries have disappeared, and insurance has become more accessible to everyone. 
• Great alternative when insurer’s digital presence is not optimal: We’ve heard from several users that they prefer online aggregators, to insurer websites - as the experience is smoother, and the systems more robust. Aggregator platforms have been quick to adopt new technologies and innovations that improve user experience - often before insurance companies themselves. 
• Paperless transactions: The benefits of going digital also include the fact that you’re reducing the dependence on hard-copy forms and documents. You no longer have to send a cheque to make a premium payment, you can simply do it online. And you no longer need to send printed/carbon copies of documents, forms - you can simply submit them online.  This not only reduces the impact on the environment but also improves access to the documents themselves. Just store them in a digital folder, share access with your family - and never lose a document again! 

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While there are these benefits to exploring your insurance on an aggregator platform, this coin too has another face. 

And if you have made a decision about buying insurance online through an aggregator platform like Policybazaar - here are 7 Things You Must Watch Out For - so you don’t have regrets later on. 

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Once you enter your initial profile details on the Policybazaar platform, the website will display a list of products that you can choose from. You can compare, shortlist and review the basic details of these products on this display screen. However, the products aren’t ranked based on any specific criteria. 

You’ll notice that there will be products of a lower cost that are ranked higher, and even products with a higher Claim Settlement Ratio, that might be rated lower. (more about the Claim Settlement Ratio itself later…). Here’s a screenshot for instance. 
 

You’ll note above that if you see the prices - the product by MaxLife is actually cheaper (for the same 1 Crore cover) than the ICICI Prudential or HDFC Life plans that are listed above. 

Further, if you check the Claim Settlement Ratio (which they suggest as the right metric to compare the best term insurance plans), you’ll see that the MaxLife product still actually has better metrics than the others - but is listed below. 

If you’ve used any online comparison platforms for shopping, travel, etc. - you might assume that the products displayed on the top are the best ones. Further, if there’s a sponsored listing that’s displayed ahead of the regular ones, it is clearly mentioned - so, you consider that information before jumping to conclusions. 

In the case of insurance products listed on Policybazaar.com, however, this isn’t the case. 

What can you do? 

Ensure that you manually sort the listing to your preference before making a decision. You can use the sorting option as well as filters to find the best options based on your priorities. 

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As said above, most insurance aggregator platforms still use the Claim Settlement Ratio as the perfect metric to decide whether a company is a good one or not. And if you’ve been a regular on Beshak - you’ll know how much we love debunking this Ratio. 

Basically, the Claim Settlement Ratio gives the ratio of the Total No. of Claims Settled by an insurer in a year, to the Total No. of Claims they Received. While this is the most popular metric showcased by everyone from insurance companies to aggregators - there are three major issues with it. 
 

1. It does not tell anything about the valid claims received by the insurer, and the valid claims settled. So, for instance, an insurer receives a much higher number of fraud claims in a given year - identifies and rejects them - it will impact their Claim Settlement Ratio, unfairly. 
2. It doesn’t say anything about the amounts settled by the insurer. It is possible that an insurer approves all smaller claims quickly, and rejects higher amounts (like your term insurance claim would be) - and the Claim Settlement Ratio will not account for this disparity. 
3. It doesn’t give any insight into the Claims experience the insurer offers. Will your family get the claim amount smoothly, will they have to visit the branch office several times, will they get the support they need? You’ll not get to know from this metric. 

In fact, the problem with the Claim Settlement Ratio is something that extends to insurer websites as well - where they proudly display a high ratio - even while in reality the quality of their claims experience itself could be quite poor. 

What should you do?

So, if the Claim Settlement Ratio is not good enough - then, what is? 

We recommend, you check out Beshak ⭐ Ratings - a data-backed comparison platform that goes way beyond this flawed Claim Settlement Ratio, and gives a wholesome picture of how good the product is, how the insurer’s customer service is, and how smooth the claim settlement experience for your family will be. 

Moving on. 

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You should be aware that not all available insurance products are available for comparison or purchase through Policybazaar. In fact, some important and extremely popular insurance brands are left out of the comparison. 

For example, in term insurance, you will not find LIC listed at all. This can be surprising as LIC still remains the best-known and largest life insurance company in the country. 

Similarly, in health insurance plans, you will not find HDFC Ergo or ICICI Lombard’s plans listed or compared. 

While there might be many reasons why these brands are left out - it is best to be aware of what you are missing with the missing brands and their plans. 

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One of the main problems with buying insurance online is that it isn’t always a completely online experience. First, you’re required to enter your personal details on the Policybazaar website and then, the journey takes you to make the payment. This payment is the means by which the aggregator platform guarantees your business to the insurer. 

Once this is done, your case is moved to another team within Policybazaar who will take care of the policy issuance and post-sales service - different teams, different representatives.  This team takes care of the issuance part of the business, coordinating with the insurance company, etc. 

1. In some cases, the insurer will need you to fill another part of the proposal form along with any medical declarations that help them decide whether they can afford to cover the risk. 
2. Based on these medical declarations, the insurer might also ask you to undergo some medical tests and submit the results to them. 
3. It is also at this step that the insurer will request documentation - address proofs, identity documents, income proofs, etc. which they will evaluate in detail before issuing your policy. 

This is the part of the journey that is often invisible when you’re exploring insurance online. Many customers are even taken by surprise when detailed information isn’t requested before the payment. We have actually had questions on the Beshak Insurance Forum, where individuals asked if they would get the policy without having to give any declarations or documents at all. 

Clearly, it is not so!

What should you do?

Be aware that a part of the transaction (especially post payment) will remain offline in every case, and that throughout the journey you will need to interact with multiple people on toll-free numbers to get the policy approved. If something goes wrong, it has a domino effect. You will need to be patient and follow through with every milestone in the policy to ensure your policy is issued - and issued correctly. 

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While most online aggregators for insurance - including Policybazaar - offer 24-hour call centers and support systems with the intention of helping customers with their claims - it isn’t a very effective system yet. . This is owing to the fact that with most insurance companies, the claims process still remains offline.

On any other e-commerce platform - say Amazon, Booking.com, Swiggy - If you’ve made a purchase through the platform, the platform takes complete responsibility for the delivery of the services. If you’re not happy - they return the money or offer a replacement. 

But, when it comes to insurance, the story isn’t exactly the same. You might purchase the plan from a Policybazaar or Coverfox - but the claims are settled by the insurer directly.  (And in most cases, remains completely offline - needing you to visit the branch office). 

While the platforms do offer a claims-assistance feature, it usually is limited to help with the initial documentation process that remains offline. But, post that your family will still need to visit the branch office, follow up over the phone with the insurer if their claim is stuck. Your family must be very lucky to get a decent experience through an aggregator like Policybazaar, during claims. 

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An insurance portal insider told us about the system customer-care centers follow to ensure all sales calls remain productive. According to this -

• If a customer doesn’t pick a call, and it continues to ring - they call back after 5 minutes
• If the phone is switched off, they’ll call again in an hour
• As long as someone’s phone is ringing, they’ll call at least 5-6 times within the first hour, and even 8-10 times within a day!

The only measurement of that executive’s success is how many sales they make, and how much volume of sales they make. They are incentivized for meeting daily, weekly and monthly sales targets - with zero emphasis on the quality of service or problem resolution they offer. 

And to achieve these, they are compelled to take varied means- from harmless cold-calling to spamming you from different phone numbers, pushing products with high commissions (regardless of their suitability), and outright mis-selling.

Before you decide to explore the online aggregator to buy your policy from - you must accept that you will have to be patient with the several calls you’ll get - in the next few days during work, during personal time - incessantly. Only if you’re truly okay with that, should you even enter your phone number on the platform. 

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Any insurance business runs on commissions. Whether you decide to buy from an online aggregator or through a financial advisor you know personally - there’s a cut, a hefty commission that goes to them that makes the sale. However, when it comes to online platforms, the problem will be that you’re constantly interacting with a system-assigned executive who has zero incentive to make a decision that’s purely right for you. 

In fact, you might not even speak to the same salesperson again, throughout your journey. Every time to call, you’ll be connected to a system-assigned executive, with no personal commitment to giving you the right advice. 

In contrast, you’ll see that a good financial advisor that you pick to work with, will be on your side - as they’re worried about a reputation to keep up. For an advisor, a good reputation means a long-term customer relationship, and several references - meaning better business. Also, you will help a well-meaning individual make a legit earning instead of an enterprise. 

In fact, we’ve written a dedicated article to help you understand all the differences between buying from an aggregator platform and a financial advisor - both sides of the story, pros & cons - and we strongly recommend that you check it out. 

So, this is our list of 7 Things You Must Keep In Mind while buying your insurance from an insurance aggregator platform. With these insights, you’ll be better prepared for the challenges you might face, as you choose the convenience of buying your term insurance plan online. 

If you have any further questions about finding the best term insurance plan that fits your family’s requirements, you can post them on the Beshak Insurance Forum - where you can get insights and guidance from experienced financial advisors and curated experts for free.