Page 30 - Insurance Times January 2024

Outlook on the

insurance

industry and

way forward Rrajesh Sharrma

CEO & Principal Officer
Anand Rathi Insurance Brokers Ltd.

Insurance companies are moving beyond generic policies towards hyper-personalization. Through
data-driven insights, they can offer policies that cater specifically to the unique circumstances of
each policyholder. For example, usage-based auto insurance adjusts premiums based on driving
behavior, fostering a sense of fairness and affordability.

T he outlook of the insurance industry is undeniably usage-based auto insurance adjusts premiums based on

intertwined with product innovation,
driving behavior, fostering a sense of fairness and
customization, and streamlined claim settlement
affordability.
processes, all supported by digital advancements.
This evolution is not merely a response to market trends but This has led the Insurance Companies to adopt a more
a proactive approach to meet the evolving needs and Modular approach. Insurers are breaking down coverage into
expectations of customers in an increasingly digital and modular components, allowing policyholders to choose and
dynamic landscape. pay for only the coverage they need. This modular approach
provides a cost-effective solution, eliminating the burden of
Reimagining Product Innovation: In the quest for sustainable unnecessary coverage. Understanding that lifestyles vary
growth, insurance companies are redefining their product widely, insurers are developing products tailored to specific
offerings. Traditional policies are giving way to more demographics or activities. Whether it's insurance for
dynamic, personalized solutions. Insurers are leveraging frequent travelers, fitness enthusiasts, or pet owners,
data analytics, artificial intelligence (AI), and machine customization is becoming a defining feature of modern
learning to gain insights into customer behavior, insurance.
preferences, and risk profiles. This wealth of information
enables the creation of tailor-made insurance products that Parametric insurance is also gaining traction, especially in
align with individual needs and lifestyles. areas prone to specific risks like natural disasters. This
innovative approach defines payouts based on predefined
Hence, Insurance companies are moving beyond generic parameters such as seismic activity or weather conditions,
policies towards hyper-personalization. Through data-driven providing faster and more transparent claim settlements.
insights, they can offer policies that cater specifically to the With the increasing frequency and sophistication of cyber
unique circumstances of each policyholder. For example, threats, insurers are introducing specialized cyber insurance

The Insurance Times January 2024 27