Page 39 - Insurance Times May 2023

sales crossing 10 lakh units in FY23. Two-wheelers made up designed to redistribute funds to users and support social
for the bulk of EV sales in FY23. good in their communities.
However, delays in subsidy disbursements, under FAME-II, Policyholders contribute to a common fund to cover each
have slowed manufacturing, according to the Society of other against damage and loss. Once a year, ETAP will collate
Manufacturers of Electric Vehicles (SMEV). all the remaining funds after claims and associated costs
have been deducted and redistribute to policyholders, or to
IRDAI introduces direct plans in their chosen non-profit cause.
insurance This may include non-profit organisations working towards
ending homelessness, educational programmes, healthcare
IRDAI has introduced direct plans in insurance from April 1,
initiatives for the bottom of the pyramid, human rights
2023.
advocacy, and orphanages. Policyholders can also receive
The insurance regulator has asked insurance companies -
their surplus via cashback or a discount on renewals.
life, non-life and standalone health insurers to devise a board
According to IbraheemBabalola, CEO and founder of ETAP,
approved policy for directly sourced policies. Insurers will
"To drive insurance penetration in Africa, where less than 3
have to define a manner in which they will reduce premium
per cent of the population own any kind of insurance, we
if a policy is sourced directly to a policyholder.
need to design new products that meet the diverse needs
In a gazette notification, IRDAI said, "Every insurer shall
of people across the continent.
have a well-documented policy approved by its board on
annual basis, which shall, specify manner of transfer of "In a country like Nigeria where Muslims make up almost
benefits, arising from reduction of expenses and/or from half of the 220 million population, the vast majority of
directly sourced business to the policyholder by the way of insurance products on the market are not an option to most
reduction in premium." Muslims because the way the policies are structured goes
against their religious belief."
With this, insurance companies will have to reduce the
premium if policyholder buys an insurance policy directly ETAP is the first African insurtech to enable the option of
from an insurer. Such a reduction will happen from expenses Takaful insurance on the continent. Starting in Nigeria, users
of management which includes agents commission. can now access the option on the ETAP app alongside other
insurance options and immediately begin to give back to
So far, while insurers are allowed to sell insurance policies
their communities while having the peace of mind that
directly to the policyholders, there is no reduction in
comes with having their cars insured.
premium. However, IRDAI has now clarified that insurers
will have to pass on this benefit to the policyholders. They simply need to download the app, provide basic
information about their car and driving history, and choose
Among other key instructions to the board of insurance
the level of coverage they require (daily, weekly, monthly,
companies are:
quarterly or annual) and they can start enjoying the benefits
Make well defined policy on structure of commission of
of an ethical car insurance product.
agents/brokers
Leveraging ETAP's technology that allows drivers to buy
Implement measures to reduce cost and expenses of
insurance in 90 seconds, complete claims in 3 minutes or
management on annual basis
less and get rewarded for good driving and avoiding
Implement manner of computation of additional accidents, users can now enjoy an added layer of ethical
allowance insurance on top of what is already the fastest claims
Ensure compliance with the IRDAI norms process on the market.
Further, IRDAI has asked insurers to devise business plan ETAP's business model is based on the concept of Shared
keeping in mind their capital requirements, projection of Value Insurance, which focuses on incentivising people with
solvency margin and protection of expense of management. rewards to reduce their insurance risk by adopting good
behaviour.
ETAP launches 'ethical car insurance' With ETAP, drivers are able to earn Safe Driving Points that
ETAP, an African insurtech company, has launched ETAP can be exchanged for shopping vouchers for the most in-
Takaful, a new ethical car insurance product based on Islamic demand retail outlets, fuel, cinema and concert tickets, and
principles. Unlike conventional insurance, ETAP Takaful is other exciting experiences.

The Insurance Times May 2023 35