Payments service provider MobiKwik is looking for start a “shampoo-sachet” concept to the insurance sector. The company has partnered standalone health insurer Max Bupa to offer a string of bite-size insurance products in the medical insurance segment.
Upasana Taku, co-founder – MobiKwik, has told Moneycontrol that, while there are multiple insurance products in the country to choose from, but a majority of Indians cannot afford to buy them.
Insurers have products for individuals who have monthly income of Rs 40,000 and above. They are looking to offer products with premiums as low as Rs 20 so that the masses can buy it instantly.
Taku said that they entered the insurance segment six months ago and have been selling 90,000-100,000 policies a month.
Currently, they are selling products under the group platform. They will soon apply for a corporate agency licence with the insurance regulator. This will help us distribute insurance products with the right partners, she added.
Corporate agents are allowed to sell products of three life, three non-life and three standalone health insurers each.
Ashish Mehrotra, MD & CEO – Max Bupa Health Insurance, has said that they foresee bite sized insurance products stirring the insurance sector in the near future, eventually bringing more and more new customers into the ambit of health insurance.
Mehrotra said that they were enabling financial inclusion by making pocket size health insurance solutions available through the Mobikwik platform and plans to acquire one million (Mobikwik) customers over the next three-four years.
More than two decades ago, FMCG firm P&G introduced the concept of shampoo sachets in India. This was to enable price-sensitive customers to experience their products at a cost of Rs 1 and Rs 2 per sachet. This is exactly the idea that Taku aims to emulate in the insurance sector.
Whenever a customer comes to the MobiKwik platform to make payments, Taku said that they target them during that period. For instance, the platform has a product that offers content cover against fire from gas leakage. The premium is Rs 25 per month for an insurance cover of Rs 2 lakh.
In the same way, there is a personal accident cover for Rs 20, Rs 60 and Rs 100 annual premium for sum-assured of Rs 1 lakh, Rs 3 lakh and Rs 5 lakh respectively. Life insurance covers are available for Rs 148 annual premium for sum assured of Rs 1 lakh. Taku said that they would offer quarterly, as well as bi-yearly, premium options in the near future.
Taku also added that if customers started buying/renewing insurance on a regular basis, not only would their credit history improve but they would also be able to avail newer policies at cheaper premium rates.
The share of insurance premiums in India’s gross domestic product (called insurance penetration) saw a marginal increase to 3.69 percent in FY18 from 3.49 percent a year ago. As per the Swiss Re sigma report, insurance density or premium per person stood at $73 for FY18 versus $59.7 in the previous year.
