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Online insurance platform ‘Toffee’ to roll out products for millennials

Jan 22, 2018

The digital-only insurance platform ‘Toffee’ is looking to distribute specially-designed products to cover lifestyle risk of millennials.

People in the age bracket 25-35 years are usually referred as the millennials.

According to Rohan Kumar, co-founder and CEO of Toffee, these will be simplified offerings, customised to cover specific risks at an attractive price point.

Toffee, which is a corporate agent, currently curates products from general and health insurance companies, including Apollo Munich, HDFC Ergo and Future Generali. The company has already rolled out various offerings, priced between ₹600 and ₹1,500. These include Anti-Dengue Toffee (for treatment for dengue), Commuters Toffee (for daily commuters exposed to accidents), and Globetrotter Toffee (policy for international travel without market/regional exclusions).

“We plan to roll out seven more products, including Renters Toffee (covering theft and repair of goods), Stay Fit Toffee (to cover injuries while working out) and Backpacker Toffee (for domestic travel) in the next one month,” Kumar told BusinessLine. Designed in a fluid web app flow, Toffee claims to reduce purchase time to 90 seconds on average, along with simple claim processing in under two hours.

The start-up, which was launched about five weeks back, is looking to tap 50 million digitally active users on social media platforms in Tier-I and -II cities and sell close to one lakh policies in the next one year.

According to Kumar, there has not been much ‘product innovation’ across the insurance industry in the recent past. A majority of the offerings are ‘blanket products’ which have same structure and contours for people of all groups. There is hardly any scheme which has been designed with the young audience in mind.

“A majority of these products, that were designed for the offline channels, are now being pushed online. But millennials do not understand such complex schemes. They are looking for simpler and more niche offerings,” he said. This is where Toffee comes in.

Using behavioural and real-time data, it identifies specific needs of the target customer and suggests it to insurance companies it has partnered with. The insurer then comes up with products at a particular price point, which is typically lower than an umbrella or all-encompassing product.

“Most insurance companies usually take a fairly exhaustive cover which is all-encompassing; we try to de-bundle those products (based on customer requirement). The insurers’ actuarial team then comes up with niche offerings at an attractive price point,” he pointed out.

Source: The Hindu Business Line

Plea against insurance company dismissed

Jan 19, 2018

Due to lack of evidence to prove it was a case of burglary

The National Consumer Disputes Redressal Commission (NCDRC) on Tuesday dismissed a revision petition filed by a complainant against National Insurance Company alleging that the company had wrongfully repudiated a claim.

Narender Kumar had alleged that medicines worth over ₹82,000 were stolen from his medicine shop in 2003. Further, he had alleged that the area watchman was found dead in the vicinity.

Claiming loss due to burglary, Mr. Kumar had approached the company for suitable compensation.

However, the insurance company repudiated the claim stating there was no evidence of forceful entry resulting in burglary.

“The claim was repudiated stating that “no signs of forcible entry have been persisted at the gate of the shutter, whereas the policy coverage risk of burglary and house breaking policy,” read the order.

‘No deficiency in service’

Stating that there had been no deficiency in service, the insurance company contended that the complaint should not be entertained.

The Haryana State Consumer Disputes Redressal Commission in Panchkula had earlier set aside the district forum order which had asked the insurance company to compensate the complainant.

Upholding the State commission order, the NCDRC observed that there was a lack of evidence to prove that it was indeed a case of burglary.

“As per the FIR, the complainant opened the lock at the shop. It was found intact. As stated by the complainant, the upper portion of the shop, which was shattered, was found open but there was no connection between the first and ground floors. Admittedly, the theft took place on the ground floor and medicine displayed in the showcase were stolen,” the NCDRC observed in its order.

Further, the national forum held that the death of the watchman cannot be linked to the theft as he was not incharge of this particular shop.

“He was not the chowkidar of the complainant’s shop. Therefore, it is not correct to draw the inference that he was murdered while resisting the burglary attempt in the shop of the complainant,” the court said.


Lower own-damage car insurance premiums

Jan 16, 2018

You can expect your motor insurance premium to go down in 2018. Some general insurance companies have announced a reduction of 5% to 20% in the own damage (OD) part of motor insurance premiums from 1 January 2018. While companies like Bajaj Allianz General Insurance Co. Ltd, ICICI Lombard General Insurance Ltd and Universal Sompo General Insurance Co. Ltd have already cut the OD premiums, others like HDFC Ergo General Insurance Co. Ltd and Future Generali India Insurance Co. Ltd are also expected to implement the reduction, though they have not finalised its quantum yet.

Why the reduction

Rajiv Kumar, managing director and chief executive officer, Universal Sompo General Insurance said that the implementation of Motor Insurance Service Providers (MISP) guidelines from 1 November 2017 is the reason for cutting OD premiums by 15-20%. The Insurance Regulatory and Development Authority of India had released the MISP guidelines in August 2017. The guidelines specify that for selling company’s insurance policies, an MISP can be offered incentives by the insurer or the intermediary it has tied-up with. But the maximum amount allowed is 19.5% of the OD premium. The guidelines specifies that MISPs will not be allowed anything over the incentives, whether it comes in the form of fees, charges, infrastructure expenses, advertising expenses, documentation charges, legal fees, advisory fees, or any other payment.

There have been other cost savings too. ICICI Lombard, for instance, now generates 87.5% of all its policies digitally and over 90% of its OD motor surveys are also done through video streaming, said Sanjeev Mantri, executive director, ICICI Lombard. “This also saves a big cost for us,” he said.

The introduction of Goods and Services Tax has also benefited. “Previously, we would end up paying VAT (Value-added Tax) on the spare parts (for vehicles), which was booked as an expense. With GST, we get input credit for what we spend on spare parts. That has come as a significant saving as we were paying around 12% VAT,” Mantri said.

Who benefits

Motor insurance, including personal and commercial vehicles, is the largest part of general insurance in India. The reductions in premiums are being offered mainly for personal vehicles. Some insurers are currently limiting it to private cars while some are extending it to two-wheelers too. The reduced premium is being offered on new policies and renewals.

The reduction is only on the OD part of the car insurance premium. A motor insurance policy has two main components—third-party liability and OD. In India, it is mandatory for all registered motor vehicles to have insurance for third-party liability. The premium for this is fixed by Irdai and is announced every year. Premium paid towards this do not cover damage to the vehicle or its owner. It only covers liabilities arising from damage caused to a third party. The damage could be due to an accident resulting in injury, death, or damage to property.

The OD part of motor insurance is optional and it covers damage to the insured vehicle in case of an accident. This part of insurance also covers thefts.

Premiums for this part of a motor insurance policy are not fixed by the regulator and insurers can price it as they see fit; hence the ongoing offer of lower premiums.

This distinction may not be clear to some people because when they buy a motor insurance policy, the third party and OD covers come bundled in it. Without knowing it, they actually pay premiums for both covers. While buying a motor insurance, you should compare the pricing being offered by different insurers and then decide.


Vehicle insurance firm fined for repudiating claim

Jan 08, 2018

The district consumer disputes redressal forum has directed an insurance company to pay Rs 3.50 lakh to a local resident who had purchased insurance for his vehicle that later met with an accident. The forum has also asked the firm to pay Rs 2,000 as litigation expenses.

Kashmir Singh, a resident of Ghaluwal village, had filed a complaint against Reliance General Insurance from which he had purchased insurance for his car. Later, his vehicle met with an accident. He said that vehicle was taken to a service centre and the opposite party was intimated about it.

The complainant stated that the insurer and the service station, as per preliminary estimate, assessed the damage to the amount of Rs 4,38,322.64, terming the vehicle as a total loss.

The Insured Declared Value of the vehicle was Rs 3,50,000, but the claim was repudiated on frivolous grounds that there was a delay in providing information.

The opposite party, in its reply, stated that accident had occurred on November 20, 2016 whereas the first intimation was given on December 29, 2016 after a gap of 40 days. The reply stated that as per basic condition of the motor policy, immediate intimation is to be lodged with the insurance company in case of any loss or damage and thereafter requisite documents are to be submitted within stipulated period.

According to the insurance firm, its surveyor assessed the loss to the tune of Rs 1,98,233. “The vehicle was repairable but the said amount was not payable on account of violation of the condition i.e. delayed intimation,” it mentioned.

The forum observed that the opposite party couldn’t reject the claim only on the ground of delayed intimation as the rejection should be based on valid grounds. The forum further stated that as the copy of terms and condition was not supplied to the policy holder nor ever disclosed by the opposite party, hence the impugned clause of the insurance cover was not applicable in this case.

The forum also stated that the complainant was entitled to get Rs 3,50,000, not Rs 1,98,233 as assessed by the surveyor.


‘Linking insurance policies with Aadhaar, a mammoth task’

Jan 05, 2018

General insurance companies are understood to have sought an extension of the March 31 deadline for seeding the policyholders’ accounts with Aadhaar.

G Srinivasan, Chairman and Managing Director of New India Assurance Company, said, “It will be a mammoth task considering that we do not have the technology in place for seeding of accounts with Aadhaar and in many cases, we do not have the contact number of the policyholder to get on to the job on a war footing.

“We have, over the last couple of weeks, started collecting details from customers who have either sought to renew their existing policy or bought a new policy. Only when the technology is in place, will we be able to link the customer’s account with the Aadhaar number.”

While the company is in the process of putting in place a technology solution to address this issue, Srinivasan said, “When a policy is bought online or when an individual takes delivery of a vehicle, the dealer helps the buyer with the insurance cover. In such instances, we hardly get to see the customer. The seeding of the policy with Aadhaar is therefore, going to be an uphill task for insurance companies.”

The company services 2.7 crore policies, and all these will have to be linked with Aadhaar within the next 11 weeks.

Source: The Hindu Business Line

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