If you have a Gmail account, there is a high probability of your inbox receiving frequent offers on insurance policy offers. So much is the online clamour to sell insurance that a life insurer has claimed to have gone almost agent-less with only the online route to buying their policies. Predominantly, an online life insurance sale happens in the term policy category, because it has managed to become a commoditised product in which price comparison is what that matters as the policy benefit is straightforward—on death of the policyholder the insurer pays the sum insured and if the policyholder survives, he gets back no money.
Going by recently released data by IRDAI, the 2015-16 data reveals that online sales channel accounted for a measly 0.22 per cent of new business premium. The total number of policies sold was 5,34,760. Of this, a miniscule number were sold online. Yes, there is convenience in paying insurance premiums through the digital and online mode, but beyond that purchasing policy online is not fully practical. There are limitations on how much life cover one can buy online without getting into under writing issues. So, all the fancy talk over online insurance selling is not as easy and streamlined as it is made to seem, at least, that is what data in the annual report indicates.
