India is the largest SME (Small and Medium Enterprise) market in the world contributing to employment generation and overall growth. According to IBEF, the Udyam Registration portal registered 446,980 small and 40,400 mid-sized enterprises as of February 2023. The pandemic turned out to be a major reason behind this immense growth in the SME number as many people who lost jobs during this tough time were forced to start their own businesses in order to survive.
However, insurance penetration in this category has been quite low. Majority of the SMEs are either underinsured or have no insurance at all. When it comes to insurance, navigating the insurance marketplace could be a cumbersome task for SMEs. Nonetheless, insurance is a necessity for businesses, regardless of their size, to protect themselves against unexpected risks. This blog explores the transformative power of digitization in revolutionizing the insurance experience for SMEs in India, bringing efficiency, convenience, and better coverage options.
Here are some common CX challenges they face in this process:
- Complex Policy Documentation: Insurance policies typically involve lengthy and complex documentation with technical terms and legal jargon. SMEs may find it challenging to comprehend the policy details, coverage exclusions, and limitations. This complexity can lead to confusion and difficulty in selecting the right coverage and understanding the extent of protection provided.
- Limited Coverage Options: Insurance providers may offer limited coverage options tailored specifically for SMEs, especially in niche industries. SMEs may need help finding policies that adequately address their unique risks and requirements.
- Lack of Risk Assessment: SMEs may need more expertise or resources to conduct thorough risk assessments and implement effective risk management strategies.
- Inefficient Claims Handling: SMEs may face challenges in navigating the claims process efficiently. Delays, complex procedures, and limited communication during the claims settlement phase can negatively impact their operations and cash flow.
- Limited Flexibility and Customization: SMEs often require flexible insurance solutions that can adapt to their evolving needs as they grow and change. Insurers that offer rigid policies with limited customization options may not fully address the unique requirements of SMEs, leading to gaps in coverage or unnecessary expenses.
Decoding the Insurance Needs for SMEs:
- An exclusive platform for all insurance needs.
In the last few years, many insurance companies in India realized the pain points of SME owners, especially post-Covid -19, and have started focusing more on SME customers.
Mantra Labs worked with APACs leading life insurance firm to develop an exclusive digital insurance platform and transform the experience of SME owners.
- Customized Products: Tailored Coverage Options
Digital platforms have enabled insurance providers to offer specialized coverage options specifically designed for the unique needs of SMEs. Whether it’s comprehensive business insurance, professional indemnity, or cyber risk protection, SMEs can now access policies that cater to their industry-specific requirements. This customization ensures that SMEs receive the necessary coverage while optimizing their insurance investments.
- Faster claims management:
Leveraging technology, SMEs can now submit claims online, track their progress, and receive quicker settlements. Automation and integration with relevant data sources enable insurers to expedite claims processing, enhancing the overall experience for SMEs.
Empowering Small Businesses
Technology can help in choosing the right personalized insurance for SMEs.
Data Analytics for Risk Management:
Digitization unlocks the potential for robust data analytics, enabling SMEs to gain valuable insights into their risk profile. Insurance providers can leverage data collected from SMEs’ digital interactions to offer personalized risk management solutions. By analyzing historical data and identifying patterns, insurers can proactively help SMEs mitigate risks and prevent losses, ultimately contributing to their long-term success.
Recently, ICICI Lombard partnered with actyv.ai- a Singapore-based SaaS platform to co-create innovative insurance solutions specifically designed for SMEs and their supply chain partners.
Conclusion
Digitizing insurance experience for SMEs is a vital step that insurance companies must take to gain a competitive edge in the market. SMEs are the backbone of any economy and must be adequately protected against unforeseen events that may affect their businesses. As customer experience becomes more critical in the insurance industry, digitizing the customer experience has become a necessity if insurance companies want to attract and retain SME customers.
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