The payments platform is also looking to apply for a corporate agent licence with the insurance regulator
Payments service provider MobiKwik wants to bring a “shampoo-sachet” concept to the insurance sector. The company has partnered standalone health insurer Max Bupa to offer a slew 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, a majority of Indians cannot afford to buy them.
“Insurers have products for individuals who have monthly income of Rs 40,000 and above. We want to offer products with premiums as low as Rs 20 so that the masses can buy it instantly,” she added.
With respect to the partnership with Max Bupa, the company has launched a HospiCash plan that has an annual premium of Rs 135, which provides a daily cash allowance of Rs 500, for up to 30 days, during a hospital stay. There is an inbuilt accident insurance cover of Rs 1 lakh. The higher variants of Rs 225 annual premium and Rs 400 annual premium provide Rs 1,000 and Rs 2,000 per day respectively.
Taku said that they entered the insurance segment six months ago and have been selling 90,000-100,000 policies a month.
“Currently, we are selling products under the group platform. We will 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 driving 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 plan 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.
Recalling an experience that occurred four years ago, Taku said, when she had delivered a child, another woman had to admit her new-born child to the hospital for several weeks in the same hospital.
“The new parents had not at all planned for this emergency hospitalisation. It was then that I realised that the need of the market is more small-ticket and easy to purchase products,” she added.
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.
Similarly, 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 once 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 a cheaper premium.
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. According to the Swiss Re sigma report, insurance density or premium per person stood at $73 for FY18 versus $59.7 in the previous year.Subscribe to Moneycontrol Pro and gain access to curated markets data, exclusive trading recommendations, independent equity analysis, actionable investment ideas, nuanced takes on macro, corporate and policy actions, practical insights from market gurus and much more.
