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IMDR’s Journal of Management Development and Research 2022-23

Online selling of Insurance

Asmita Mehendale and Kaushambi Dayal

PGDM II, DES’s Institute of Management Development and Research, Pune

Abstract
The Indian life insurance industry has a bright future. This industry has a very healthy 2014 revenue of
US$ 72 billion and reached US$ 280 billion in 2020. The favourable regulatory environment in India is
the main driver of this expansion. In this industry, IRDA has always ensured stability and fair play.
Innovative product lines, vibrant distribution systems, and vivacious PR and promotion activities
carried out by insurance companies are other factors that have contributed to the growth of this
industry. The introduction of Internet insurance in recent years, namely since 2005, has considerably
aided in the expansion of the insurance industry. In addition to attempting to identify the difficulties,
this research attempts to examine the birth and development of online life insurance in India.

Keywords: Insurance Industry, Internet Insurance, Regulation, Life Insurance

Introduction:
During the past few years, online has become a buzzword in India, especially in sectors like travel,
retail, banking, and education. The majority of Indians already use online banking. When it comes to
internet purchases, fixed deposits and mutual fund investments are the most popular investments.
Today, paying bills and transferring money through net banking are commonplace. Insurance follows
closely behind. Customers are responding well to life insurance as internet insurance policy purchases
gain popularity. Prior to now, consumers used the internet primarily to search for products, renew
policies, and pay premiums. However, with increased transparency, ease of use, and cost savings,
consumers are now buying a variety of policies online.

India’s Introduction of online life insurance
More than 165 million Indians have access to the internet now. Indians are currently the third largest
users of social networking sites like Facebook and spend more time online than watching television.
The majority of Indians also use net banking. Insurance businesses have quickly shifted from a modest
beginning, similar to the banking industry, with online transaction services for current customers, to
selling products online. Around 45% of internet users have been observed to look for financial services
and insurance as a category. The online adventure of insurance began with the emergence of
comparison and research platforms, much like the online travel and retail industries. In parallel, the
idea of insurance aggregation gained traction in 2005 with the entry of companies like Apna insurance
and Bimadeal.

Twenty additional players, including Policybazaar, Zibika, Fintact, Myinsuranceclub, and Insuring
India, among others, also built their own aggregation websites. Startups forayed into selling leads to
insurance firms after testing the aggregation strategy and received a commission on each lead
conversion. With the necessary approvals in place, Policybazaar and Myinsurance club have started
selling policies online in India, moving beyond the aggregation approach. For both businesses,
receiving permission from the Insurance Regulatory and Development Authority (IRDA) was a key

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