People, especially in emerging markets where insurance penetration rates are still low, often view insurance with confusion and even distrust, due to lack of clarity.
This was one of the reasons why Kamesh Goyal (pictured), an insurance veteran with over 30 years’ experience, founded Digit Insurance, a technology-focused insurance provider in India backed by the Fairfax Group. The firm’s stated goal is to “make insurance simple.”
Goyal began his insurance career at The New India Assurance Company, the largest public sector general insurer in the country. In 1999, he joined Allianz, where he rose through the ranks to hold various national, regional, and global positions.
“For a lot of people in India, this sounded like an oxymoron – ‘Simple and insurance? Nah!’ they would say,” Goyal told Insurance Business. “That’s exactly what we took as a challenge as that’s where the opportunity was. We felt that if there is one thing that would truly make a difference to people in the insurance context, it is busting complexity and bringing in a simpler insurance.”
According to Goyal, the main goal was to simplify the insurance customer’s journey and provide them with a seamless experience, from products to processes and documents.
“We are glad, with this mission, we have crossed a base of three million customers with premiums of over INR12 billion (US$174.9 million) and more than 35,000 claims,” he said. “We started operations in December 2017, and have received investments of US$94 million so far, over two rounds of funding.”
Goyal considers Digit Insurance’s achievement of a 72% net promoter score (NPS) a huge milestone for the company.
“Insurance as a concept was started on the idea of empathy and trust, to help someone in a distressful time,” he said. “This concept has, over years, been abused with the addition of complicated terms & conditions and tedious processes. And the result is dissatisfied consumers, making the NPS low for the insurance companies.”
To change this, the company had to make significant changes. It had to look beyond good customer service and redefine products, processes, and documents throughout the insurance cycle.
“We believe that with full understanding of the terms and conditions, people are more in control of their claims,” Goyal said. “With being more in control, especially during claims, people’s expectations are correctly managed. With smooth and paperless processes, people’s overall experience becomes better. Therefore, with the entire machinery being redefined, our NPS scores look the way they do, reflecting people’s satisfaction with Digit.”
Internally, all levels of Digit Insurance, including top management, listen to customer feedback and take corrective actions when necessary, Goyal said.
Another milestone that Goyal is proud of is Digit achieving a 2% market share in motor insurance. This is significant for a new firm such as Digit, as India’s motor insurance sector is dominated by public sector players such as New India Assurance.
“For a newcomer in the insurance industry, it is challenging to gain the trust of customers, especially when it comes to traditional products like motor insurance,” Goyal said. “To get a share of the pie in this category required us to identify the gaps in the industry and fill them. One such gap, which we feel really helps us gain our customers’ trust, was the time taken for a claim to be processed.
Traditionally, it took around seven days for a car inspection to happen. But with our smartphone-enabled self-inspection tool, we brought this time down to seven minutes.”
According to Goyal, despite Digit being considered an insurtech company, it continued to grow its intermediary base, which includes agents, brokers and dealers.
“We felt that the majority of Indian population still has huge trust in insurance agents – they have years of rapport of with them,” he said. “Instead of colliding with that, we thought of joining hands there. Therefore, with an innovative approach towards processes and balanced approach towards distribution, we feel we could achieve the 2% market share milestone among the giant players as well.”
Following Digit’s launch in India, the Canada-based Fairfax Group and its Indo-Canadian founder and chairman Prem Watsa have indicated plans to take the insurer’s model overseas.
“We are glad that Mr Watsa is happy and impressed with our tech platform,” Goyal said, adding that Watsa, in his recent visit, mentioned that Digit’s platform will be useful to other Fairfax companies globally, and specifically mentioned Brazil and the US.