WATCH: This insurtech startup aims to go the extra mile to find you the best policy
In this video interview, Bengaluru-based InsureMile Co-founder Mallesh Reddy explains how his startup is helping people buy insurance according to their specific needs, rather than buying it because they were sold to them.
After working in insurance analytics and customer experience in the US and Southeast Asia for over two decades, Mallesh Reddy returned to India and started up with InsureMile in early 2017. He decided to do so when he realised that the insurance industry in the country was all about sales rather than figuring out what the customer actually needs.
So, after heading companies like iTrans Technologies, a motor insurance analytics company, and working in management in Sony, Singapore, 46-year-old Mallesh decided to set up InsureMile to use tech to understand what a customer needs:
“I have understood that algorithms can match the expectations of customers and understand their need. A lot of people don’t even know what is beneficial for them, but tech can figure it out.”
Watch his interview with YourStory here:
Lack of knowledge
India has the lowest health insurance penetration. In fact, only 3.2 percent of the population has insurance. There are 80 million motor insurance products sold, 22 million health insurance policies sold and 38 million life policies sold each year according to the Insurance Regulation and Development Authority of India (IRDAI).
A lack of knowledge about insurance products often leaves the customer short-changed. For instance, third-party motor insurance, which is cheaper and covers most of the damages incurred, is not that well-known. “Unfortunately, people are not aware of it because there is so much fine print,” Mallesh adds. Bengaluru-based InsureMile aims to change this status quo.
“People sometimes don’t even know why they buy insurance. They buy it because of tax reasons and they don’t have goals. The goals could be retirement, health, or travel. My plans are to go after the millions who are under-insured,” says Mallesh.
From January 2017 to August 2018, Mallesh’s small team of six built the entire backend, procured the web aggregator licence from the IRDAI, and also passed the Principal Officer exams stipulated by the regulator.
The startup then began selling insurance online. The InsureMile website does not ask users for any personal details like many others in the space. It is, quite simply, a website that allows people to explore their needs and choose a policy based on their lifestyle.
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Pick your insurance and claim it too
The startup is working with at least 27 insurance companies, and will also do the claims on behalf of the policyholder. Mallesh adds that the startup is close to selling 100,000 policies this quarter. It also has an app in the offing, to be launched this quarter.
With InsureMile, the Founder aims to help users opt only for policies that make sense for them.
“We are going to have intelligent content to promote insurance buying. For example, young people don’t need Mediclaim policies because they are young and healthy. They need accident insurance, which covers most things under health insurance. Insurance is sold for commission; it has never guided people to meet their targets and goals,” Mallesh adds.
Mallesh and friend Vijay Krishnamurthy pumped in $500,000 together into InsureMile. The startup’s business will not just be with commissions from insurance, but from claims servicing as well.
Building for an uninsured future
Over the next 18 months, InsureMile wants to focus on its app, its physical and digital distribution (events and content) aspects, and figure out ways to engage with the young audience. It is also going to raise more capital in the same period.
According to the IBEF, the Indian insurance industry is expected to grow to $280 billion by FY2020, owing to economic growth and higher personal disposable incomes in the country.
The overall insurance penetration in India reached 3.69 percent in 2017 from 2.71 percent in 2001. It is the lowest for a country with such a high population.
This is why insurtech platforms like InsureMile may exactly be what India needs.
(Edited by Evelyn Ratnakumar)
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