Globally, insurance companies are increasing investment in digital technologies, but Indian firms are lagging behind, a report said.

“Global average investment in digital technologies is increasing over the years, while the insurance industry in India is lagging, both in its level of digitalisation and its ability to realise financial returns on its digital investments,” a CII-PwC report on ‘Evolving considerations for the Indian insurance industry’ said.

With increasing smartphone penetration and internet access, insurance companies will need to strategically adopt the technological infrastructure required to launch products that meet customer needs, it said.

Moreover, leveraging low-cost digital distribution channels for sales and service is likely to play a significant role in helping insurance companies deepen market penetration, it added.

Simplification of process will also lead to some degree of uniformity in the expectations of customers in their interactions with multiple insurers, it said.

Instead of all risk products, people are demanding simple one-risk cover products, which are easy to understand and allow customers to choose discrete individualised need-based covers, it added.

The report also said that with digitalisation, insurance companies should be wary of new modes of fraud.

Low-cost digital distribution channels for sales and service will play a significant role in helping insurance firms deepen market penetration, says CII-PwC report