Tipping the delivery person? Pay his insurance premium instead

The next time you order your dinner through food delivery platforms, you might be able to contribute towards insuring the delivery personnel for hospitalisation expenses, instead of – or in addition to – offering a generous tip. Like you, other customers will also make contributions, and the pool will be used to fund the delivery personnel’s health insurance premiums.

New-age general insurer Acko has come up with a product, which has received approval from the Insurance Regulatory and Development Authority of India (IRDAI) under the regulatory sandbox framework. This is the third tranche of products the insurance regulator has approved under this regime. Such products can be launched between July 1 and December 31, 2020, on a pilot basis, for a limited period of time. The purpose of these experiments is to ascertain their acceptability and viability. Let’s take a look at four such ‘innovative’ offerings that are set to hit the market in the coming days

Acko’s crowdfunding of premium

The option to fund premiums is not limited to delivery personnel alone. The idea is to allow individuals to buy insurance for those who are not their family members. “This is not otherwise allowed. We have designed this product keeping in mind those employed through platforms such as Ola or Zomato. Primarily, the focus is on beneficiaries who belong to the lower income groups,” explains Animesh Das, Chief Underwriting Officer, Acko General Insurance. However, those who will make the actual purchase – that is, pay the premiums – will be from the relatively higher income groups.

Acko has identified app-based cab drivers and domestic help, too, as target beneficiary groups. “While the concept lends itself well to platforms such as Ola or Zomato where making such payments is easier, it will also allow, say, an employer, to fund health insurance premiums for her domestic help,” says Das. You can indirectly pay their insurance premiums even now by handing out cash or transferring money to them; but, with this product, you can buy the policy and pay premiums to the insurer directly, while being in the loop throughout the process.

Future Generali Life’s 10-year Insurance Savings Account

Let's say you have a large insurance premium to pay, but your income is irregular and you aren’t sure whether you’ll be able to pay when the time comes. Future Generali India Insurance Co says it has the answer. Aimed at entrepreneurs and self-employed professionals with irregular or seasonal income, this product will allow them to contribute towards a sort of savings account with the insurance company. The annual premium would then be taken from this account.

Given the uneven income flows, some find it difficult to stick to their regular premium commitments over the long term, potentially leading to the policy getting lapsed. “The unpredictability of income forces them to shy away from making long-term premium commitments. They prefer to park their savings in savings bank account or fixed deposits which do not offer them benefits of life insurance cover,” says Rakesh Wadhwa, Chief Customer and Marketing Officer, Future Generali India Life. The company claims that this product will offer them the flexibility to manage the insurance policy as a savings bank account. “It will work like a savings account, with the much-needed life cover,” he adds.

While the product is yet to get the finishing touches, it is likely that policyholders will get to deposit money into this insurance account as and when funds are available during the year, instead of at a particular date. The amount deposited will also earn interest. The company is yet to come with further information on the interest offered and detailed product structure.

Policybazaar.com’s wearable device with Digit Insurance

A regular insurance policy would typically hike the premiums for existing policyholders, even if by a small margin, regularly as we grow older. But what if you are in good health and exercise regularly? Here’s a policy that rewards good behaviour.

Amongst the most popular sandbox concepts, an upcoming insurance policy from new-age insurer Digit Insurance, this one entails a wearable device along with the health insurance policy. The company will keep an eye on you and monitor your vitals. “Ensuring that policyholders maintain good health is in every insurer’s interests. Through the wearable, we can measure and keep track of the policyholder’s heart rate, amount of time spent walking or doing other exercises,” explains Amit Chhabra, Health Business Head, Policybazaar.com. The data that the device collects would help companies understand policyholders, better. Amit says this can help the company offer either discounts in renewal premiums or hike the sum assured in the future. “The idea is that healthy and other customers should not have to pay the same premium. The former deserve lower premiums as the chances of them making  claims are lower,” says Chhabra.

SBI General Insurance’s simplified policy documents

Have you ever studied the large stack of policy terms and conditions and related documents? Chances are that you wouldn’t have opened the docket, much less understood the complex clauses. Now, SBI General Insurance says it has come up with a solution. Under the sandbox regulations, it has received approval for a simplified policy form, which will be a one-pager with a summary of the main features and clauses. Under current regulations, insurers have to send the complete physical policy document to customers. Hence, the sandbox route. “In some cases, this can run into 40-50 pages. Through our sandbox offering, we can send a one-pager which will summarise the coverage in plain English,” explains Subramanyam Brahmajosyula, Head - Underwriting and Reinsurance, SBI General Insurance. The complete policy document will be emailed to policyholders and they will also be able to access the same through a digital locker-like facility. The simplified format can be used for both existing and new products.

Moneycontrol’s take

The regulatory sandbox environment is meant to encourage insurers to come up with novel insurance products and services. Many insurers have already started rolling out such products since February. If you feel that these products suit your requirements, you can sign up. But do not bank on them for your long-term requirements. Treat them as experiments and add-ons to a regular health cover, which is a must in your protection basket, especially in times of Corona.

Source: Money Control