Expect more innovation around blankets in the near term: Edelweiss GI’s Shanai Ghosh

Edelweiss General Insurance was founded 4 years ago with product innovation, customer experience, delivering better value and reducing red tape as differentiators. The strategy has worked for the company because in the current year it has already grown by 66%, which is around 6 times the growth of the industry. In an interview with business todayShanai Ghosh, Executive Director and CEO of Edelweiss General Insurance, explains what is driving the company’s growth and how COVID has proven to be a tailwind for the company.

BT: How has the insurance market evolved after Covid-19?

Shanai Ghosh (SG): One is the acceleration of digital transformation. Previously, it was for a beautiful thing, it was also an important agenda. But now it has become absolutely imperative, whether you are a starter or a challenger. Thus, investment in technology has increased. The adoption of digital by customers and partners and other players in the ecosystem, such as garages, hospitals, has increased, which is a good thing. The second good thing that has happened is that the focus on health has increased across the industry and it is also the need of the hour for the country. With 60 to 65% of health expenses remaining the responsibility of the Indians, there is a crying need for insurance to take more and more of this share. With 32 companies coming to help, I think health insurance penetration should increase.

Another area the industry has experienced is the “Pay as you use” model for auto insurance within the regulatory sandbox. Worldwide, I think it’s a growing segment. And therefore India, I don’t think it will be any different, because Indians are very value conscious, they don’t want to pay a rupee more than they have to. So I think it appeals to that values-conscious mindset. Since this is a new concept, it won’t be all the rage overnight. Once people understand the concept, understand the convenience, and understand the value, I’m sure there will be adoption. Of course, I’m not saying that 100% of the auto insurance market will migrate. But I would say that a significant portion of the auto insurance market will be people who want to save because they don’t drive enough.

BT: What kind of growth did you see in FY21-22?

OS: We are a digital organization by design. We were cloud native from day one. Our entire workforce is mobile, working only on laptops. All of our apps are in the cloud. When working from home came along, for us it was just a different place. We worked exactly the same way. Our processes were digital by design.

We continue to grow. And we haven’t slowed growth for a single month, even during the pandemic. For FY21, we achieved 49% growth, approximately 8 times industry growth. For the current year, we have recorded a growth of 66%, which is approximately 6 times the growth of the industry. Over the past 2 years we have consistently been in the top two to three players growing up. Covid has actually been a tailwind for us. And we believe this has been possible thanks to our Digital First approach. Our message and our differentiation seem to be accepted by both our customers and our partners. We have partners like Ola where we first created a COVID product for the driver community in March 2020 and this is the third year we have used this product with them. We have many partners like regular OEMs, NBFC. We are also creating an open insurance platform where anyone can partner with us through open APIs. We are building a fully serverless architecture that helps different partners across the ecosystem to work with us.

BT: What will be the growth drivers for the insurance sector from now on?

OS: In terms of growth drivers, I think healthcare continues to be a growth driver for the industry even in the current year. The other thing the industry is looking at is the new category of electric vehicles (EVs) that’s coming, how to create products that will address that risk, because that’s a very different category. A lot of research on electric vehicles needs to be done before creating insurance products.

We should see more and more innovation around short-term, timing-based hedging. There are products that you need for a certain period of time, and you’re done. For example, flight cancellation, sports injury cover during a tournament, home cover during the holidays. Although this is covered by some travel insurance, it is simply a matter of unbundling and providing just that. This is what we call the on-demand class of insurance. That’s what we’re talking about when the engagement times are really short, you can just turn it on. It could be as short as a day too. These are the one-off insurance covers that we offer. People don’t want to be locked in long term. It’s this huge on-demand economy that affects all products and services, so insurance should be no different and we believe we need to meet the demand of millennial or gen Z customers.

BT: What are some of the emerging trends?

OS: The big trends are digital transformation, on-demand products, etc. On the health front, trying to create not just wellness-based products, but trying to provide value-added services to health insurance customers. Create a platform to provide health insurance customers with a broader set of services, having links like telemedicine and other types of pharmacy links. Trying to increase the OPD coverage offered to clients because today the products largely only cover hospitalization and pre- and post-hospitalization. But extending this OPD coverage beyond this pre- and post-hospitalization is another trend we will see. And in health insurance, I think offering much more holistic coverage through closed networks is also going to be something you’ll see a lot explored. Today, we see a lot of subscription health models, which are not necessarily insurance, but they are all based on the closed network, they are articulated with one or two hospital chains and offer this kind of model. But in the end, there is health insurance. So, as you have a concept of preferred auto garages, you might have preferred hospitals, where you are able to provide additional services to customers.

At EGI, we have links with a network of hospitals, which will give you guaranteed admission, admission without deposit, etc. For our clients in these network hospitals, we can say it is deposit free, you don’t need to pay any deposit, you can just be admitted. Another issue for clients is the waiting time after discharge from hospital. We have identified 19 procedures that we call zero minute discharge. Someone can just walk out of the hospital, when the doctor comes out, you don’t have to run for those four five hours. Another is flight cancellation. If you cancel a flight, generally you go to the call center, or you go to the insurer’s site, see the name of the flight or cancel a flight and give the proof, etc. What we’ve done is an API integration with ClearTrip, where if you buy and cancel on ClearTrip, the details are immediately passed to us, we’ll trigger a link to the customer, and the customer just has to fill in their bank details, and payment will be made instantly.

BT: Edelweiss GI is one of the digital-focused insurers. How do you intend to counter the traditional players?

OS: Digital is our platform to help us achieve this goal. And we have demonstrated that over the past four years. In product innovation, we have created Switch, which is India’s first on-demand auto insurance product, switch on and off type of product. And it’s the only app-based subscription product the country has ever seen. It is a truly innovative product, not only in insurance, but also in mobility service and the use of technology to transform the customer experience. Another innovation is Health 241. Through research, we have realized that healthy young people don’t necessarily want to buy health insurance because they think it will be a waste if they don’t claim it. We overcame this hurdle with Health 241, where if you don’t claim the first year, the second year is on us. We target and try to convert younger audiences and engage them earlier in health insurance.

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Michael J. Chiaramonte