By Paras Mehta, Director of Engineering at Bimaplan
In this digital age, we’ve witnessed a remarkable transformation in the way we handle various aspects of our lives. From ordering medications online to making payments, the ability to accomplish tasks instantly has become the new way as consumers are choosing convenience. Take, for instance, UPI, which enables lightning-fast and secure transactions. Likewise, when it comes to insurance, insurtechs are setting up a similarly swift and hassle-free process, provided that customer security remains a top priority. Customers are now starting to prefer digital modes for their insurance needs, 73%/62% of customers preferred the online mode for GI/HI products. Hence, it’s important to recognise that transitioning to digital policy issuance and ensuring a seamless end-to-end digital customer journey is an absolute necessity. This shift is a direct response to the changing dynamics within the insurance industry and the heightened expectations of customers.
While the industry is creating models to provide convenience and instant solutions, security is also kept at the forefront. Therefore, personal data such as Personal Identifiable Information (PII), KYC and income is restricted to authorised individuals and this data is stored in encrypted form at all times. Insurtech companies are revolutionising the insurance landscape by seamlessly integrating insurance through robust API models.
Insurtechs facilitate secure data exchanges among key players in the insurance ecosystem, such as customers, underwriting and networking partners. It is of utmost importance to maintain encryption for data throughout the digital policy issuance process, ensuring that information remains both secure and protected.
Insurtech companies prioritise the security of customer information by employing end-to-end encryption for data, both during transit and while at rest. They harness advanced encryption technologies like the Advanced Encryption Standard (AES) to strengthen security. AES encryption serves as a shield for a wide spectrum of vital data, including policyholder details, claims information, financial transactions, and communication records. Beyond encryption, insurtechs institute additional security and compliance measures, such as real-time data traffic monitoring, routine security audits, and penetration testing to detect and rectify vulnerabilities. This holistic approach ensures the highest level of data protection, meeting the stringent demands of the digital age, where customer data confidentiality is paramount.
Additionally, the insurance industry is also obligated to follow guidelines given by the Digital Personal Data Protection Act. Compliance with these guidelines ensures that customer data remains confidential and is never shared with unrelated third parties. Furthermore, communication about other insurance plans or products can only occur with the explicit permission of the customer, which is crucial for safeguarding data privacy and security. This requirement emphasises the need for a straightforward and easy-to-implement process. One such approach employed by insurtechs is to secure customer permission through a one-time password (OTP) before proceeding with policy issuance. This permission request is presented in clear and easily understandable language, providing comprehensive information to clarify the purpose and necessity of obtaining consent.
In the dynamic world of insurance, adherence to compliance and robust security measures is the bedrock upon which seamless and secure integration for policy issuance is built. By following these standards, insurertechs can forge stronger, more efficient processes that prioritise customer convenience and benefit. This commitment to compliance and security not only safeguards the interests of all stakeholders but also paves the way for a future where insurers can meet the evolving needs of their clients while upholding the highest standards of integrity and reliability by constantly evolving and integrating newer technologies.