siliconindia | | SEPTEMBER 20259APIs, Open Banking, & Smart PersonalizationTechnology is the biggest enabler of this quiet insurance revolution. Key innovations include:· APIs (Application Programming Interfaces): Allow insurance products to plug into third-party platforms.· Open banking: Enables seamless access to user financial data to personalize insurance offerings.· AI/ML algorithms: Offer personalized underwriting, risk scoring, and premium calculations."We're seeing a convergence of fintech, insurtech, and healthtech, APIs are doing what brick-and-mortar branches could never achieve distribution at scale", says Rakesh Rewari, former Deputy MD at SIDBI and fintech policy advisor.Startups are leading the charge:· Zopper: Partners with retailers to offer device and health insurance.· Toffee Insurance: Offers contextual micro-insurance for cycles, dengue, and backpacks.· Riskcovry: Provides an API stack for insurance-as-a-service across platforms.These insurtech startups in India are turning traditional insurance into modular, bite-sized offerings highly relevant, low-cost, and bundled in user-friendly digital interfaces.Where Embedded Insurance Is Flourishing: Key Sectors· e-Commerce & Electronics: Phone, appliance, and theft insurance via Flipkart, Amazon, and Croma.· Travel & Mobility: Flight delays, baggage loss, or cab ride coverage via Ola, Uber, and MakeMyTrip.· Healthcare & Wellness: Daily hospitalization cover and OPD top-ups via Practo and Tata 1mg.· Fintech & BNPL: Life and accident insurance bundled with EMI cards or credit offerings via Slice, LazyPay, and Paytm."The idea is not to make people go out of their way to buy insurance. Instead, offer it as a default value-added service", says Yashish Dahiya, Co-founder & Chairman of Policybazaar.Impact on the Insurance SectorEmbedded insurance is forcing traditional insurers to reimagine their distribution strategy, pricing, and customer engagement models. It's also opening doors to micro-insurance and customized coverage, particularly for gig workers, rural users, and underinsured segments.But the change comes with challenges:· Lack of transparency: Consumers may not fully understand what they are buying.· Claims friction: Managing claims through third-party platforms can dilute the insurer's brand trust.· Overdependence on platforms: Insurance companies risk losing direct relationships with customers."The biggest risk is the loss of consumer understanding, We must ensure that embedded doesn't become `invisible' in the wrong sense", notes Anand Pejawar, Deputy Managing Director at SBI General Insurance.Regulation and Customer AwarenessIRDAI (Insurance Regulatory and Development Authority of India) has shown support for digital insurance innovation but is also working on frameworks to protect consumer rights, especially for embedded models."We welcome innovation but will not compromise on transparency,Customers must know what they are paying for, how to claim, and who is responsible", said Debasish Panda, Chairperson of IRDAI, at a 2025 digital insurance summit.Digital platforms must be held accountable for disclosures, opt-in clarity, and claim support. As more embedded products go live, financial literacy and digital insurance education become essential.ConclusionInsurance 3.0 isn't about banner ads, insurance agents, or paperwork. It's about access, timing, and relevance. Embedded finance is helping India democratize risk coverage, especially in Bharat India's semi-urban and rural heartland where traditional insurance models often fail."We're not just selling policies. We're creating access to safety nets, Insurance is becoming ambient always there, always on, when you need it most", says Varun Dua, Founder of Acko Insurance.
< Page 8 | Page 10 >