Product Innovation in Insurance: The New Imperative for a Comfortable Retirement
Insurance companies primarily create exciting products around emerging risks and consumer trends. Often considered a necessity, the simplicity of products overpowers innovation. Given the increasing lifespanand evolving lifestyles,the industry has witnesseda shift in demand towardpicking the right insurance policies.Sanjay Tiwari, Chief Strategy Officer, Exide Life Insurancestats thatcurrently, the global populace is experiencing a revolution in longevity. Since most nations harbour a growing aged population, there are significant implications on their socioeconomic and health parameters.
Therefore, insurers strive to create a personalised experience for customers and innovate products that would suit their overall financial goals– not just in the short term but post-retirement too.
Longevity and Medical Expenses
With changing times, the concept of ageing has evolved. Today, successful ageing is linked with the ability to live a comfortable life withindependence.As per Sanjay Tiwari, Chief Strategy Officer, Exide Life Insurance, everybody desires to retire rich to be able to lead a comfortable post-retirement life.However, with and inflation this becomes more difficult over time. High inflation could nudge people into making certain discretionary lifestyle changes after retirement.
Driven by soaring healthcare costs exacerbated by the outbreak of COVID-19 pandemic, managing medical expenses emerged as a potential cause for concern in future that may exhaust retirement savings. Along with taking care of themedical expenditure that keeps rising well above the average rate of inflation, individuals need to set aside a large part of their savings for a post-retirement corpus for an undisturbed comfortable life. Dealing with the expenses for your partner’s wellbeing can also erode retirement savings where recurring expenses could derail even the best retirement plans.
Thus, it is important to allocate money wisely to enjoy one’s retired life. Whatever the retirement goal may be, the longer the period of investment and savings, the better one will be toenjoya hassle-free post-retirement life. Retirement planning done right and strategic investment in the right plan can ensure a comfortable and independent retired life.
For those looking forward to make the best out of their second innings and do everything they love, be it traveling round the world, pursuing hobby activities, or even just spending a life with complete financial independence, there are a few options to address the situation. Investing in the right retirement plan helps build a huge corpus over time and manage unforeseen emergencies in a person’s post-retirement life.These plans include certain life insurance policies or even long-term care insurance plans that safeguard one’s savings.
Bespoke Insurance Plans
There are several plans to meet this need. For instance, Exide Life Smart Income Plan is one such policy that provides guaranteed income benefits along with the flexibility to choose between two benefit options during the policy inception stage. Also, an individual could consider consulting their insurance advisor about long-term care options between the age of 45 and 50 years. If an individual plans to buy a policy of this kind, it should be done at an earlier age to balance the costs and benefits.
For individuals worried about whether they will have adequate financial resources post-retirement, hiring a financial advisor to work out a specific plan could be the best way to cope with monetary worries.
The introduction of data-driven products and personalized solutions is now reshaping the retirement segment. Consequently, this represents a huge opportunity for the industry to deliver better outcomes across the ecosystem. With robust availability of data, information insights to drive better outcome and AI-enabled tools to support informed decision-making, financial services firms can offer more relevant and connected consumer experiences while accelerating and planning their growth.
In turn,this will optimize product performance and aid in creatingbespoke products and services for customers.Thereby, insurers can enhance fiduciary oversight and mitigate risksas required while they also enhance overall efforts and outcomes.
Advantages of Data-driven Solutions
Despite such opportunities, many industry players are yet to realize the full potential of data-driven products and personalized solutions. Some remain resistant to change, perceiving the barriers to adoption as too huge. This hesitation can be due to a lack of understanding, resources and expertise. Given the pressure that the industry confronts today with regard to retirement, this is understandable.
Many insurers find it tough to retain relevance, leave alone moving ahead of the industry’s innovation curve or their customers’ evolving expectations. Therefore, insurance players need to take a holistic view of their consumer data, thereafter integrating relevant insights into the retirement ecosystem to create real value for their business as well as customers.
Sanjay Tiwari, ChiefStrategy Officer, Exide Life Insurance