This presentation explains the process of Insurance in a very Simplistic and schematic way. It starts with the definition of Insurance and moves onto the types of insurance like life insurance, general insurance, P&C insurance, Auto insurance etc. It explains the insurance industry sales channels and the customer purchase process. The presentation also looks to explain the claims process. It suggests, citing statistics from various sources, that insurance industry will have to go thorough digital transformation as it will benefit both the insurers and the customers.

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Basics of Insurance

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In boring terms Insurance is…
Definition of Insurance
“An arrangement by which a company or
the state undertakes to provide a
guarantee of compensation for specified
loss, damage, illness, or death in return
for payment of a specified premium.”

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Lines of business (LoB)
Life Insurance
Non Life Insurance
Health Insurance
Insurer promises to pay a designated beneficiary a
sum of money (the benefit) in exchange for a
premium, upon the death of an insured person
Provide payments depending on the loss from a particular
financial event. General insurance is typically defined as any
insurance that is not determined to be life insurance
Type of insurance coverage that pays for medical
and surgical expenses that are incurred by the
insured

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Insurance line of business
Auto/Motor Insurance
Property Insurance
Pecuniary loss
Freight
Genera liability
Non-life insurance
Whole life
Term life
Endowment
Annuity
Investment linked
Life insurance
Accumulate wealth. Regular premiums pay insurance costs and
contribute to equity growth in a savings account where dividends or
interest is allowed to build-up tax-deferred
Provides coverage at a fixed rate of payments for a limited period of
time, the relevant term
Designed to pay a lump sum after a specific term (on its 'maturity')
or on death
Save money for retirement. Premiums earn interest, generally tax-
deferred, and after a period of time, provide with a stream of
income
Unit Linked Insurance Plan (ULIP) unlike a pure insurance policy,
gives investors both insurance and investment under a single
integrated plan
Marine, Aviation & Transport
Other non-life
Protect the general public from any accident that might take place on
the road
Coverage for monetary loss due to a wide range of factors from
external and internal influences
Provides financial reimbursement to the owner or renter of a structure
and its contents, in the event of damage or theft
Indemnifying the policyholder against loss of the freight money if the
ship-owner cannot complete his contract of carriage because of
unavoidable peril
Protects the purchaser (the "insured") from the risks of liabilities
imposed by lawsuits and similar claims, within the coverage of the
insurance policy
Covers the loss or damage of ships, aviation, cargo, terminals, and any
transport or cargo by which property is transferred, acquired, or held
between the points of origin and final destination

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Sales channels
Agents
Brokers &
advisors
Bancassurance
Direct sales
staffs
Internet
Registered agent for one or more insurers. Gets paid
through commission from Insurers
They act on their clients' behalf to negotiate and obtain the
most appropriate insurance covers at competitive premium
rates from their insurers, exercising care and skill in doing so
Selling of insurance products and services by banking
institutions
Selling by the direct staffs of insurance companies
Selling through digital/mobile channels
Channel Description Commission
From Insurer
From Insurance
advise seeker/
Insurer
From Insurer
Salary from
Insurer
IntermediariesDirect
39.4%
30.7%
29.1%
29.2%
31.1%
28.9%

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Customer purchase process
Underwriting

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Insurance claims process

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Insurance will have major digital transformation
000

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Key terms to know
• Insurer: A person or company that accepts the risk of loss and compensates the
insured in the event of loss in exchange for a premium or payment. This is usually an
insurance company
• Insured: The person or company transferring the risk of loss to a third party through a
contractual agreement (insurance policy). This is the person or entity who will be
compensated for loss by an insurer under the terms of the insurance contract
• Insurance Rider/Endorsement: An attachment to an insurance policy that alters the
policy's coverage or terms
• Bound: Once the insurance has been accepted and is in place, it is called "bound".
The process of being bound is called the binding process
• Reinsurance: Insurance that is purchased by an insurance company from one or more
other insurance companies as a means of risk management or sometimes tax
mitigation

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About RapidValue
RapidValue is a leading provider of end-to-end mobility, omni-channel and cloud solutions to
enterprises worldwide. Armed with a large team of experts in consulting, UX design, application
engineering, testing, along with experience delivering global projects, we offer a range of services
across various industry verticals. RapidValue delivers its services to the world’s top brands and
Fortune 1000 companies, and has offices in the United States and India.
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