The way we shop has changed spectacularly since the pandemic hit. Similarly, consumer habits with financial services (and insurers) are growing more digitally savvy.
Thanks to technological advancement, apps and financial tools are more sophisticated than ever before. As a result, more of us are going digital in our financial pursuits.
The 2020 Customer Satisfaction Index of Singapore national study conducted by the Institute of Service Excellence (ISE) at Singapore Management University (SMU) revealed that more consumers are embracing digital channels for financial services.
Think purchases via credit card, internet banking and interacting with insurers.
Much like how the pandemic has impacted the way we shop and approach our finances, there has been increased headway in digital adoption for other sub-sectors in the finance category, namely insurance.
Consumers rated insurers with digital channels higher on perceived value and loyalty
Keep in mind that when we talk about digital channels, we’re referring to apps and websites. Now that we rely on our apps for practically everything, it’s clear that consumers are also adopting these channels for their insurance needs.
This could mean that insurers with a stronger digital presence are now reaping the rewards as survey findings show that these insurers score higher in customer satisfaction.
Adopting digital channels to do research before purchasing
Aside from interacting with their insurers, consumers are also turning to digital channels to find out more about policies before making the purchase. This could range from insurer websites to comparison sites.
Buying insurance from an advisor is still the go-to option
However, even as consumers are more comfortable with utilising digital channels when exploring insurance matters, there’s still some ways to go when it comes to actually buying a plan online.
The survey showed that buying through a financial advisor is still the most preferred channel. But this does not mean that buying insurance without an expert is a lesser option. In fact, there are many benefits to going down the DIY route.
Why you should consider buying insurance products online
1. Save on admin and processing fees
If you’re looking to save, buying insurance online will help you do just that. Without a financial advisor doing the heavy lifting for you, your insurance repayments will be lower. This is because you won’t be charged on things like agent’s commission.
Better yet, buying insurance plans allows you to enjoy attractive deals and promos, potentially saving you more in the process. Your wallet will thank you!
2. Buy what you need in an instant
Once you’ve put in the hours of researching and are dead-set on the right insurance plan for you, your next step is simply to take the leap of faith and buy it online. Buying it yourself speeds up the process considerably.
On the downside, if you still can’t decide on the right plan, it’s best to get a financial advisor involved to help you make that decision.
3. Avoid being upsold
We’ve all been in uncomfortable situations where we felt pressured to buy something just because we got in the crosshairs of a very pushy salesperson.
This might — but not always — happen if you have the misfortune of engaging the wrong financial advisor. Purchasing a plan yourself eliminates this possibility altogether.
Types of insurance plans you can buy online
Visit any reputable comparison site or directly go on any insurer’s website and you’ll find all the information you need to get started and buy a plan.
There are certain types of products that you can buy on your own as they do not require financial analysis or health underwriting (unlike health insurance). These are known as general insurance.
Once you know the value of your home’s covered assets (this includes your belongings, furniture, renovation, clothes, appliances, etc.), you are well-equipped to find a home insurance plan that offers sufficient coverage.
Coverage is of importance here as you wouldn’t want to be under-insured. Being under-insured means buying coverage that’s only worth $35,000 when the combined value of your assets add up to $50,000.
As the key ingredient to a stress-free trip, travel insurance saves you more than just medical expenses and cancellation costs — it can also cover you for Covid-19, high risk activities like extreme sports, expensive equipment in case of loss and theft, and even terrorism.
Most insurers give you the option of a single-trip or annual policy. Do the math when selecting a plan to ensure you have an adequate sum insured.
Buying car insurance online is pretty clear-cut.
Once you find the best deal, be sure to get a quotation online from your chosen car insurance company as premiums vary depending on your diver’s profile (occupation, driving experience, etc.) as well as your car type (engine capacity, age, etc,).
If you have a big personal milestone that you hope to achieve, buying an endowment plan helps you reach your goal in the form of guaranteed and non-guaranteed returns. Typically, the ones you can buy online are short-term endowment plans.
To get started on the right foot, you’ll have to know the desired amount you need to reach your goal.
Other factors to consider include rate of return (ideally higher than inflation rate), capital guaranteed (this will tell you if you’re getting back the amount you’ve put in once the plan matures) and sum assured (the amount you will receive at maturity).
This article was first published in SingSaver.com.sg.