Shopping for insurance? Try online

Want an insurance cover for your family, but don't have the time to run after the agents of various companies to decide on a product? Internet's the way to go for you. With policies and products available online, the cheapest deal could be just a click away.

Why online? At present, most people buy insurance products through an individual agent or a bank. However, these entities normally deal with products of only one company. So, you may not get the right deal at the right price from them.

The new insurance shopping websites act as online brokers and help you access and compare deals offered by various companies, and then pick the one best suited to you. Normal brokers, too, serve the same purpose, but their operations are largely restricted to high volumes and, hence, their main clients are corporate houses and big organizations.

Online bargains India's first insurance shopping website, www.insurancemall.in, through its associate firm, Bonsai America, has paved the way for the online insurance seeker. "We give customers the choice to buy any of the existing products," says Mahavir Chopra, chief financial officer (new businesses). Insurance Mall currently offers only general insurance products, but plans to start transactions in life insurance products by the end of July 2007.

Another entrant in the online insurance sector is www.getmeinsure.com. This site, however, is restricted to making comparisons among various plans. "As of now, we do not offer buying on our website but it will be introduced as and when the market is ripe," says Aditya Dwivedi, founder director and chief marketing officer.

General edge. For those looking for general insurance products, such as health, home, travel or car insurance, the online version can be a boon in the detariffed regime. Even pension plans provided by life insurers that come without any life cover are ideal online plans to buy.

In the detariffed regime, general insurance companies have been allowed to fix their own prices for products offered by them. Competition among insurers has led to falling prices. But, to zero down on the cheapest deal, one needs to know about other deals too. Buying insurance online makes the task easier.

"Post-detariffing, the premiums have fallen; they could fall further if online purchases pick up as the insurance companies would then pass on the agent commissions to their customers," says Dwivedi. Some past researches prove this. According to a study done in the US in 2004, the rise of buying on the Net reduced the cost of term life prices by as much as 10 to 15 per cent.

How to go about it. The process of online buying is as simple as it sounds. "Just a few clicks are all that is required," says Chopra. Once the applicant puts in the relevant information, the site lists the available options. The applicant then has to choose a suitable plan and purchase it online. Detailed brochures on each of the policies are also available.

Limitations. All life insurance products should not be bought over the Internet. Planning for retirement, or saving for children, needs focused attention of trained insurance professionals, which may not be available online.

Among the bouquet of health insurance products, only those are available that don't require medical tests. There are no life insurance products on offer yet. Also, the websites do not have all available offers from existing insurers as of now,

Words of caution. Always read the privacy policy carefully to make sure the site doesn't misuse the information you provide. Look for the little lock symbol at the bottom of your web browser screen to make sure that you are on a secure site.

Buying three policies - say a health plan, a car insurance and a term insurance - from three different insurers may make you end up running after three agents of various companies. A broker servicing all the three products and, that too, online, is the way to the future.