The COVID-19 pandemic has given rise to the need of going digital a tad bit more than the usual with social distancing being the call for the hour. However, cybercriminals around the world are taking advantage of this situation by compromising the security net across the financial and banking sector and talking the focus on various cyber-related investments. So the question is whether or not this will inflate the cyber budget for numerous financial institutions. The current situation has forced the insurance companies to adopt more of a digitalisation method in a way that had previously happened during demonetisation.

For the insurance industry, in particular, it’s majorly a digitise or die situation especially when they have to be agile as well as relevant to their customers. One also wishes to be familiar and fluid. When it comes to discussing the sudden boom in the digital adaptation, the role of various insurance companies in handling it and the significance of cyber-related budget Avez Sayed, the chief risk officer of SBI General Insurance says, “insurance is a very old subject and involves people too often end up buying insurance and we also have customers who are millennials and are keen in buying more and more insurances in the form of session insurances, such customers do not want many questions to be asked. Youngsters nowadays are buying insurance for purchasing high-end gadgets or even for getting a bicycle. Thus, our concern is how do we ensure these products”. 

A recent report by a professional services firm PwC states that the two productive months for the insurance industry - The March for life insurance as well as the April for non-life corporate renewals have been strongly hit by around 30% and 15% respectively. It also emphasises largely on the changes that the insurers will have to bring about with respect to the terms of their product categories. According to the same report, most of the private health insurance schemes cover a little over 14% of the population in rural areas and only 18% of the population in urban areas. As far as the General insurances are concerned, a large proportion of this industry is highly dependent on business and industries such as travel, automobile, hotels as well as infrastructure. Thus, the numerous challenges in these sectors due to the nationwide lockdown could create additional issues.

For motor insurances, on the other hand, the claims have dropped down to less than 5% of the normal that has led to sufficient savings for insurers. Up until June this year, the industry has seen significant down growth in the motor segment specifically by 11%. In a crisis like this, there is a constant need and rush to increase one’s cover under life insurance. Which is why the consumers are very much inclined towards pure protection covers that lead to an escalated demand for term plans says Rushabh Gandhi, the deputy CEO of India First Life Insurance Company Ltd.