When you think about it, insurance is a really strange concept. It’s one of the few products that people buy while hoping they never actually have to use it. Unfortunately, in the event that we do have to “use” our insurance, the cumbersome process makes it an unenjoyable process.
In this podcast with MoneyFM 89.3, hear what PolicyPal’s CEO and Founder, Val Yap, has to say about why insurance is so painful for us consumers — and what we’re doing to change things.
Who is Val Yap?
For the uninitiated, Val Yap is the Founder and CEO of PolicyPal and has recently been featured on Fortune’s 40 Under 40 list.
Val founded PolicyPal after a series of family tragedies, during which she had to deal with insurance claims. It was through these painful and heartbreaking experiences that Val realised just how difficult it is for consumers to deal with insurance.
Ironically, far from providing assurance and support during difficult times, dealing with insurance matters actually added to her troubles.
“As a consumer, when I buy an insurance policy, I want peace of mind and to take care of my family when something bad happens,” she says in the podcast. “But, the whole experience that I went through wasn’t that comforting.”
You can listen to the podcast to hear Val’s story or read about it here.
PODCAST: Val Yap x MoneyFM
Here are Val’s insights on the five biggest problems that consumers face when dealing with insurance.
Pain point #1: We don’t understand our existing insurance coverage
The very first problem with insurance, according to Val, is that people do not understand what they have.
Most consumers don’t actually read our insurance policies, let alone understand them. And who could blame us? Insurance policies come with legal contracts of about ten to 20 pages long, and they’re not exactly light reading.
What makes matters worse is that insurers use different terminology to describe the same things. That makes it difficult to understand what coverage we actually have, and whether there are overlaps or gaps in our coverage.
Older users may also be underinsured by old insurance policies. For example, if you had bought a S$10,000 insurance policy 20 years ago, this sum would not be enough to cover today’s expenses.
As Val points out, consumers actually need to continually revisit and maintain their insurance portfolios, just like what we would do with our investments.
PolicyPal solves this in two ways: first, by digesting the policies that users upload on the app, and second, by connecting users to licensed advisers who can explain them in actual human language.
Pain point #2: Insurance is too “chunky” for us to wrap our heads around
Another reason that people have a poor impression of insurance? The products, especially life insurance products, can be too intimidating for us to understand and wrap our heads around.
In Val’s words, PolicyPal aims to “break down chunky and complex insurance” so that users actually understand how much they’re paying and what they’re paying for.
Not understanding your own insurance coverage can lead to serious issues, as Val experienced first-hand when she tried to settle her mother’s insurance claims in 2013 upon a cancer diagnosis. Unaware of her actual coverage, Val’s mother was unsuccessful in getting her insurance claim.
By helping people understand and break down their insurance policies, PolicyPal hopes to improve the insurance user experience and shorten the claims process.
Pain point #3: Why does one person have to have so many different logins?
Another common pain point when it comes to managing our insurance is how decentralized all the information is. Val describes it perfectly in the podcast: “I am just one person — why must I have so many logins?”
You can streamline it by personally buying insurance policies from one provider and thus having only one point of contact (your agent). But, what if you need to manage your family members’ policies one day? You might still encounter this issue, as Val did in 2013 when she had to manage both parents’ policies.
To cut down this hassle, she started PolicyPal with the aim of helping people consolidate their policies in one place. Apart from managing your parents’ and children’s policies, you can also manage your employee insurance if it was purchased through us.
Pain point #4: Young people don’t understand their hand-me-down insurance policies
Another common issue that the traditional insurance industry has failed to solve is the problem of “hand-me-down” insurance.
Many Asian parents buy insurance for their children with the best of intentions. But when the kids grow up, graduate, and take over their insurance premiums, they end up wondering: What exactly is this? What am I paying for?
In some cases, this leads to young adults giving up the insurance policies they do not understand, and becoming under-insured.
To address this generation gap in insurance, another mission of PolicyPal is to improve financial literacy through games and content to help the younger generation understand the value of protection.
Pain point #5: Insurance is not personalized or user-centric enough
In the internet economy, personalization is no longer a nice-to-have — it is a must-have. Imagine if you opened your Netflix app and it gave you a generic menu of shows instead of personalized recommendations based on what you like!
To this point, the insurance industry has not yet leveraged on data to get users hooked yet. As Val says in the MoneyFM podcast, insurance is still hugely dominated by the big players, with banks representing about 40% of the insurance distribution market in Asia.
That’s why PolicyPal is now looking to work with insurance partners to co-create modular products that can be tailored to user needs.
Working with the other partners in our parent company AMTD’s network, we have a wealth of data when it comes to understanding the financial obligations, needs and transactions of our customers. Thanks to big data, we can assess the risks consumers are facing in real time, and provide micro-insurance in a seamless, unobtrusive, non-pushy way.
More importantly, PolicyPal puts the consumers’ needs front and centre, giving us all the freedom to opt-in to affordable insurance coverage only where needed.
Enquire More and Contact Us Today!
Learn more about how to manage your insurance policies and identify your coverage gaps.
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Header image credit: MoneyFM
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