EP 122 – Sarbvir Singh – CEO at PolicyBazaar – Technology Platforms Tend To Bring Transparency

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Michael Waitze worked in Global Finance for more than 20 years, employed by firms like Citigroup, Morgan Stanley and Goldman Sachs, primarily in Tokyo.  Michael lived and worked in Tokyo from February 1990 until December 2011.  Michael always maintained a particular focus on how technology could be used to make businesses more efficient and to drive P/L growth. Michael is a leader in the digital media space, building one of the biggest and fastest-growing podcast listener bases in the region.  His AsiaTechPodcast.com show has listeners in more than 130 countries and his company, Michael Waitze Media produces some of Asia’s most popular podcasts.

Sarbvir Singh heads Policybazaar.com, India’s leading insurtech company. He is responsible for the overall business performance of PolicyBazaar. Prior to joining Policybazaar, he was a venture capitalist and also served in senior leadership positions with digital and media companies. He was most recently the Managing Partner of WaterBridge Ventures, a leading early-stage venture fund.  Over his career, Sarbvir has led venture investments in industry-leading companies like BookMyShow, Yatra, DoubtNut, ZipLoan and Webchutney. He served as the founding Managing Director of Capital18, Network18’

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The Asia InsurTech Podcast spoke with Sarbvir Singh, the CEO of PolicyBazaar, about the future of the insurance industry in India and the power of data analytics.

Find the transcript of our conversation here: 

Michael Waitze  

Okay, we’re on. Hi, this is Michael Waitze. And welcome back to the Asia InsurTech Podcast. This is the only podcast in Asia focused on insurance that gives entrepreneurs, thought leaders and investors a platform to discuss how technology is reshaping the insurance industry in Asia. Today, it should be a good one, I am joined by Sarbvir Singh, the CEO of PolicyBazaar. Sarbvir it’s very nice to have you on the show today. How are you doing?

Sarbvir Singh  

Great, Michael, it’s great to be on the show, and good to meet you.

Michael Waitze  

It’s very nice to meet you as well. Before we jump into sort of the main topics, what do you think is the biggest trend in insurance and InsurTech in India, and by extension, the rest of Asia.

Sarbvir Singh  

So Michael, there are two main trends that are taking place and I’m looking at it from a lens of not just the last one year or two years, but looking at it over like a 5-10 year period. So if you think about it, there are two main things that are happening. One is the growth of protection products in insurance. So traditionally, insurance in India, and India has a rich tradition of insurance. So you know, we’ve had insurance companies since the late early 1900s, and things like that. And, and the main thing was that they were selling what our traditional insurance products, which are generally distributor friendly, but not customer friendly, they tend to be a mix of investment and insurance, what has changed in the last, I would say 10 years or so is that there has been a greater focus and understanding that insurance is to protect yourself against, you know, once in a one of events, and when those one of events have very high impact. So the frequency may be low, but the impact is very high. And a family needs to protect itself from that. And as you know, here’s a large middle class in India. And given the structure of the country, we don’t have a lot of social security or social security nets, which you know, some parts of the world have. So that makes it you know, doubly important that you need to protect your income and your family’s household from any kind of one of event. So the most important trend is this rise of protection products, which means health insurance, that means that if you’re if you’re hospitalized, you get paid that claim gets paid. The second is term insurance, where it is a pure risk cover, where if you something were to happen to the chief wage earner, the family will get a significant sum of money, which will allow them to at least monetarily manage despite the chief wage earner being gone. So this this trend of protection products, to my mind is one of the most important trends in insurance in India. And the second trend, which is very important, which is I guess, which brings the InsurTech into our discussion, which is that this growth and both are actually intertwined. This growth of protection is being led by the technology players, because it is easier. So there are two reasons. One is that technology platforms tend to bring transparency into the system. So if you look at PolicyBazaar, we allow you to see various policies, we are not saying this is good or this is bad, you can see the policies, and you decide. So that transparency is there. And the second thing is the cost of doing business is lower in a technology driven platform. So for some of these risks covers where the value of the insurance policy may be lower than what you know, traditional policies could be the commission while it’s lower on in absolute, rupees or dollars, because of the efficiency that we bring to the table we are able to sustain. So we are not you know, as focused on the one transaction, we have a volume of transactions that we are focused on. So these are two big trends, protection and digital which are sort of coming together.

Michael Waitze  

Got it. There’s a ton of stuff to unpack there. And before we do that, kind of for a little bit more context, you know, I introduced you as the CEO of PolicyBazaar I think that’s a relatively new thing for you, I just kind of want to jump back a little bit and talk about your career path into insurance, because in many ways, it wasn’t a direct straight line, although there is a line at the beginning of the line kind of today that should connect. Is that fair?

Sarbvir Singh  

Yes, I totally agree with you I am in my experience with insurance is only about two years or less than two years old since I joined PolicyBazaar. And you know the the dots as they say connect in a in a fairly sort of complex way. And you know, Yashish was the founder of PolicyBazaar and you know, we were at IIT Delhi together, you know, 30 years ago and, you know, he was actually junior to me, so I you know, when he came in and we were in the same hostel, etc. And as it also turned out that, you know, both, his father was an army and my father was an army too. So it also had we had some kind of a very, you know, tenuous connection from that side also. So we just kind of you know, bonded and we knew each other very well on campus. And then of course, we went to the same business school also, as coincidence would have it together. So we overlapped about for a year. And then I think I know, we went our separate ways I was working abroad, he, you know, he was working in London and stuff like that. But somehow over the years, we kept in touch. And I was very much aware of PolicyBazaar. And when it was started, and I was a venture capital investor at that time, so, you know, obviously, we were, we also spoke at that time, you know, things happen when they happen. And at that time, nothing really worked out. And over the years, I have known him, I have known many people in the PolicyBazaar system also. So Alok, who is the co founder, you know, I’ve known Alok also for, like, 12-13 years. And so, you know, we just kind of were in touch in four different things at different times socially, you know, once or twice a year. And then, you know, this, this whole discussion started about, I think, Yashish feeling that PolicyBazaar needs to have maybe a little bit more depth in on the senior management side. And for me, at that time, it was a difficult call, I had just started a venture capital fund of my own with with a partner, and we had just raised our second fund. So you know, that that kind of made it more real, right, if you have a first one, you know, who knows where it’s going? You know, things look a bit more, shall we say, robust? But, you know, it was a great opportunity. And when we spoke about it, I was really excited. And I think I would, I dare say that in the two years since I, you know, we’ve, we’ve been together, I have never felt I’ve just felt that the decision was a good one every day. So that is a unique thing. Because typically, you know, there are some days when you feel like, you know, God, why did I. But I should, this has not been the case in this relationship there. 

Michael Waitze  

But I think it’s really fascinating, actually, the way the sort of serendipity of meeting somebody. I mean, obviously, the quality of people at IIT Delhi is amazing, right, but just the serendipitous meeting of two people 30 years ago, and then they’re just sort of continuous up and down relationship or connected relationship leads into this. It’s just really interesting. And the idea that you’ve been in sort of the finance world, and sitting on what we always call the other side of the table, essentially, right, as an investor, and then running your own venture capital fund, which is kind of different, but not so different, in a way, if you think about it, right? Managing assets, managing liabilities, looking at sales and distribution, it’s all very similar at some level. It’s just neat that in the end, you end up together again.

Sarbvir Singh  

It’s a unique, you know, coincidence, I mean, unique event, actually, right? Because so long and stuff. And, of course, the other thing, I will say, you know, when you use, I always respected and I think there’s a strong sense of mutual respect between us. And, you know, always when I saw PolicyBazaar, from a distance, right? Well, you know, from a distance, you only know so much about the company. And, you know, you always believe the best right, that everything is going well. But ever since I’ve been part of the system, I have to say that my admiration for Yashish, you know, has grown and I feel like he’s really done a great job. And, I mean, there’s a saying in, in, I think, in British time, they used to say that, you know, if a man is respected by his butler, then he is truly a great man. So, if you get that, you know, analogy. I think once you get to know somebody worms, and all right, if you’re still out respecting them, then I think that’s a big deal.

Michael Waitze  

I think if you go back to 2008, you look at the founding of PolicyBazaar. Just the vision of building something like that kind of before, it was trendy, is kind of amazing. Then building that into a company where there’s 13,000, 14,000 people. For anybody who started something from scratch, like you said, even for your venture capital firm, just getting the first fund is the hard, hard part. And then building into a robust business. You’re like, that’s hard too. 

Sarbvir Singh  

The point I just want to make on that was that I think the biggest achievement, right? I mean, I’m sure there are many, but the biggest achievement, I think was to stay true to this consumer focused agenda. Yeah, we will do what is good for the consumer. Because it is everything you know, especially when you’re starting out new to kind of do whatever it takes right to get there. Right. I mean, this is your first sort of thing is let me do what is right by myself. So so I think to that extent, the fact that and again, I would credit Yashish and the team, I think there is a team strong team of people who are there and I think they were able to stay with this agenda. And of course, now the agenda is paying off well, and you know, it all looks very golden. But to your point, it would have been very hard in the beginning. And I know, it was very hard because I was I, you know, I was in touch with him over the years. And I know there were some very tough years.

Michael Waitze  

I think the thing that impresses me the most, besides the robustness of the business is the building of a company culture that sustained and tell them you get there, I think this is where you talked about worms and all, when you get to a company, you can really feel the culture. And it’s maintained that consumer focus, because there’s so many temptations over time to just do the thing that’s expedient, as opposed to doing the thing that fits into the long term vision. Okay, so I want to talk more about these products, right? You mentioned in term plans and the change in products, you want to talk about, like, the innovation actually started back in 2009. With these term plans, you want to talk about that a little bit? And then we can move into digital as well.

Sarbvir Singh  

Sure. So Michael, as I said, at that time, the prevalent and this is across the industry, not just at PolicyBazaar, but across the industry, the focus was on, you know, what would we call traditional insurance plans, which are a mix of insurance and investment. And I think there was a good logic for that also, because at that time, you know, in the country was growing, you know, still relatively low per capita income and stuff like that. So things are still it was the habit was more important than necessarily the instrument. So I think there was a reason for that, and it was logical, but if you see what happens is after that, when, you know, when private enterprise was becoming a much bigger portion of the economy, and you know, things were moving in that direction. Now, the first thing that happened with private enterprise is that the safety nets completely go out of the window, right, because insurance etc, is not a part of private enterprise. And so the need for having those products which are more consumer friendly, where you could pay a small amount of money and be protected for much larger, you know, sum was a very important need. Now, what was the challenge, the challenge was that people were not used to a product where you would give them money and get nothing in return. Because this case, right, the best case is that you pay all this money, nothing happens to you, you are, you know, safe, and you get nothing back. So, so to explain this concept that you are going to pay something and not get anything back. And by the way, this is going to happen on something called the internet. And you will now come in, you know, give you a number and somebody will call you and all that stuff. I think so that was a big change. And and in a way you were standing against the industry, because the industry is we was let’s focus on what we’re selling, and what’s wrong with that. So so I think that that was a big step and a big decision. And I think PolicyBazaar, if you see has played a very strong role in popularizing term insurance in India. So this, we can say, with a lot of pride that I think we’ve spent over $200 million over the last 10 years in popularizing this. And after $200 million, Michael, the important and impressive thing in my mind is that only, I would say 25 or 30% of that money is investors money which has been invested. About 70 80% of that money is owned by PolicyBazaar and was reinvested in the business. So it is not a classic situation of taking money from some investor and generally spending it. It’s an investment that the business itself was able to make. So I think that is a very big thing. And even today, if you see Michael, we account for anywhere in the order of one in every four, you know, term policy sold in India. So that means across India, not online or offline, I’m seeing total term policies sold in the year one in four roughly, you know, are sourced from our platform. And I think the, you know, we play a very, I would say important part in the market in terms of product design, we work with insurance companies to explain what you know, what do consumers want. So if you think about it, we have become the voice of the consumer in the in the industry, this is what consumers want. These are the kind of need gaps, this is the process they want, you know, they are not comfortable in going to a hospital. So maybe we should do something at home. So you know, that is the seat that we have at the table, which is the voice of the consumer.

Michael Waitze  

Yeah. And you made a really good point earlier, right. So you said that the product dissemination was important to our product development was important, but also digital. Interestingly, when PolicyBazaar started this sort of digital marketing and digital distribution was not a thing. It was an analog company when it started. And it’s unique. I think that a company can make such a great transition from being an analog company into a digital company in a way that externally internally, I don’t know. But excellent, it looks kind of seamless, right? And you want to talk about that transition a little bit from a historic perspective, but also today, like, what are some of the differentiated digital offerings that are there?

Sarbvir Singh  

Sure. Let me take that in two parts. Like you said, one is the history right? So when you look at the history, the first few years of PolicyBazaar actually we’re almost like the Lead Generation company where, you know, we were just, you know, getting in traffic on the web, and we were then giving it to insurance companies to close the sale. Right. And through a mixture, I would say, of regulation and insight, right, that this is not a sustainable model, because, you know, for various reasons. And, and I think PolicyBazaar then went into the business of saying that we are responsible for the customers, so we should close the sale also. And that’s, that’s how we kind of, you know, morphed into the model that we are in today, where we have a strong digital, you know, frontend. And we also have the sort of agents and tele-calling, etc, where we are able to make sure that we explain the products and we help the person buy the product also. So I think that was a very key learning that is, insurance is a complex product. And it may not be possible for somebody to just bite on their own, and you need to assist them. And I think that’s how the model historically came into, you know, came into force.

Michael Waitze  

Yeah, before you talk about tech, I just want to jump in for a second. I’ve said often that, I think, and you’ll see the equivalency here that a lot of the real estate portals that just do lead gen into whether it’s apartment sales, or condo sales, whatever run into a problem, because they’re not involved in the transaction. And clearly, the policybazaar team figured this out, we can lead-gen until we die. But until we’re involved in the transaction, that we’re not intrinsic, and it’s not important enough for people to deal with us. And lead-gen can be barriers to entry and lead-gen low. But the barriers to trend, the barriers to entry in the transaction part of the business are very high.

Sarbvir Singh  

Absolutely. And the fundamental thing Michael like you say is that it’s a very hard road to go down. Yeah. So we have become, you know, we have a lot of people, we are experts at it. And you know, there is a lot of, you know, obviously we are building on top of what we have. But to start this model is not easy, because in the beginning, all you will see is you will find that the costs are will overwhelm, you know, the money that you can make sure and so it requires a deep sense of conviction to say that, yes, I will continue with this model, because I know that if I get to the other side, there is a positive business model that exists. Right. So I think that conviction, obviously, and I and I think Yashish deserves a lot of credit for that isn’t that his conviction was able to transform PolicyBazaar. And, and those years, I mean, again, having only seen it from the outside At that time, I can assure you, I think they were hard years. And it was difficult to you know, cross that chasm, or whatever you could call it.

Michael Waitze  

Yeah, I mean, look, those transitions are very, very difficult, right? Because you have to convince your existing staff, your existing team, and we look, we can go to Netflix, Netflix as another example of this, you have these little kiosks, you send out these red envelopes, you send these to people, and you wait for bandwidth to catch up to your other idea, which is we just want to stream everything. But while you’re doing that, you may cannibalize that existing sort of analog distribution business. And you have to make a commitment and say, and if you watch what Reed Hastings did, kind of a similar experience. I don’t know what you guys did internally. But what he basically said was to run a different business, we need a different management team. Yeah, right. So it’s very tricky to do that transition and still survive, because while you’re doing it, that new business, like you said, could be money losing for year one, year two, year three, but you’ve got to commit to it. Yeah, otherwise, you’re dead.

Sarbvir Singh  

Absolutely. Yeah. No, absolutely. So so I think that was the history part of it. And if you see where we are today, right, so we’ve obviously come a long way. And I just want to say that the difference is like what we are in I’m two, three different areas. So one big area is that we were able to demonstrate that the digital consumer is a better consumer, than the offline consumer. And what I mean by that is that this is a person who’s interested to know about insurance. So insurance, as you know, is typically a push product where somebody comes to somebody and says, you should buy insurance, right? Very few people go up to an agent and say, give me insurance. Whereas in PolicyBazaar, it is absolutely the reverse 100% of the people come to us and say I want to know more about insurance, right? 

Michael Waitze  

By definition, right? I mean, otherwise, I wouldn’t be there.

Sarbvir Singh  

Exactly. So now what that change was, and I think the industry was also surprised by that, that the quality of business that we generate. So whether you look at the mortality on our life side, or whether you look at the loss ratios, in our motor business, or in our health business, you will find that they’re significantly better than the industry. And when you sort of unpack that, and you say, why is that happening? There are clearly two or three reasons one is the quality of the customer because typically in the beginning on in on the web in India, only the slightly higher income better educated people were there, right and they were interested in insurance. Second is that when a person comes in, say something himself or herself, they tend to be honest. Right? They find it harder to lie and say that no, I don’t have any disease or I have no, you know, I’m fit. Whereas if there is another intermediary between them and the final, you know, declaration, it’s easier to say, okay, fine, you write whatever you feel like.

Michael Waitze  

Because they’re not aligned, right, their interests aren’t aligned.

Sarbvir Singh  

Exactly. So. So I think that took in the beginning, these two points lead to our becoming a lower, a more efficient channel. Then the third thing which has kicked in Michael, over the last few years, is that we have become better and better at data analysis. So now we have this humongous, you know, 13 years of data of people who have come to our site, some people have bought, some people have not bought. But now if you look at these people, we now have a huge amount of ability to say, almost, when we speak to you, when we see a behavior on the web, we have an ability to say, Okay, this is what Michael is like, this is what he’s likely to do. This is what his claim ratio is likely to be. So that is, I think, and it’s a it’s this is, the third part is the transition that we are going, this is still a driver for us, and will take us many years to get better at it. But I think the fact that in an industry where many times the manufacturer or the insurance company doesn’t know much about the final end consumer, right, then only about the channel, they know that the agent has brought in the business or the bank has got them the business, they don’t always have a direct relationship with the consumer. And we are providing the direct relationship. And we have this knowledge and this data. And we have a whole team which is focused on making sense of this data. So I think that these three things when you combine together, that’s one very powerful, you know, driver for PolicyBazaar, which is we have better business, a better book of business than any other channel, you know, in the country, right?

Michael Waitze  

I mean, if you I read a book, this was a while ago, and I can never remember whether it’s called into the Googleplex or the Googleplex, or into the Plex, I can’t remember but one of the contentions of the book was that they just the sheer amount of data that Google had collected up until that time, and I think this was like 10 years ago, just gave him such a lead against anybody else who wanted to be sort of in the search business, or in the online ad business, because of the things that they could understand that depth. That new competition couldn’t understand that I’m curious if you see that 13 years of data that PolicyBazaar has accumulated as a way to create sort of personalized products. But like you said, you have all this information, is there a way you can then segment that data, and then say, I know with a high degree of confidence that if we go to an insurance company, or reinsurance company, and create a brand new product that no one has considered prior, that we can sell this because of the things that I know about my customer base through the data that they’ve given me that fair?

Sarbvir Singh  

Absolutely. So I’ll just give you two or three examples so that this becomes a more real conversation. So if you look at our motor business, we work with over 10 leading Indian insurance companies, because the regulations in India Michael, don’t allow us to price the product for, you know, the regulation. So what we do is that we have built a model and which we have shared with the insurance companies, where we are able to get a sense of what is the right price for this person based on their, you know, behavior. And the behavior is of two or three kinds one is their digital footprint, what they do on PolicyBazaar? How many, you know, what is the behavior in terms of how many days before the renewal? Have they come of their policy? What time of the day? Are they looking at the policy? What other products have they bought from PolicyBazaar? Now, the that becomes another very powerful, you know, signal that if a person has bought health insurance and term insurance, other investment products, we have a sense of that person? And how many years has he been with us? Right? How many years has he renewed his policy? What was the acclaimed experience in the years that they renewed the policy. So when you put these two things together, we are able to give a very good price. And what is interesting is that in 70%, or 80% of the time, we give a better price, or our signals suggest a better price than what the insurance company would have liked to do. And in 20, or 30% of the cases, we actually suggest a higher price. When you say that based on this person, and this car, this model and his or her behavior, you are underpricing the risk, right, and this person should actually be offered higher. Now it is finally the insurance company’s decision as to what they wish to do with this information. But what I’m just trying to say is that we have used the data to build this very, I would say comprehensive model. And obviously, each year this model gets better. See the good news about a lot of the you know, modern AI and data science techniques is that as they get more information, they get better. So it’s not like, you know, whatever work last year is the only thing that you have to do next. So that’s just one example from the motor business. And I’ll quickly slip in one example from my health business. So one of the challenges Michael in India is insurance penetration, which is the number of people out of 100 who have insurance But then there’s another challenge, which is of the people who have insurance, they tend to be underinsured. So they tend to buy insurance, which is too small for their needs. And this is something that we had noticed in health insurance that people were buying policies, which were not keeping up with the cost of modern health care, right. And like, and you know, India is a complex country. So in some parts of India, you know, healthcare is really expensive. And obviously, in some parts, it’s not. So what we realized was that coupled with the fact that we had lower loss ratios than other channels, and the fact that, you know, people needed higher, some are short. So we said, why don’t you offer to a chosen set of our customers a higher sum insured policy? So if you were giving everybody else x, you give our guys 20x? And you charge them maybe 20% more? Right, then that now that seems like a fabulous bargain, right? That you’re paying 20% more, but during 20 times the cover? So the question becomes, how is that even possible, right? And we were able to show them the data that we have the ability to segment the audience, and you only offer it to those people where it makes sense. And I think finally, obviously, it took a while to convince insurers. And, of course, today, if you see the high sum insured, so we call it the high sum insured category of health insurance is about 1/3 of our business. And I think in the entire market, and of course, after COVID, I think nobody needs to explain, right? Why you need higher, higher amounts of cover. But I think a lot of the market moved in that direction, because we were able to create this very attractive bundle, which have, you know, some insurance and cost. So I think these are just two examples where we are using the data and really creating, you know, really good offerings for our customers.

Michael Waitze  

So I want to ask about, not just the speed, but the change in speed of the implementation of technology, right, just the velocity of change. And in 2008, you know, PolicyBazaar was new. And the more technology changes, the more powerful compute becomes, the cheaper that storage becomes. And the sort of ubiquity of bandwidth means that there are plenty of other companies popping up, you can call them neo insurance, you can call them whatever they want, how do you either participate in that, protect against that? Or maybe morph, again, into something different? How do you keep track of what’s going on in the market around you?

Sarbvir Singh  

Absolutely. That’s obviously a great question, Michael. And so if you look at where we are today, right, having created a position for ourselves where we are, if you look at the protection business, right, we are one of the key distributors, or key partners, I would say I would use the word partner and distributor for insurance companies, right, this is their agenda also to drive protection, and you know, we are we are also doing the same thing. So I think we have, we have a now we have a seat at the table, I would say, you know, we are not, we are we are still a startup, and we are a small company, etc, etc. But we have a seat at the table, we are no longer, you know, just a, I would say a young company in that sense. Now, with as they say, with great power comes great responsibility, or vice versa. So I think now, you know, what our responsibility is to drive this, this agenda forward. And what I mean by that is that if you do a survey of the top insurance brands in India, right, so what we’ll find is that and just independent, you will find that the bank brands come out ahead, obviously, they are the most well known, because people are aware of the banking franchise of those companies. But then PolicyBazaar is the next brand that is mentioned. Right? So today, the customer is looking to us not just as a source of information, or assistance in sales or buying a policy, they are looking at us to solve their insurance problems or their insurance needs. And what that means is that they say you tell us what is the right policy, what is the you know, where is the right place to be at, helped me make that choice, and after that look after me. So if I need to make a claim, make sure that I get the claim, you know, make sure that the process is easy to follow. Make sure that if I have to change my address on my policy, it will be done instantaneously. Right? Or if I want to find out which hospital should I go to? You’ll tell me right where I go to. Now, that is a very, it’s both a challenge and a problem, right? Because the problem is that we are now responsible for things that we don’t control, right? And today the claim is not in our hands. But we have taken that as a challenge instead, and said that how can we make ourselfs more and more of a platform, right for our customers. And if you think about it, that is the way the world is going right? The world is now moving towards ecosystems. So somebody like an Amazon or you know PayTM or whoever they are thinking of themselves not as solving one small problem but as solving entire set of issues. And that’s exactly you know, we are headed.

Michael Waitze  

PayTM is actually a really good example of this. Right, it’s just another payments company. It’s the same in India that it is in Indonesia. And the same as it is in Singapore, just different company names, but a similar experience at scale. And that is their thinking. And again, not just PayTM, right. But that if we have all these transactions going through our pipelines if we are the system of choice for payments, yeah, should we not also be the system of choice for other things that involve money and products? And that includes insurance and even investments? And even banks, even being a banking mechanism? How do you see that as sort of like an emerging challenge or emerging partnership opportunity as well?

Sarbvir Singh  

Oh, I think, Michael, that for us, like I said, we to some extent, I think we control our own destiny. And I don’t say that lightly, in the sense that we we have a certain market share and a certain market position. And, of course, you know, there are others who will, like you said, we are looking at changing the way the game is played, right? I mean, instead of they don’t have to compete with us directly, they will work in their own ways, right. But I think the the point that we we have, and we understand that insurance is a very difficult category, Michael, it is not like lending, or it is not like payments, or something else where you can just attach yourself to something else. Right? This is a really difficult business. You have to go into the detail of everything. And one of the challenges, let me be honest, for an Amazon or any multi, you know, like a platform player will be that they will have a huge negative, you know, risk that if they sell insurance, and the claim doesn’t go through, imagine everybody’s going to blame that platform. Right. So so that risk exists? And that is why I think the position that we have the years of effort that we are made in understanding how insurance companies work in understanding their psyche. See, this is also not a business, Michael, where you can just come and burn money. Right? It is, as you know, it is very easy to lose your shirt in insurance. I mean, you can, you know, you’re gonna go under in like six months. But after there is there is a regulator, right.

Michael Waitze  

The regulatory environment, as well as something that most people just don’t understand, excuse me, for interrupting you, when they come into the insurance business. Like I said, a lot of these companies look at it and just think it’s just another financial transaction. But the regulations in every country in every region are just completely different. And if you don’t understand them at scale and the minutia? You have problems.

Sarbvir Singh  

No. And I you know, if you think about it, Michael, there’s another problem that or another issue, which is very important, you know, this is about customer trust, you are taking somebody’s money and making a promise that I will help you in your time of need, right? So it cannot be done, you cannot just turn back and say, okay, now I’ve decided to shut down this line of business or something like that, right? This, this is a business that you have to enter with utmost seriousness, and I think it takes time for the customer also to appreciate will not come to you that easily. Yeah, for sure. You can see you can sell these sachet type of products, you can sell some flight insurance, that on the other which you know, which are really no customer value, they’re just distribution products, right, which gives the distributor some money. But those products, if you leave them aside, I think serious insurance products like the kinds we believe in, right in which we believe is the long term opportunity in a country like India, you have to be very, very thorough and detailed about it. And I do not believe that it is possible, so easy for people. But having said that, I think we totally respect not just the digital players, but I must tell you, Michael, we also a very carefully work, we respect the banks, because we know that they have the customers and they can, they are also learning that insurance is a you know, is a good source of income. And of course, they know that already. And then you know, we have other players who are coming into this business. So from our side, we understand there are people who value will come at it. But I think our main focus is that if we can continue to add value to the consumer and to the insurer. See, that’s the other thing that you have to understand that PolicyBazaar is a three legged stool, right? So we are there, the insurer is there and the consumer is there, it’s our job to make sure both are happy, right. Because you know, you can always trade off one for the other. And that is a short term thing to do. So, which is why you will find us talking a lot about loss ratios. We will talk about mortality experience, we will, you know, own up to these things. And this is very not very common for distribution companies. Because typically and you know, historically they’re always considered to be more focused on selling than anything else. But that is not our DNA at all. We always talk about shared business and you know, shared value so that it’s a symbiotic relationship right for both sides.

Michael Waitze  

Yeah. And I don’t want to sort of underestimate the importance of trust in any business to be fair, but particularly in the insurance business, and I want to quote my grandfather, and for some reason I’ve been doing that a lot today. He said to me once it takes a lifetime to build a reputation, and a moment to lose it, and you’ll never get it back, right? So this idea that you’ve positive that you have to build that trust over time. And be very careful about how you manage that trust, because it can be lost very quickly and regained almost impossibly, it’s not fair?

Sarbvir Singh  

Yes, absolutely. And like I said, this is a trust business, because you’re asking somebody to pay in advance. So think about that. That’s really a very, you know, and it’s not easy. And, you know, it’s something that you really have to take very seriously, whether you’re digital or analog, I would say.

Michael Waitze  

I want to ask a little bit about the future, I don’t want to keep you so much longer, although, to be fair I am very much enjoying this conversation. A lot of your incumbent insurance companies, and not just in India, but in the world are morphing as well into sort of a health and wellness service company. Where there and I think this gets back to one of the things you were talking about before where you have to move into places where you may not be able to control things, but your clients still expect you to have some information on this. Do you see a move into that in the digital space as well, for a company like PolicyBazaar?

Sarbvir Singh  

Absolutely, Michael, we are looking at ourselves increasingly as being part of ecosystems. So we are part of the health ecosystem, where right now our main product is health insurance, right. Like you said, we will continue to think of other ways of that in India, health insurance is only hospitalization, we are focusing on the outside the hospital, the OP, you know, segment as well, we are focusing on how we can bring younger customers into the mix, how we can be relevant for the more younger customers as well. So like to say it is not just about, you know, health insurance, but about thinking making a person feel and this is a journey, Michael, this is going to take us 5, 10, 15 years to get there. But we are on that journey where we are saying we are going to be relevant to your health, right, and it would be in the form of health reports. So like PolicyBazaar is part of this first initiative, which is a government initiative to, you know, build like a national digital health mission. So we are supporting that as well. And what we are basically trying to do is to say that we will help you with all your health requirements, you want to speak to a doctor, you know, consider it done. You want to buy some medicines, you have a prescription, we’ll have them delivered to your to your door. Now, these are all at this point ideas for us, because as you know, there are a lot of regulatory boxes, etc, that, you know, we have to cross. But I’m just sort of sharing with you a longer term vision where their health insurance health ecosystem, and will be part of that there will be a motor ecosystem. And as you know, in motor, you know, if you start thinking about it going forward, you don’t know which way to go. Right? Will the you know, let’s say we have a more electric car future, which I think everybody agrees upon how long it will take can always be debated. But in that future, what will be the role of insurance? Right,

Michael Waitze  

Autonomous vehicles? What happens?

Sarbvir Singh  

Right? Yeah, and is it? Is it just insurance? should we think about other services, like roadside assistance, you know, because from a customer’s perspective, you don’t want to deliver five different, you know, counterparties, and say, I’m buying this from you and that from you, right? You want to think of it as Okay, I trust you guys, and you won my trust. Now I just give you some money, and you do what you have to do. So I think we, and customers, you know, are becoming more demanding, Michael, I think the level of service etc, that they are getting in other places is going up. And, you know, I think we have to keep up with that. So I think we more and more are thinking of these large ecosystems. So even life insurance for us is going to be part of this, you know, health and wellness ecosystem, not just insurance only, right. And at a time, I’ll be very honest with you to take time, but things are changing mental health, which was not a subject being discussed, you know, let’s say, two years ago, or a year and a half ago, today is a very strong, you know, macro discussion. So I think we got to stay relevant. And I always say that we have to focus on the consumer, rather than focusing on products, because products will change, but people don’t change.

Michael Waitze  

So again, I know I said this already once, but I want to ask you one more thing, and then I’ll let you go. Because you kind of intimated this, but I want to ask you, do you see generational differences? In other words, as and I’m gonna put you in the same category, because we’re probably the same age. But if you look at when our children start to buy insurance, are they going to look at this whole ecosystem differently than we did? And maybe the generation in between us and our kids?

Sarbvir Singh  

Absolutely. Michael, I feel like why are children I think already the like when we talk to people who are in their 20s right versus the people who are in their 40s you can just see a big difference in expectation and approach to the problem. So the younger people take, see for them, this whole concept of digital is not even a discussion, they take everything, they expect that everything will be available, right? And the second thing that they expect is, which is more important, in my opinion, is that they expect a certain, when they buy something, they expect to be able to use it and to trust it. Right. And this may be true more of India than I think of outside India, but it was people of a certain generation, we all are still very happy if the product sort of does what it’s supposed to do. We are saying, okay, fine, I’m okay, that’s good enough. Current, you know, generation is expecting to be delighted, right? They are in the age when Amazon tells them that we will send you this product in three days and send it to them in 24 hours. Right. So their headspace is around, whatever you said that you have to do, that’s hygiene. Now delight me, right? It has our headspace is that, you know, if you do what you said, roughly speaking, we are okay. So this is a very important shift, and we have to stay on top of it and not be caught up in our own, you know, expectation of of standards. So, so I think that that is one very big change that is that is happening. And for India, it’s a big change. Because India, traditional levels of customer service were not high, right. I mean, we didn’t expect that we could return things or, you know, we could do those kinds of things. But now, the new generation has no has no knowledge that things like that also happened. So their expectations are totally different. And, and the insurance industry, I think has to has to move up. Because as you know, the insurance industry is not the, you know, at the vanguard of these changes, so I think we have to keep pace.

Michael Waitze  

Got it. Okay, look, I could I feel like I could keep you forever. I don’t want to do that. I’ve already said that was the last question I think two or three times, but that was the last thing I’m gonna ask you. I really want to thank you for your time today. Sarbvir Singh, the CEO of PolicyBazaar. Thank you so much for doing this today. 

If you would like to hear more from PolicyBazaar, listen to our episode with PolicyBazaar co-founder Yashish Dahiya here.

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