InsurTech for Bharat: Reimagining Insurance for the Underserved

The Missing Middle of Insurance in India

India’s insurance penetration remains critically low at 4.2% (life: 3.2%, non-life: 1.0%), compared to the global average of 7% (IRDAI, 2023). More than 600 million Indians are either uninsured or underinsured, disproportionately affecting informal workers in both rural and urban settings.

Despite advancements in digital infrastructure, insurance hasn’t reached “Bharat”-the India beyond the metros. This “missing middle” isn’t just an underserved segment; it’s the backbone of our economy. Traditional insurance models-with high premiums, limited reach, and complex processes-are fundamentally misaligned with their needs.

At MicroNsure, we believe this is where InsurTech must lead—not merely digitizing insurance, but reengineering it for inclusion, empathy, and trust.

Tech + Empathy: A Powerful InsurTech Formula

InsurTech is often portrayed through AI dashboards or blockchain integrations. But real transformation happens when technology meets empathy. MicroNsure’s model is anchored in four core pillars:

1. Affordability at Scale

For the underserved, even ₹10/day is significant. We apply usage-based pricing, group underwriting, and behaviour-linked premiums.

📊 Example: ₹1 lakh personal accidental cover for just ₹30/year - less than ₹0.08/day.

2. Last-Mile Digital Enablement

While India boasts over 700 million smartphone users, digital usage declines sharply in non-metro areas. Our mobile-first platform includes vernacular voice support, multilingual chatbots, and assisted onboarding via SHGs, BC networks, and field partners.

3. Smart Claims with Zero Paperwork

Nearly 30% of general insurance claims face delays or disputes (IRDAI). Our AI-powered claims engine processes most claims in under 48 hours, enabling intimation and tracking via WhatsApp or IVR in local languages.

4. Data for Financial Inclusion

With 10 million+ active policies, MicroNsure is building one of India’s largest grassroots-level insurance data ecosystems. This empowers better product design, pricing models, fraud prevention, and risk prediction.

Case Study: I2U2 – Insurance for Migrant Workers

India is home to over 140 million migrant workers, most of whom lack even basic health or accident insurance. Our “I2U2: Insurance for the Urban Underprivileged” initiative is designed to bridge this critical gap.

In collaboration with cooperative societies and gig platforms, we co-created a plan offering:

• Personal accident + hospitalization coverage

• Sachet model premiums for affordability

• Multilingual onboarding and claims servicing via digital platforms

• Integrated grievance redressal for accountability
  

Covering informal workers isn’t just inclusion - it’s where real equality begins.

Innovation That Works Where It's Needed Most

While global InsurTech firms chase embedded APIs and blockchain-led innovation, India’s opportunity lies in solving for the underserved with empathy, context, and scale.

At MicroNsure, our focus is on Tier 2–6 towns, migrants, informal workers, and young women - segments often overlooked by mainstream insurers. We don’t just digitize legacy products. We co-create new protection models, including:

• Vidya Rakshana Kavach: School-life protection for children from low-income families

• My Pink Cover: Comprehensive insurance for menstrual and reproductive health challenges

These products don’t just close protection gaps - they restore dignity and hope.

A Call to Action

We urge the InsurTech community to look beyond premium-paying urban customers. The next 500 million policyholders are not just a market - they’re a mission.

Let’s build insurance products with them, not just for them.

Let’s make insurance a right, not a privilege.

Author: Kamalakar Sai Palavalasa, Founder & Group CEO, MicroNsure

Disclaimer: The opinions expressed within this article are the personal opinions of the author. The facts and opinions appearing in the article do not reflect the views of IIA and IIA does not assume any responsibility or liability for the same