Online financial services provider 5Paisa Capital is looking to enter the insurance advisory space. In an interaction with Moneycontrol, Prakarsh Gadgani, CEO, 5paisa.com said that they will apply to the Insurance Regulatory and Development Authority of India (IRDAI) that will enable them to offer advisory services on the insurance front.
“Insurance is still a push product in the country. Since we already have an existing database of customers, we want to utilise that to cross-sell products in the life, health and motor insurance space to them and also advise them on the appropriate product that they should buy based on their life-stage and future requirement,” he added.
Insurance brokers are allowed to provide advice to customers based on their risk appetite and by doing a need analysis. Unlike agents, since brokers are engaged with multiple insurance companies, they are able to offer a varied product choice dependent on the current and future requirements of the policyholder and their families.
Part of the IIFL Group, 5paisa offers an array of services including online discount brokerage for trading in stocks, as well as financial products like mutual funds, personal loan and insurance. In the next few weeks, the open API platform of 5paisa will also be available, added Gadgani.
The company was demerged from the IIFL Holdings in 2016 and was listed on the exchanges in November 2017. It is the first online trading firm to list on the stock exchanges in the country.
In the insurance space, the company offers term products, health insurance as well as motor insurance. However, Gadgani said that health insurance is one of the fastest growing segments.
Gadgani said that they do not wish to expand into other product categories at this point and would want to deepen the penetration of these products to all the markets where other products are available. The company is a 100 percent online entity and do not have any feet-on-street to market their products.
5paisa also has a robo-advisory platform which is driven by algorithms. This is currently offered for mutual funds as well as the insurance products including recommendations based on the customer profile. Going forward, Gadgani said that the aim is to expand this to all financial products abnd make it a wealth manager for retail investors.