Case Study
How EmbedSure Supports NBFCs with Embedded Insurance Solutions
Client: A Leading Non-Banking Financial Company (NBFC)
Industry: NBFC – Lending and Financial Services
Service Provider: EmbedSure – Embedded Insurance Solutions
process
Background
Non-Banking Financial Companies (NBFCs) are a vital part of the financial ecosystem, providing credit and loan services to individuals and businesses across India. However, NBFCs face significant risks due to borrower defaults, often caused by unforeseen life events such as job loss, illness, or accidents. To mitigate these risks and provide greater value to borrowers, NBFCs have been exploring ways to integrate protection mechanisms into their financial products.This case study outlines how EmbedSure's Embedded Insurance Solutions supported a leading NBFC by offering comprehensive insurance coverage that protected both the NBFC's loan portfolio and its customers from financial risks.
Challenges Faced by NBFCs
High Default Risk: Borrowers often face unexpected events like job loss, illness, or accidents, making it difficult to keep up with loan repayments. These defaults increase the Non-Performing Assets (NPA) ratio for NBFCs, impacting profitability.
Low Customer Retention: In a competitive lending environment, customers are drawn to lenders offering added value. NBFCs need innovative solutions to retain customers and build long-term loyalty.
Limited Financial Protection for Borrowers: Many borrowers do not have adequate financial protection in case of emergencies, making them vulnerable to default when they experience unexpected disruptions in income or health.
Operational Inefficiencies: Without a streamlined process for embedding insurance into loan offerings, managing insurance claims and integrating with financial products can be complex and time-consuming for NBFCs.
The Solution: EmbedSure’s Embedded Insurance for NBFCs
EmbedSure provided the NBFC with a tailored Embedded Insurance Solution, designed to offer insurance coverage bundled directly with its loan products. These solutions not only protected the NBFC from defaults but also empowered borrowers with financial protection, creating a win-win scenario.
Loan-Credit Life Insurance: Coverage for outstanding loan balances in the event of the borrower's death, ensuring the loan is paid off, and their family is not burdened with debt.
Loss of Job Insurance: Provides temporary financial assistance to cover EMI payments in the event of job loss due to layoffs, economic downturns, or company closures, reducing the risk of loan default.
EMI Protect: Ensures that EMI payments are covered during periods of hospitalization or illness, allowing borrowers to maintain their financial obligations without stressing about medical expenses.
Income Disability Insurance: Offers income protection for borrowers who suffer from an accident or illness that leads to temporary or permanent disability, ensuring they can meet loan obligations.
Impementation
Seamless Integration: EmbedSure’s platform was integrated into the NBFC’s existing loan management system through APIs, allowing for the automatic bundling of insurance products at the point of loan approval.
Digital Claims Process: The entire insurance claim process was digitized, enabling borrowers to report claims, track their progress, and receive settlements through a simple online interface. This streamlined process minimized the administrative burden on the NBFC.
Customizable Insurance Offerings: EmbedSure tailored insurance products based on the loan type, loan amount, and customer segment. For example, higher-value loans were paired with more extensive life and job loss coverage, while consumer durable loans were bundled with extended warranty insurance.
Education and Awareness: EmbedSure worked with the NBFC to educate borrowers on the benefits of insurance, helping them understand how these products could safeguard their financial well-being in case of emergencies.
Results
Reduced Default Risk: By embedding insurance products directly into loan offerings, the NBFC significantly reduced its risk of defaults. Borrowers facing job loss, critical illness, or accidents were able to claim insurance benefits, keeping up with their EMI payments. The NBFC saw a 20% decrease in loan defaults within the first year of implementing the solution.
Increased Loan Sales and Customer Retention: The embedded insurance offerings helped the NBFC differentiate its products in a competitive market, making loans more attractive to borrowers. As a result, the NBFC experienced a 15% increase in loan uptake and a 25% improvement in customer retention as borrowers valued the added security.
Operational Efficiency: EmbedSure’s digital integration reduced the administrative workload associated with managing insurance policies and claims. The streamlined process saved the NBFC significant time and resources, improving overall efficiency.
Enhanced Customer Confidence and Satisfaction: Borrowers appreciated the additional layer of financial protection provided by the insurance offerings. This increased customer satisfaction and built trust in the NBFC, as borrowers knew they were covered in case of unforeseen events.
Better Risk Management: The NBFC's overall risk management improved as insurance products mitigated potential losses due to defaults. This led to healthier loan books and more stable profitability.
Key Solutions for Gadgets and Appliances
Accidental Damage, Loss, and Theft (ADLD) Insurance
EmbedSure’s ADLD Insurance offers protection against the unexpected for valuable gadgets like smartphones, tablets, laptops, and home appliances. Whether it’s accidental damage, loss, or theft, ADLD insurance ensures that customers are covered for repair or replacement costs.
Coverage for accidental drops, water damage, and other unforeseen incidents.
Protection against theft or loss of gadgets.
Quick repair or replacement service for insured devices.
Flexibility to cover a wide range of devices, including smartphones, laptops, and home appliances.
Extended Warranty (EW)
With gadgets and appliances, repairs can become costly once the manufacturer's warranty expires. EmbedSure’s Extended Warranty (EW) extends the protection period, covering the repair or replacement of devices due to mechanical or electrical failures beyond the standard warranty period.
Coverage for repair or replacement due to mechanical or electrical breakdowns after the manufacturer’s warranty expires.
Flexible plans tailored to different gadget types and appliance categories.
Access to authorized service centers for high-quality repairs.
Hassle-free claims process with fast settlements.
Benefits
Key Benefits of EmbedSure’s Embedded Insurance for NBFCs
1. Risk Mitigation
EmbedSure’s insurance solutions significantly reduce the risk of loan defaults by providing borrowers with financial protection during emergencies
2. Customer Retention and Loyalty
Offering value-added services like embedded insurance improves customer loyalty and increases retention, creating long-term relationships.
3. Increased Loan Uptake
With the assurance of financial protection, borrowers are more likely to take loans, boosting loan sales for NBFCs.
4. Operational Streamlining:
EmbedSure’s digital platform simplifies the management of insurance policies, claims, and customer communication, improving overall efficiency.
Conclusion
Conclusion
By partnering with EmbedSure, the NBFC was able to offer a comprehensive financial solution that protected both its loan portfolio and its borrowers from unexpected events. The integration of embedded insurance not only reduced default risk but also enhanced customer satisfaction and loyalty, resulting in a more stable and profitable lending business.
Looking to protect your loan portfolio and offer more value to your customers?
Contact EmbedSure today to learn how our embedded insurance solutions can support your NBFC in managing risks and enhancing customer relationships.
Looking to protect your loan portfolio and offer more value to your customers?
Contact EmbedSure today to learn how our embedded insurance solutions can support your NBFC in managing risks and enhancing customer relationships.
Quality care
Viverra mauris in aliquam sem fringilla ut. Suscipit tellus mauris diam maecenas sed enim ut
Discount on Products
Pulvinar elementum integer enim neque volutpat ac. Scelerisque purus semper eget duis
Affordable care
Dignissim convallis aenean et tortor at. Gravida dictum fusce ut placerat orci nulla et egestas quis
Care anytime
Tortor pretium viverra suspendisse potenti nullam ac tortor vitae purus. Pellentesque id nibh tortor
Testimonials
Those who trust us
Getting the policy was quick and easy, and the staff was ready to answer all my questions. In the event of a claim, the company offered prompt support, and the claims process was smooth.
Emmy Elsner
Testimonials
Those who trust us
Getting the policy was quick and easy, and the staff was ready to answer all my questions. In the event of a claim, the company offered prompt support, and the claims process was smooth.
Loni Bowcher
Testimonials
Those who trust us
Getting the policy was quick and easy, and the staff was ready to answer all my questions. In the event of a claim, the company offered prompt support, and the claims process was smooth.
Erika Mateo
FAQ
Frequently asked questions
How do I file a claim?
Visit our online portal or contact our customer service to initiate the claims process. We’re here to guide you through every step.
What types of insurance do you offer?
We provide a range of insurance solutions, including home, auto, health, and more. Explore our offerings to find the coverage that suits your needs. Pulvinar pellentesque habitant morbi tristique.
How can I modify my policy?
To make changes to your policy, contact our customer service team. They will assist you in updating your coverage to align with your evolving needs.
What factors influence insurance premiums?
Several factors impact insurance premiums, such as your coverage amount, deductible, and personal circumstances. Our team can help you understand and manage these factors.
Questions?
We’re here to help
