There was a time when insurance agents used to go from home to home, selling policies, majorly around health. Many agents prioritize selling policies that offer them higher commissions rather than recommending products that genuinely meet the customer’s needs.
This often leads to misaligned interests, lack of transparency, and mistrust among customers. As digitization grew, so did the insurance industry with players like ACKO. ACKO is a digital-first insurance company that provides quick, affordable, and personalized insurance solutions.
By eliminating middlemen and going fully online, ACKO simplifies the process, reduces costs, and makes claims hassle-free for its customers. Acko is the brainchild of Varun Dua, who founded the company in 2016 with the vision of revolutionizing the insurance industry.
Before Acko, Varun had already made a mark in the insurance sector when he was the co-founder and CEO of Coverfox, an online insurance aggregator. Acko is currently an insurtech unicorn with a valuation of $1.4 billion.
Acko has raised over $458 million from investors like Amazon, Catamaran Ventures, and Narayana Murthy. Unlike traditional insurers, Acko operates as a direct-to-consumer platform, eliminating the middleman and offering streamlined, paperless, and affordable insurance solutions. In FY24, it made a revenue of Rs. 2,106 Cr by selling insurance!
Traditional Insurance Industry
The insurance market is massive, with India projected to reach $222 billion by 2026, thanks to rising awareness and economic growth. However, the industry has long been dominated by traditional players like LIC and ICICI Lombard, who rely heavily on offline models.
But, as more people embrace online platforms, digital insurance is gaining traction. Consumers now demand convenience, transparency, and quick claim settlements. However, insurance in India is still seen as complex and unreliable by many consumers. Despite being a large market, only about 3.8% of India’s population has overall insurance coverage, while the number is 6.5% globally.
Also, customers often prioritize cost over comprehensive coverage, making it hard to sell value-added policies. For decades, the insurance sector has leaned on tried-and-true methods to attract customers:
- Agent Networks:Agents have been the face of insurance, building personal relationships to sell policies.However, this model is resource-heavy and lacks scalability.
- Mass Media Campaigns:Companies rely on TV, radio, and print ads to establish trust and build brand awareness.Messaging often focuses on reliability, family security, and legacy.
- Limited Digital Channels:While online presence is growing, traditional insurers have been slow to fully adopt digital marketing and sales.
Why Acko Stands Out
Building Trust Through Collaborations:
Trust is a big deal in the insurance world, and Acko has borrowed a classic tactic from traditional players: forming strategic partnerships. Collaborating with companies like Amazon and Ola has given Acko credibility by associating with brands consumers already trust.
These collaborations also simplify the insurance-buying process, offering policies directly at the checkout page for products like electronics or travel tickets. They also help Acko tap into massive customer bases without traditional marketing overhead.
Offering Discounts and Customization:
Just like traditional insurers who bundle discounts or offer loyalty benefits, Acko uses competitive pricing to attract customers. For instance, customized micro-insurance products, like screen damage protection for smartphones, cater to specific customer needs while remaining affordable.
Discounts and convenience through partners like Ola mirror the industry’s approach to building loyalty and retaining customers. At the same time, Acko has reimagined how insurance is marketed, taking bold steps to address modern consumer expectations. Here’s how it sets itself apart:
Digital-First Approach
Acko operates as a direct-to-customer (D2C) platform, allowing it to save costs. Unlike traditional insurers, this model is inherently scalable, allowing Acko to expand rapidly without the overhead of managing offline agents. But people already trust offline agents. How can Acko gain their trust?
To tackle the most common misconceptions about an online insurance aggregator, the brand roped in Madhavan to create a series called “What’s the Catch?”
This helps to clear any doubts about going for an online option rather than traditional ones.
| “Insurance is the category where people get confused with the terminology and are lost for words. This is not something you want to wake up in the morning and read about. We wanted an authentic voice to come on board and ask us genuine questions that consumers have in their minds.” |
Pricing:
Acko’s pricing strategy is both competitive and transparent, reflecting its commitment to affordability. By eliminating intermediaries like agents and brokers, the company significantly reduces operational costs. These savings are passed on to the customer, ensuring premiums remain low.
Transparency is another key element. Traditional insurers often overwhelm customers with hidden fees and complex terms, but Acko has simplified the process. By clearly outlining costs and coverage details, it ensures that customers understand exactly what they’re paying for. According to a January 2024 report, within 5 years, Acko has managed to distribute 78 million+ unique policies! (Source)
User Experience Focus
Acko knows that today’s customers value simplicity and speed. So, they have centered around seamless user experience:
- Purchase Journey:Buying a policy with Acko is as easy as shopping online. No paperwork, no long waits – just a few clicks on their app or website.
- Fast Claims Processing:Acko markets its fast claims as a competitive edge, with many claims being processed within hours. This addresses one of the biggest pain points customers face with traditional insurers: endless delays.
- Mobile-First Design:Recognizing that most of its target audience prefers smartphones, Acko has optimized its entire process for mobile users.
So, it makes the platform focused on consumer needs rather than agent commissions.
Humorous + Impactful Ad Films:
Acko’s digital-first approach ensures precision targeting, engaging consumers based on their browsing habits and preferences. They have also tapped into cricket and Bollywood in their marketing campaigns, majorly with 2 types of ad films. Firstly, they created a series of ads with Sara Ali Khan and Saif Ali Khan – the popular father-daughter duo, for a series of ads around car insurance:
Secondly, also created ads with the iconic duo of Munna Bhai and Circuit to promote health insurance:
In simple language and nostalgic format, the ad film highlights the downsides of traditional health insurances, positioning Acko as the more transparent and direct option. Using Bollywood in the ad films have made the ads more memorable and lasting.
Apart from this, they also partnered with Delhi Capitals, tapping into the cricket fanbase in India.
Notice a common thread in Acko’s ad films? They use relatability and humor in all the campaigns.
This directly contrasts the traditional nature of insurance companies which often elicit a sense of boredom, confusion, and complicated paperwork. Their ads focus on solving everyday pain points, making insurance feel like less of a chore and more of a helpful service.
Not only this, they also create interesting impactful campaigns like this:
Collaborating with tailors for heart health is an initiative by Acko for better health among Indians.
In a Nutshell
Acko’s journey from a startup to a $1.4 billion insurtech unicorn is a masterclass in rethinking traditional industries. By adopting a digital-first approach, Acko has not only simplified the complex world of insurance but also made it more accessible and customer-friendly.
Its ability to address everyday pain points, like fast claims and clear pricing, positions Acko as a customer-centric disruptor in a traditionally opaque market.
Key Takeaways from Acko’s Marketing
- Use relatability and humor to simplify complex topics for better customer engagement.
- Leverage strategic partnerships with trusted brands to gain credibility and tap into established customer bases.
- Adopt a mobile-first design to cater to modern consumer preferences and enhance user experience.
- Focus on transparency and affordability in pricing to build long-term trust with customers.
- Reimagine traditional ad formats by using familiar, nostalgic elements to make campaigns memorable.
