Why insurance industry must step out of the box

FOR decades, insurance in Sri Lanka—and indeed much of the region—has remained a predictable business. From the way policies are sold to how customers are serviced, very little has truly evolved. Yes, the language of marketing has changed, call centres are more responsive, and digital portals now replace the dusty filing cabinets of yesteryear. But in essence, the model is still rooted in the same premise: pay your premium, stay covered, and hope you never have to claim.

- By Jumar Preena

The uncomfortable truth is that most customers rarely see tangible value from their insurance investment—except when calamity strikes. Until then, their relationship with the company is one of silent obligation rather than active engagement. The industry, for all its promise, continues to sell "protection" but not "participation".

It is time the sector rethinks its purpose, its engagement model, and its social relevance.

A business frozen in tradition

Insurance, by its very nature, is a conservative business. It thrives on risk calculation, data integrity, actuarial prudence, and long-term guarantees. Those fundamentals must never change. Yet, this same adherence to caution has created a culture of inertia.

Most insurance providers still design products the same way they did a generation ago. A motor policy, a life policy, a medical cover, or a corporate plan—they differ only in packaging, not philosophy. The communications are predictable: “peace of mind”, “secure your family”, “protection for your loved ones”.

Even with digital transformation, most innovation has been inward focusing on automation, paperless systems, underwriting efficiency, and claims processing. These are vital improvements, but they do not excite or engage the end customer. In short, the processes have evolved, but the experience has not.

The customer's dilemma

Ask the average policyholder how often they think about their insurer. Chances are, they only do so when they renew their premium or file a claim. In other words, the relationship remains transactional, not emotional.

To the customer, the annual payment often feels like a tax rather than a value-based investment. For motor insurance especially, many view it as a legal necessity rather than a personal benefit. Life and medical insurance policies, while essential, remain intangible promises—valuable only in moments of crisis.