MUMBAI: New-age non-life company Digit Insurance is using data mining and analytics to develop low-cost micro products — like a cover for flight delays of 60-75 minutes — for a double-digit premium. The idea behind the flight delay policy is that passengers usually end up spending more money in the airport if they have to wait an additional hour. They will either buy a book or spend time in a coffee shop. The insurance cover compensates them by paying a claim amount of Rs 1,000.
What has enabled such a cover is technology. Given availability of flight data, the insurer can alert the buyer to claim an entitlement as soon as the flight is delayed. All the customer has to do is click on a link and upload the image of his boarding pass to receive the claim amount. According to Digit Insurance chairman Kamesh Goyal, the flight delay policy is bundled into the travel cover currently, but the company will be offering this as a stand-alone product that can be bought directly or through distributors.
The insurer’s analytics of flights has thrown up some interesting findings. The data shows that early morning flights on Tuesdays are the best option to avoid delays while those flying after 10pm on Friday are the most likely to experience a flight delay. Also, if you are flying out of Ludhiana, there is a one-in-five chance of your flight being delayed.
An analysis of August flights has shown that despite monsoon, less than one out of every thousand flights was delayed for more than six hours — except on Wednesdays, which for some reason saw around two flight delays in every thousand. “We have not done a deeper research into what is triggering the delays, but this is what the numbers show,” said Goyal. According to Goyal, the company has segmented the pricing based on month, airline and time of flight. “Given that each airplane has a number, it is possible to track each aircraft and predict the delay and price the cover accordingly,” he said.