While artificial intelligence offers powerful tools for underwriting and operational efficiency, it cannot single-handedly solve India’s systemic protection gap. Speaking at the Global Fintech Fest, NITI Aayog’s Sanjeet Singh emphasized that addressing India’s persistent “missing middle”—the vast demographic caught between government-subsidized safety nets and high-end commercial insurance—demands a concerted, collaborative push from the broader financial sector.
The Reality of the “Missing Middle”
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The Coverage Deficit: A substantial portion of India’s population remains unhedged against health and economic shocks because they earn too much to qualify for state-backed safety nets like PM-JAY, yet find commercial insurance products too expensive or rigid.
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Beyond Algorithmic Reach: While insurers increasingly leverage AI for fraud detection, automated claims processing, and personalized risk profiling, technology alone cannot create purchasing power or generate trust in underserved segments.
The Call for Industry Collaboration
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Innovative Product Architecture: NITI Aayog has urged insurance and fintech leaders to design modular, bite-sized, and affordable products tailored to informal and gig economy workers.
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Distribution and Trust: Reaching remote and low-income tiers requires expanding physical and digital distribution channels, reducing friction in onboarding, and building grassroots financial literacy to ensure long-term policy retention.
