ICICI Lombard Gram Abhiraksha Yojana

Gram Abhiraksha Yojana aims to club various General

Insurance offerings in the Automobile, Health and Home
Insurance domain and create a curated offering for the rural
sector and provide a customized offering based on personal
needs. The product aims to offer a streamlined process and
medium to cater to the basic general insurance requirements
of the rural and semi urban Indian population, empowering
them to choose and customize their respective insurance
plans according to their needs in one go.

The product aims to help people from rural and semi urban
population acquire insurance cover for their varying needs in
automobile, health and home insurances via a single insurance
product offering. This will eliminate the need to purchase
different products for different situations. The design of the
product would be such that the buyer would have the option of
selecting one or more insurance policies at the same time and be
billed accordingly. This will save them the hassle of managing
different accounts and making separate payments for different
coverages.
This offering would give people the flexibility to choose their
insurance cover depending on their investment, income and risk
absorption capacity. Once a prospective insurance buyer chooses
and fixes their requirements, an ICICI Lombard agent would
then communicate the quote for a single premium for all the
three insurances which would then be proportionately allocated
to the respective insurance domains. Hence, in the backend,
ICICI Lombard would be curating a customized plan and
premium installments for the buyer as well as for the various
coverages involved.
This would greatly help customers understand the various kinds
of offerings, as well as the flexibility and ease of acquiring
insurance would incentivize people to buy more policies.
Hence a customer can enjoy the benefits of up to three different
policy coverages from a single insurance agent who would be
their point of contact.
The single biggest problem people face in rural and semi urban
areas is the lack of complete and trustworthy information about
the kinds of policies available in the market accompanied with
the hassle of understanding and deciding a suitable product for
each of their needs. It’s a time-consuming process that creates
more confusion than resolving. The main reason behind this is
their being mostly from the unorganized sector and not-so-tech-
friendly environment. A poor digital literacy among these
populations creates a huge hurdle for them due to lack of easy
access to information, which consequently leads to their
minimal participation and buying.
This offering will address these innate issues pertaining
specifically to rural and semi urban areas of the country and
save time, money and fatigue.
Enablers: The biggest asset that ICICI Lombard already
possesses is its rich experience in the Life insurance sector
where it has had its footprints for the last two decades. It has
successfully established its hold in the Indian rural market with a
penetration close to 15% in a highly competitive Insurance
market. Its relationships with its customer base can play a major
role in pushing this offering.
Also, it should look at getting into a need-based partnership with
India Post which has more than 1,40,000 post offices in rural
and semi urban areas, and can take advantage of its huge
employee base who have decade long relationships with rural
inhabitants.
The increased awareness of Internet and digitalization of several
processes should also help create cheaper and faster channels of
training and continuous feedback systems which would facilitate
transfer of correct and reliable information and quick wrapping
up of the process.
Competitive advantage: Of the total 63 insurance companies in
India, 24 are in life insurance business and 39 are non-life
insurers. The total market penetration of general insurance in
India is 3.69 % (premiums as % of GDP). At the moment, other
insurance providers like Bajaj Allianz and Bharti AXA are
focusing on revamping their insurance models for particular
sectors such as home insurance, farm output insurance etc but do
not have a streamlined process or interface to club their various
offerings to the public into a single product. Aditya Birla Health
Insurance Company targets specifically the health insurance
market.
ICICI Gram Abhiraksha Yojana will be a disruptive offering in
the General Insurance segment giving power and flexibility in
the hands of prospective customers. This would enable a
cumulative growth in all the sub general insurance domains.
The potential market for this offering is huge and would
encompass most rural and semi urban areas of the country. The
current rural population in India is about 67% of the total
population. As per latest UN data, population of India is about
1,368,737,513. This translates into a rural population of
approximately 91,70,54,133. Assuming a family of 6 on
average, we have close to 15,28,42,355 families. After an
extensive marketing if ICICI Lombard is able to sell to about
0.005% of population in its first phase sales, it would serve to
about 7,64,211 rural families across the country.
Although the focus should be to target semi urban population in
the first rollout on a pilot basis in states like - *Punjab
(34,68,838 rural families), Maharashtra (1,23,11,214 rural
families), Andhra Pradesh (1,12,72,340 rural families), Kerala
(34,94,227 rural families) and Tamil Nadu (74,45,918 rural
families) where the awareness, digital friendliness among
people, and insurance penetration is higher as compared to other
states. These five states alone account for about 24.85% of rural
population in India. If sales convert about 0.01% in these states,
the company would affect 3,82,105 families.
* All populations as per 2011 census data. (Census 2011, n.d.)