MARKETING OF INSURANCE

GROUP MEMBERS

Krutang Doshi 508

Zanzan Doshi 509
Shraddha Gala 510
Khyati Gandhi 511

INTRODUCTION

DEFINITION
A contract (policy) in which an individual
or entity receives financial protection or
reimbursement against losses from an
insurance company. The company pools
clients' risks to make payments more
affordable for the insured.

WHAT IS INSURANCE?

Transfer of the risk of a loss.

Used to hedge against the risk of a
contingent, uncertain loss.
Insurer.
Insured.
Premium

CURRENT SCENARIO

Insurance penetration and density

India - 52nd in nonlife insurance penetration,

(lower than countries like Sri Lankaand
Malaysia.)
27 general insurance companies in India, yet
the general insurance penetration is 0.71%.
Insurance density for general insurance in
India is less than $9, while it is $53 in China.

IMPORTANCE OF MARKETING OF INSURANCE

Insurance penetration in the country is

well below its need and potential. Its
development is very important.
The insurance industry in India should
take an immediate action to increase
its reach in the country.
Thus, it needs to market the product.

INSURANCE MARKETING

Reach of insurance campaign

Insurance marketing refers to....

Insurance marketing focuses on...

Traditional marketin consisted of

4P's...

PRODUCT

what is a product???
Tangible product & Intangible
services
Insurance companies sell services
LIC & GIC
Other services
Innovative product strategy
Considering the strategies.

PRICE

Influencing target market

Premium rates
Three main factors under life
insurance
Other factors
Revised premium rates

PLACE

Component of marketing
Appropriate location of branches
Additional factors
Place of branch office
The insurance personnel needs
professionalism
Provide proper service to end user
Lack of professionalism

PROMOTION

Effective promotional measures

In India,rate of illiteracy is very
high
Both promotion strategies
Important role of agents
Proper promotional tool
Proper advertising & publicity
Participation in activities
Rural prospects

PEOPLE

Appropriate products...
Intermediaries are.....
Training staff & agents
HR should be developed
Providing incentives

PROCESS

Consumer friendly
Payment system
Installment schemes
Customer efficiency
Technology is cost effective

PHYSICAL DISTRIBUTION

Distribution is a key determinant

Nationalised insures
Very expensive & time consuming
Technology can't replace it
Financial companies & banks
The physical evidences include

CHANNELS FOR DISTRIBUTION

The

multiple channel have the insurance companies to tap on the

untapped potential and focus on specific market as well. The
available distribution channels in market are as follows:

Agent
Broker
Corporate

agent
E- marketing (Online)

AGENT
In

the distribution channel agent are in the front end

and the managers are in the back end this called the
two layered distribution channels.

Duties

of the agent

To search for prospective customer and understand their

insurance needs.
To meet the prospective customer explain and discuss with
them different products of insurance.
To suggest policy to the client and finalise the sales.

To attend to any requirements if any for the acceptance of those

proposal
To motivate the policy holder to pay the premium in time.
To render prompt and efficient services to the customers.
To discharge the function according to strict rule and regulation

without interfering with the prescribed laws.

Section 42 of the insurance act 1938 governs the licensing of
insurance agents of in India.

BROKERS
Broker are also recognised by regulation as
authorised by regulation as authorised of
insurance products.
1) A life insurance broker can be work under the
companies act 1956.
2) To advice on appropriate insurance covers and
terms.
3) To provide service relating to insurance and
risk management.
4) To assist in the negotiation of claims.

CORPORATE AGENT

Corporate agent are the new channels of distribution

developed in the post liberalisation era. IRDA
introduced this channel to increase insurance sector
of banks firms NGOs etc.
As per IRDA every corporate agent as per
IRDA(licensing of corporate agent ) regulation 2002
shallBe responsible for all acts of omission and
commission of its corporate insurance executive and
every specified person.
Ensure that no prospect is forced to buy an insurance
product.

Ensure that the corporate insurance executive and all specified

person are properly trained, skilled and knowledgeable in the
insurance product they market.

Give due publicity to the fact that the corporate agent does not
underwrite the risk or act as an insurer.

E-MARKETING

E-marketing refers to the use of internet &

digital capabilities to help sell your products
or services
Technology & web have a significant role to
play in the buying process
E-marketing is also called web marketing,
online marketing or internet marketing
Fast growing with one third of the financial
transaction taking place online
E-marketing is creating a strategy that helps
business deliver the right message &
product/service to the right audience

BENEFITS OF E-MARKETING

Wider prospect reach

Reduce costs
Increase sales
24*7 Marketing
Provides convenience
Access new markets
Increased interactivity
Increased ability to track result

 E-marketing objectives define what you

want to achieve through your E-marketing
campaign.
Different business may develop different
e-marketing objectives depending on their
individual circumstances .
A useful framework for developing
effective & marketing objectives in the
five Ss frame work , which includes:
1)Sell
2)Serve
3)Speak
4)Save
5)Sizzle

HOW IS E-MARKETING DIFFERENT ?

Cost

Coverage

Audience

Tracking

Interactivity

BANK INSURANCE MODEL

BIM is also known as bancassurance.

BIM allows the insurance company to
maintain smaller direct sales teams as their
products are sold through the bank to bank
customers by bank staff and employees as
well.
The bank and the insurance company share
the commission
This partnership arrangement can be
profitable for both companies.

BENEFITS OF BANCASSURANCE

It encourages customers of banks to purchase

insurance policies and further helps in building better
relationship with the bank.
The people who are unaware of and/or are not in reach
of insurance policies can be benefitted through widely
distributed banking networks and better marketing
channels of banks.
Increase in number of providers means increase in
competition and hence people can expect better
premium rates and better services from
bancassurance as compared to traditional insurance
companies.

LIC BANCASSURANCE

PNB, Kotak Mahindra Bank, IndusInd

Bank, Bhartiya Mahila Bank, Canara
Bank, Federal Bank, South India Bank,
Bank of Maharshtra, Corporation Bank,
United Bank of India, Allahabad Bank,
IDBI Bank, Uco Bank, Dena Bank,
Punjab & Sind Bank, Syndicate Bank
and Kerala Gramin Bank.

ICICI PRUDENTIAL LIFE INSURANCE

India''s No. 1 private life insurer

1) Goa State Co-operative Bank.
2) Jalgaon People's Co-operative Bank.
3) Indoor Paraspar Sahakari Bank.
4) Manipal State Co-operative .

ADVERTISING OF INSURANCE
Advertising is most effective nonpersonal
promotion.

Types of
advertisin
g
Product
advertisin
g

Institution
al
advertisin
g

Awarenes
s
advertisin
g

Marketing and sales promotion activities

were very limited in insurance.

new players resorted to aggressive

marketing and advertisement strategies.

advertisements focused on insurance as an

investment option.

influenced customers to purchase a product.

LIC, was forced to make efforts to increase

its visibility and enhance its brand image.

OBJECTIVES OF ADVERTISING

Creating awareness in the mind of the public about

the need for insurance.
Promoting and positioning various life
products.

insurance

Corporate branding and societal marketing.

Highlighting the various customer centric activities
including consumer education.

LIC ( LIFE INSURANCE

CORPORATION)

Formed as a government regulated

monopoly in1956.
LIC was a financial powerhouse.
The increase in penetration and
awareness could be attributed to the
stiff competition generated among
public and private players.

PEDAGOGICAL OBJECTIVES:

What are the strategies adopted by private

life insurers to grab market share from LIC?

How should LIC use its strengths to maintain

the market share it had in the life insurance
market?

What is the future of life insurance in India?

LIC could join with some private insurers.

STRENGTHS

WEAKNESSES

Staff is lethargic and least

concerned in providing prompt
and sincere customer service.

LIC has a strong and very

well distributed network.

After sales customer grievance

mechanism is inefficient.

It has a large product profile

and claim settlement.

The top management or bosses

are highly corrupted.

It has the advantage of

government guarantee.

Agents not taking in account

the need of people and suggest
them high commission policies.

It has a huge customer base

It is the oldest and the most

experienced player.

SWOT ANALYSIS

OPPORTUNITIES

Emergence of huge middle

income consumer market in
the country.
People are becoming more
aware and demanding so
there is a scope of a whole
lot of innovative products
and services.
Pension market, health
insurance and large real
estate portfolio.

SWOT ANALYSIS

THREATS

There is too much internal

discord.

Entry of new private players

in industry.

Red-tapism is very much

persistent.

LICS MARKETING STRATEGIES

Increased electronic functioning.

Introduction to innovative products.
Maintaining the marked goodwill.
Quick claim settlement.
Avoidance of fraudulent activities.

RECOMMENDATIONS:

To increase the penetration of policies LIC may focus on

products and services that may suit the rural customers.

LIC should also tie up with other banks apart from the one
existing to sell its products.

The company has the option of tying up with NGOs to

market it products to the other sections of the society.

Customer friendly documentation.

Keep a check on its agents that they equally promote the

products.

Some special attention should be given to risk management

while designing the products.

Role of a good distribution network.

Marketing strategies for insurance

products.

How tie-ups and banks can help in

boosting sales of insurance services.