Jitin Paul, CMO, Bharti AXA Life Insurance explains how innovation is the key to success in the insurance segment, why private players are lagging behind the insurance giant LIC and why booking insurance online has still not taken off in a big way in India
BY NEETA NAIR
Q] What are the benefits that a customer would get under your ‘Grief Support Program’?
So, the Grief Support program in fact is a part of the service offering of our products, which means that each and every customer who buys a life insurance policy from us will get this service benefit as part of the overall proposition. Why does somebody invest in life insurance, the obvious answer is to minimize distress for their family members in case of unfortunate circumstances. The insurance money reduces the financial distress in some ways but there is distress beyond that which is far deeper and emotional by nature. So we came up with the Grief Support Program which includes emotional counselling with qualified psychologists, a third party certified financial planner and a legal expert who gives a second opinion on the wills. So we are going beyond the transactional relationship to a more personal relationship with the customer.
Q] What are the different ways in which you are promoting this campaign?
Television is the lead medium for us, largely because budgets are not unlimited and television gives us the biggest bang for the buck. We used to have Print and Outdoor at one time, but have replaced that with Digital. Unlike the earlier joint family set-up, nowadays families are pretty much on their own three-four days after a loved one’s death. Hence we decided to talk to the Tata Institute of Social Sciences to commission a white paper in the area of grief and loss. We are taking it forward with a press conference and some round table discussions on the subject. Now that we have picked up a cause, we want to run the full distance with it. Also the male corridor, which is our target audience, was anticipating the India- Australia test series in a big way so we decided to become its associate sponsors. The final test finishes off in the last week of March which is also the end of the financial year, so it fits perfectly.
Q] Is the primary target audience for Bharti AXA still the male?
In the classical marketing sense, we reach out to 25-44 year old socio-economic class A & B, the primary target audience is SEC A&B male. Till now male is a primary buyer of financial services but now we can’t discount the influence that the woman of the house wields. But we have started looking at women very seriously as an influencer in the category. Women Graduates have grown by 25% in the past 10 years. But only 10%-15% of them are joining the workforce. Majority of them get married and are homemakers but if you go out and interview couples, you will realize that the lady of the house has a lot of say in financial matters today because she is educated. Also she has a lot of time on hand compared to their counterparts in the family to do the analysis. Our relationship managers have seen more and more women walking into their husbands of late.
Q] According to The Insurance Regulatory & Development Authority in the year 2015-2016, Bharti AXA’s claim settlement ratio, a key attribute for measuring performance of an insurance company, was around 84.79% while LIC’s and Max Life’s stood at 98.19% and 96.23% respectively, how are you going to improve that?
Of course, everything can be improved. But absolute numbers can be confusing, for example a 2% on a huge LIC base would be more than my customer base put together and Max is no different, they are amongst the top five players in the market. So, I think the numbers need to be looked at with a little bit of judiciousness. But yes we need to settle claims on priority for which we have a dedicated claims handler, a first in the category. We are following the gold standard of claims management process laid down by the regulator.
Q] What percentage of people are booking Bharti AXA Life Insurance plans online through your website?
Overall in the insurance sector I believe around 1% of the policies were booked online in 2016, while for Bharti AXA that percentage stands at 2%. Insurance is a high involvement category from a marketing standpoint. Unlike a candy you pick up before you checkout in Big Bazaar, here you are taking a call on how to invest money for the next 15 years to protect your family which demands a face to face interaction, which Digital doesn’t provide for. Till date Life Insurance is a category which is sold and not bought. Nobody gets up in the morning and says I want to buy a life insurance policy, they have to be persuaded. However research shows that while people prefer to buy insurance offline, they are doing the research for picking the right one online.
Q] How are insurance intermediaries like Policybazaar and CoverFox affecting Bharti AXA’s business?
On one hand these sites help consumers because they compare policies provided by 20 plus players in the market. While on the other it makes insurance companies like ours focus a lot more on innovation because it’s a comparative world at the end of the day. You need to have a better service proposition like a Grief Support Program to sell on these sites and have to go beyond plain transactions like - cheapest plan at Rs 19 per day. So eventually if we have a better product and service, we are bound to sell on such sites.
Q] After 15 years of industry opening up, the number of life insurance policies sold by private companies is around 1.5 million approx and that by LIC is close to 30 million, where are the private players going wrong?
But private players have around 25-30% of the overall pie of the market share with respect to ticket size of the policies. So we may not stack up on the numbers but in terms of the value we have a significant share.
Q] Where does Bharti AXA stand in that market?
We have around 1.29% of the market share amongst private players as of FY16. See the reason why people buy a life insurance policy from a particular brand primarily depends on trust and there are surrogates for trust like lineage. Among the long standing insurers, apart from LIC that is more 65 years old, some have over 15 years of legacy in insurance in the market and some are part of major conglomerates. If a customer is relatively less educated about a category then he will prefer a brand he has been hearing about for years, and LIC leads the pack there. Another surrogate for trust is financial expertise which means insurance policies from banks will be preferred.