Trends in Insurance Marketing

Over the past decade the insurance sector in India has witnessed an upsurge in advertising. With the players increasing in the Indian life insurance space it hasn’t been an easy task for marketers to differentiate and make their products stand out in the clutter. Before 2000, LIC was the only player around and life insurance offerings were limited and viewed as a tax saving necessity. Today, one has agents, banks posing as bank assurance partners, NGOs and self-help groups for rural sectors, telemarketing, direct mailing and Internet banking. Current estimates put the insurance industry’s size at about Rs 68,000 crore; using current growth rates, which have been running at roughly 120 per cent a year over the past three years, the size of the industry is expected to be around Rs 2,40,000 crore by 2010. There are all sorts of financial products, ranging from children’s plans and pension plans to endowment/ savings plans. There is a variety of customized products with riders for disability, critical illness and so on.

There is a sudden boom in advertising by insurance companies. The life insurance industry has become very competitive with numerous private players competing in the market. Customers have become discerning today even towards financial services. An average consumer can recall 3-4 brands. Hence it is very important to be visible in the target market.

The most noticeable trend is that a lot of advertisers are shifting away from brand advertising to product advertising. Secondly, the intensity in advertising is making the industry innovate and experiment with its choice of media. Also, as marketers realize the importance of engaging meaningfully with the consumers, consumer activations have begun to demand a more thoughtful approach.

Internet and Direct marketing are expected to play a big role in sales of life insurance. Digital media like the Internet and mobile would become significant in the coming years. Life insurance providers are very bullish on the use of the Internet. Along with the usual banners and pop-ups a new trend of viral marketing and games, incorporated with life insurance messages has been successful for insurance providers. Max New York Life in concert with Zapak.com used this technique to generate leads. Insurers are also using social networking sites like Facebook to popularize its insurance products. People generally have difficulty understanding insurance products. Such branded games make it simple for users to retain the key message as well as product attributes, in a fun-filled manner. It helps in getting attention of young customers in a very simple and fun way, to convince them about the need for retirement income planning right from a young age. With the growing use of digital media, such innovations work well to engage with consumers. Also to retain customers, insurers are launching customer portals that will help them to get information relating to the status of his policy, the amount of loan he can get against the policy and download forms that he requires to start another policy among others facilities. The customer would also be able to use the portal to deposit premium and details about change of address

Direct marketing also allows a more customized approach. Worldwide, insures are using more of direct marketing to target ethnic groups. New York Life set up a cultural marketing division to have better targeted communication to African-American, Asian/Indian and Chinese community. With the African American community they tried to get the agents to connect to the community. New York Life also holds seminars in neighborhood churches on topics like life insurance, annuities, long-term care and college savings plans. To date, more than 1,000 people have attended the events, which always have agents on hand to answer questions and give out materials. A Web site aimed at this segment debuted in March. The site includes an education center, where visitors can search for information based on specific life events (like a new baby, a death in the family or the start of a new business) or financial goals (such as paying for a child's education, accumulating retirement assets or managing taxes).

In India, insures use below the line activities to gain entry to a customer’s house. The marketers are pursuing mall activities, RWA activities and school activities. Activities like cooking classes in a RWA or art competitions in schools are highly popular. Tying up with retail and department chains is also common. Usually one finds an insurance kiosks in any of the retails chains. These activities generally end up yielding very good and hot leads. Insurers are also tying up with rural initiatives like Subhiksha and E-Chaupal to sell customized products to hard to reach customers. This way they get to piggyback on the extensive distribution network of the retailers and increase their reach.

The Indian market though is highly diversified, unites in believing that they are financially stable. In a recent survey by NCAER close to 90% of the people believed wrongly that their futures are secure. So the first challenge for life insurance providers in India is to evangelize the population of India to the need for insurance. As one life insurance company correctly points out “Musibatein bata ke naheen aati”.