Life Insurance Marketing in India (B) The Changing Distribution Norms

Distribution Initiatives of the New Players Contd...

According to Anuroop Singh, CEO, Max New York Life, the new distribution channels would not be able to completely replace individual agents. He said, "Over 90% of the life insurance schemes the world over are sold through individual agents. Agents will be the primary channel of distribution in India and so we have invested substantially in training our life insurance agent advisers here." Max New York worked towards making the quality of its agents its main differentiating factor. The company adopted the career agent system instead of LIC's general agent system. Max New York paid attention to the agent selection process so as to recruit the best talent available. The selection process comprised four stages – screening, psychometric tests, career seminars and final interview. Agents were trained in the various products the company offered and the insurance needs of the customers so that they were in a position to offer them sound advise.

The training covered 152-hours, instead of the mandatory 100 hours stipulated by IRDA. The program involved modules on understanding the consumer psyche and the financial market, and developing selling skills and the right attitude.

Commenting on the need for training agents, Mr. Debashis Sarkar, senior vice president, marketing, Max New York, said, "Internal employees are all opinion shapers and indirect brand-builders and brand promise needs to be replicated down the chain at every customer touch point."

The company also made training an ongoing process, and ensured that the training program addressed the needs of agents through development of skills and knowledge through a program spreading over 500 hours over two years.

HDFC Standard Life decided to rely on individual consultants and corporate agents for distributing its products. According to company sources, individual consultants were expected to play a key role in the sales process. The company therefore invested 20 man-months in developing training programs for consultants.

The company also trained its consultants through institutions approved by IRDA. In addition, HDFC Standard Life tied up with corporate agents all over country. It had already tied up with HDFC and some other banks to distribute its products. To increase its coverage in rural areas, HDFC Standard Life held talks with NGOs that were involved with HDFC's housing schemes in rural areas.

Birla Sun Life announced the appointment of Village Extension Workers (VEWs) who would help create awareness about insurance in villages. Generally, these VEWs were from social improvement projects promoted by the Aditya Birla Group of companies. Each VEW was put in charge of a cluster of 10-15 villages.

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Case Details

Case Code : MKTG027
Themes: Distribution
Case Length : 10 Pages
Period : 2000-2002
Organization : ICICI Prudential, Max New York Life, ETC
Pub Date : 2002
Teaching Note : Available
Countries : India
Industry : Insurance

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