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Interview of James Walton, CEO,
Allianz Bajaj Life Insurance
1. What is your product USP?
The unique features of all our products are that they offer
flexibility in coverage and give the customer an option to
add or remove additional benefit combinations. All our product
features, have been designed keeping the customer in mind.
For example:
- We offer Daily Hospital Cash for covering costs for hospitalisation
- We offer an option to select a quadruple death cover for
Save Care
- The Survival benefits are paid out at age 80 for Lifetime
Care
- We offer coverage of maximum number of critical illnesses
(11 in number while the common industry practice is to cover
5-9 illnesses) and continuance of policy even after payment
of 100% sum assured
- Our premiums calculated for age attained on the last birthday,
as opposed to those calculated for the age to the nearest
birthday.
2. How many policies did you sell last fiscal and what
was the premium garnered?
We sold over 22000 policies over a short period of operation
of 5 months and garnered an annualized premium of over 12
crores in the last fiscal.
3. What are your projections for this fiscal?
We are planning to sell over 1 lakh policies and double our
agency force from its current strength of 6000 agents by the
start of the next fiscal.
4. How many agents do you have on your roll?
We currently have approximately 6000 Insurance Care Consultants.
5. Which are the corporate agencies your have tied up
with?
We have relationships with over 35 leading financial distribution
intermediaries spread all across India.
6. Recently LIC is said to have hiked its advertising
budget to around Rs 100 crore and plans to launch a mega campaign
endorsed by celebrities to take on competition. In the face
of such developments what marketing plans have you chalked
out?
LIC has been the main beneficiary of the increased public
awareness and interest generated by the new companies with
the opening up of the insurance sector. With growing awareness
about the new players and the spread of their distribution
network we expect the share of growth going to the new insurers
to increase with rapid pace. Competition is always a challenge
and will increase more so in the coming years. However Allianz
is worlds number one in API and is used to competition so
competition is something we at Allianz Bajaj have always look
forward to.
7. What is your advertising budget and how do you plan
to take on competition?
Our advertising strategy is very straightforward. We realize
that that our advertising should not just reach the consumer
but also assist the Insurance care consultant as they make
sales. Also it is very important for our advertising to reach
the same target audience who our Insurance Care Consultants
target. Thus we have planned a series of below the line activities
as well as mass media activities to meet these objectives.
8. How do you plan to go about improving brand awareness
of your product?
Our focus is on our agency force, their training, and understanding
of the products and communication of the same to the end customer.
In fact they are best brand ambassadors. Thus we intend to
do our brand building primarily through them. Of course we
will simultaneously support them with the appropriate brand
building through mass media support and other awareness building
exercises.
9. While awareness has been increasing it is still observed
that the slant is towards LIC products. When do you think
a situation will come when customers will ask for private
insurers' products by name?
LIC certainly has definite strengths of distribution, reach
and size of sales force in addition to their understanding
of the Indian market. We do believe that although insurance
is sold, brands can be bought. With the current consumer becoming
more aware about insurance and its benefits as well as about
the choices available in the market it will not be long before
the customers will make their personal selection of brands.
However I strongly believe that the company that delivers
at the time of need will emerge as the preferred choice. It
is this belief that we at Allianz Bajaj are confident of establishing
among our customers.
10. What exactly is bancassurance all about?
While there are many definitions, in essence Bancassurance
is all about getting Bank customers to also invest in the
most basic of financial products to ensure the protection
of their families.
11. Do you plan to adopt the bancassurance route? If so
which banks have you tied up with and when do you plan to
roll out products through banks?
Yes, Allianz worldwide specialises in Bancassurance. Allianz
sometime back also acquired Dresdnar Bank, which only indicates
the seriousness of Allianz's focus on Bancassurance. Now that
the Bancassurance regulations will be out shortly, insurance
companies will be able to tie up with banks on the basis of
the regulations. Already, at Allianz Bajaj we have a tie up
with Indian's largest foreign bank Standard Chartered and
talks with other banks are on.
12. Which risk products do you plan to sell through the
bancassurance route?
In view of the environment that life insurance is sold in
a bank, products need to be designed specially that can also
ride onto existing bank products. A perfect example of a pure
risk product would be a Mortgage Cover product. We feel it
is incorrect to take on a mortgage without an insurance cover.
Even if something were to happen to the Loanee, at least the
family will still get to keep the roof over their heads. Bankers
will tell you heart rending tales of how they have to exercise
repossession right to families who are already in the throes
of tragedy. Following from this Bank Mortgage products will
shortly be bundled with a Mortgage cover and sold as a value
add on to customers.
13. With individuals being used to the agency route of
personalised service how far will bancassurance as a channel
of insurance distribution be successful especially when insurance
is not bought but sold in our country?
Not just in India, this is an aphorism that is true for any
country. However, having stated this one interesting facet
is coming to life. A good advisor sells his product as the
last step of his sales cycle. In the Allianz Bancassurance
world, we have introduced a new " 4 minutes...."
concept that starts by bringing the customer up the curve
on his insurance basics. Slowly, the advisor moves on to the
"risks" that the customer runs and the value that
the Life insurance adds to his "family". We have
observed that customers soon get involved and end up "buying"
the product and not " being sold " the product.
We feel that this paradigm change can happen at the hands
of a well trained advisor.
14. In the absence of necessary regulations regarding
bancassurance how do you plan to go about in case of disputes?
Regulations have been cleared by the Parliament so they will
be issued shortly
15. Since there will be considerable reduction in costs
(costs of agent recruitment/training) while opting for the
bancassurance route will the benefits be passed on to the
customers?
Allianz sees this as a good channel for business not because
of cost issues but because of revenue benefits. There is a
captive audience that a Bank has and we want to be the first
ones to reach this customer!!!!!
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