Skip to main content

Customer Focus, Efficiency to Drive Insurance Companies

Invest Mutual Funds Online

Call 0 94 8300 8300 (India)
2010 PROVED a watershed for life insurance companies and customers. The new Ulip regulations that came into force in September 2010 changed the face of the life insurance business with customer centricity and efficiency becoming the industry's new buzzwords. These will continue to be the defining factors for developments in the realm during the current year, but at a much accelerated pace.


   The initial months after the regulations took effect saw both customers and insurance companies tread with caution. Sales progressed slowly with companies introducing two-to-three near similar Ulips to test new ground, leading to commentaries of non-differentiation between offerings by different players. However, the regulatory changes augured well for all stakeholders and by the end of the year, customer interest and sales picked up substantially, giving insurance companies the much needed confidence boost to introduce newer and more innovative products. Insurers have progressively started introducing such products covering areas including, child plans and single invest plans. This trend should pick up pace in the current year. Single invest plans especially are expected to witness good investor interest given their attractiveness as an excellent investment vehicle. Enhancing efficiencies and thereby productivity of delivery channels is the central challenge for insurance companies in the new regulatory environment.


   Renewed emphasis will be placed on highly efficient channels such as Bancassurance which, in turn, will considerably gain in strength and leverage. A significant proportion of insurance is still sold through individual agents. Managing this channel effectively is the key to ensuring persistency. One can expect developments that will seek to strengthen the effectiveness and commitment of the agency force to ensure that the customer receives consistent level of service through the policy term besides reduce the number of orphan policies (a term used to denote those policies whose agents are no longer active). Further, mandatory need-based selling whereby insurance agents will be required to assess the customer's exact insurance needs based on his financial and personal profile may become an integral part of the sale process. This should check mis-selling. Companies on their own accord can also be expected to add check layers to weed out any remaining scope of mis-selling.


   ll these necessitate greater commitment by the insurers to agent education which will result in better quality of advice, reducing customer churn and improving persistency — a key for insurers to succeed in the new reality. New and innovative outreach mediums that not only rationalise cost but also find increasing customer acceptance such as online and mobile platforms are expected to gain significant traction going forward. Some insurance companies have already introduced products exclusively designed and structured for online selling.


   The overall cost of insurance has progressively reduced over the past decade, and this trend will continue in the time to come. While premiums on pure-term policies have dropped by a 50%-60%, commission as a percentage of premium has also reduced from 9.1%-7% over the past five years. This has enhanced the appeal of insurance and brought it within the easy reach of millions. Further, with the country's GDP and savings rate growing phenomenally, interest in investment products per se is expected to scale up significantly. Insurance, with its safety premise and longterm investment appeal, should significantly benefit from these factors.
 

Happy Investing!!

We can help. Call 0 94 8300 8300 (India)

Leave your comment with mail ID and we will answer them

OR

You can write back to us at PrajnaCapital [at] Gmail [dot] Com

 

---------------------------------------------

Invest Mutual Funds Online

Transact Mutual Fund Online

Download Mutual Fund Application Forms from all AMCs

Download Mutual Fund Application Forms

Best Performing Mutual Funds

    1. Largecap Funds Invest Online
      1. DSP BlackRock Top 100 Fund
      2. ICICI Prudential Focused Blue Chip Fund
      3. Birla Sun Life Front Line Equity Fund
    2. Large and Midcap Funds Invest Online
      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
    1. Mid and SmallCap Funds Invest Online
      1. Reliance Equity Opportunities Fund
      2. DSP BlackRock Small & Midcap Fund
      3. Sundaram Select Midcap
      4. IDFC Premier Equity Fund
    1. Small and MicroCap Funds Invest Online
      1. DSP BlackRock MicroCap Fund
    1. Sector Funds Invest Online
      1. Reliance Banking Fund
      2. Reliance Banking Fund
    1. Tax Saver Mutual  Funds  Invest Online
      1. ICICI Prudential Tax Plan
      2. HDFC Taxsaver
      3. DSP BlackRock Tax Saver Fund
      4. Reliance Tax Saver (ELSS) Fund
    2. Gold Mutual Funds Invest Online
      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund

 

Popular posts from this blog

What are the factors affect the changes in Interest Rate of Fixed Deposits?

  What are the factors affect the changes in rate of Fixed Deposits? Fixed Deposits are now considered to be a very old fashioned method of saving, but still attract many investors since they have guaranteed returns at the end of the tenure of the investment at a decent interest rate. There are various factors that affect the rates of interest for a Fixed Deposit. Policies of the Reserve Bank of India   - The several norms and restrictions posed by the Reserve Bank of India , in order to gain optimum control over credit and inflow and outflow of fund throughout the country. The repo rate changes, cash reserve ration tends to change and these changes affect the banking products like Fixed Deposits, loans etc. Recession   - When unemployment in a country crosses the benchmark set Recession hits, and slowly the country faces an economic slow movement, affecting the purchasing power of the people in the country, forcing the Reserve Bank of India to release more funds in the financial marke...
Read more

Understanding Your Cibil Credit Information Report

   WE ARE all familiar with the anxiety and uncertainty that we feel when applying for a loan. After all, it's the lender who decides whether we can own our dream home, our first car, or whether our children can pursue higher education. In a nutshell, a better life depends on the lender's decisions.    While other factors do play a part in the lender's decision, the Cibil Credit Information Report ( CIR ) plays a crucial role in a lender's decision to approve a loan application.    Previously, lenders would treat all loan seekers equally. Each applicant, if approved by the lender's internal credit policy, would be charged at the same interest rate for a particular loan size and purpose. The lenders would charge a higher interest rate to all the borrowers, in order to compensate for the possible default of a small portion of the loan disbursed. In other words, it's like a professor (the lender) punishing an entire class (borrowers) for the mischief played b...
Read more

Capital Protection Oriented Funds

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   Capital Protection Oriented Funds   Erosion of capital is one of the key concerns for investors wanting to invest in equity mutual funds. To address this concern, asset management companies have launched Capital Protection Oriented Funds (CPOFs). What are CPOFs? CPOFs are generally three to five-year, closed-ended funds where 70-80% of the portfolio is invested in fixed income securities, which mature on or before the scheme's tenure. The investment in fixed income securities grows to 100% at the end of the tenure, providing the investor with capital protection. The remaining portion (20-30%) is used to take exposure to equity, which provides the upside. Exposure to equities is either by directly buying equity stocks (plain vanilla CPOFs) or by b...
Read more

Mutual Fund Review: ING Dividend Yield

  ING Dividend Yield's small assets enable the fund manager to churn in impressive returns… Strategy The aim of the fund is to invest in stocks which offer a high dividend yield. This fund deploys a value based strategy which aims to gain from investing in fundamentally strong and free cash flow generating businesses. The scheme focuses not only on growth but also on the cash generated by the business, which mostly leads to stable returns even in volatile markets. This fund has a low volatility because of its investment in high yielding stocks. The scheme tries to include stocks that yield dividend above the dividend yield of the Nifty and stocks with liquidity, which throws up a universe of 150 stocks.   Our View Launched in October 2005, this fund invests at least 65 per cent of its assets in high dividend yield stocks. The fund has consistently maintained a mix of stocks across varying market capitalisation, with a higher tilt to mid caps compared to small caps. Howev...
Read more

Good Loan

Why Is It A Good Loan?: Loans against gold are cheaper and better than personal loans as the former are available at lower interest rates. In contrast, the interest rates on personal loans are not standardised and can vary from bank to bank. Also, a personal loan depends on a host of factors including, the borrower's salary, profession and the purpose for which the loan is being taken.      For instance, the interest rate on a personal loan of 5 lakh falls in a wide range of 15-30%. But loans against gold are available for as low as 11%. Secured borrowing such as a loan against gold, investments or property is cheaper because it is backed by some assets, which command a good value at any point of time. If the borrower defaults on the loan, the banks can liquidate the assets to settle the loan account.    Being a secured loan, the risk of default and credit losses is significantly lower in this loan compared to other forms of loan for personal use. Given the lower risk, gold loa...
Read more
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now