Various types of life insurance policies:

Endowment policies: This type of policy covers risk for a specified Period,
and at the end of the maturity sum assured is paid back to Policyholder with
the bonuses during the term of the policy.
Money back policies: This type of policy is for periodic payments of Partial
survival benefits during the term of the policy as long as the Policy holder is
alive.
Group insurance: This type of insurance offers life insurance Protection
under group policies to various groups such as employers Employees,
professionals, co-operatives etc it also provides insurance Coverage for
people in certain approved occupations at the lowest Possible premium cost.
Term life insurance policies: This type of insurance covers risk only during
the selected term period. If the policyholder survives the term, Risk cover
comes to an end. These types of policies are for those People who are unable
to pay larger premium required for endowment and whole life policies. No
surrender, loan or paid up values are in such policies.
Whole life insurance policies: This type of policy runs as long as the
Policyholder is alive and is covered for the entire life of the Policyholder. In
this policy the insured amount and the bonus is Payable only to nominee on
the death of policyholder.
Joint life insurance policies: These policies are similar to Endowment
policies in maturity benefits and risk cover, but joint life Policies cover two
lives simultaneously such as married couples. Sum Assured is payable on the
first death and again on the death of survival During the term of the policy.
Pension plan: a pension plan or annuity is an investment over a Certain
number of years but does not provide any life insurance cover. It offers a
guaranteed income either for a life or certain period.
Unit linked insurance plan: ULIP is a kind of insurance plan, which
Provides life cover as well as return on premium paid over a certain Period of
time. The investment is denoted as units and represented by the value called
as net asset value (NAV).

Different distribution channels in India:

A multi-channel strategy is better suited for the Indian market. Indian
Insurance market is a combination of multiple markets. Each of the markets
requires a different approach. Apart from geographical spread the social
cultural and economic segmentation of the market is very wide, exhibiting
Different traits and needs. Different multi-distribution channels in India are
As follows:
Agents: Agents are the primary channels for distribution of insurance. The
public and private sector insurance companies have their Branches in almost
all parts of the country and have attracted local People to become their
agents. Today's insurance agent has to know Which product will appeal to
the customer, and also know his Competitor's products to be an effective
salesman who can sell his Company, the product, and himself to the
customer. To the average Customer, every new company is the same.
Perceptions about the Public sector companies are also cemented in his
mind. So an Insurance agent can play an important role to create a good
image of Company.
Banks: Banks in India are all pervasive, especially the public sector Banks.
Many insurance companies are selling their products through Banks.
Companies, which are bank, owned, they are selling their Products through
their parent bank. The public sector banks, with their Vast branch networks,
are helpful to insurance companies. This Channel of selling insurance is
known as Bank assurance.
Brokers: Now a days different financial institution are selling Insurance.
These financial institutions are known as brokers. They are taking some
underwriting charges from the insurance companies to sell their insurance
products.
Corporate agents: Corporate agency is a cross selling type of Channel.
Insurance companies tie-up with business houses in other Industries to sell
insurance either to their employees or their Customers. Insurance industry,
during the past 2 years has witnessed a Number of such strategic tie-ups
and alliances. Corporate agents have become a major force to reckon with in
distributing insurance Products.

Internet: In this technological world Internet is also a channel of Selling

insurance. This can be as direct marketing.

EFFECTIVE MARKETING STRATEGIES FOR

INSURANCE PRODUCTS
Now the Indian consumer is knowledgeable and sensitive. Consumers are
Increasingly more aware and are actively managing their financial affairs.
People are increasingly looking not just at products, but also at integrated
Financial solutions that can offer stability of returns along with total
Protection. In view of this, the insurance managers need to understand more
About the details that go into the introduction of insurance products to make
It attractive in this competitive market. So now days an insurance manager
Requires leadership, commitment, creativity, and flexibility. "Every family in
every village in the country should feel safe and secure". This vision alone
will help to bring the new ideas to the insurance manager. Financial,
marketing and human resource polices of the corporations Influence the unit
mangers to make decisions. Performance of insurance Company depends on
the effectiveness of such policies. Insurance Corporations formulate and
revise these policies from time to time to ensure that the performance of the
managers is best for the organization. In the competitive market, insurance
companies are being forced to adopt a strictly professional approach in
marketing. The insurance companies face the challenge of changing the
uninspiring public image of the industry. Some of the important marketing
elements are1.
2.
3.
4.
5.
6.
7.
8.
9.

Marketing mix.
The importance of relationship.
Positioning.
Value addition.
Segmentation.
Branding.
Insuring service quality.
Effective pricing.
Customer satisfaction research.

The growth of insurance sector is governed largely by factors external to it.

The following factors influence the market and demand of product1. Government policies
2. Growth in population
3. Changing age profile
4. Income wise distribution of the population.
5. Level of insurance awareness.
6. The pricing of the policies.
7. The economic climate of the country.
8. The aversion to risk.
9. Social and political features of the country.
10.
Growth scenario in the world.

An insurance product can be classified into three

Phases:
1. Core product: In insurance industry the core product is the policy that
provides protection to the customers.
2. Expected product: Because of competition customers start to expect
more from an insurance product. Then insurance companies provide some
tangible attributes in their product to differentiate from Competitors, such asBrand
Some additional features in existing product
By providing instruction manual with the policy
3. Augmented product: An insurance company can provide different Types
of services to differentiate their products1.
2.
3.
4.

Post-sales services.
Branches in different places for customers.
Customer complaint management.
Payment option convenient to customers.

The entry of private players and their foreign partners has given domestic
Players a tough time, because the opening up of the sector has not brought
in only foreign players, but also professional techniques and technologies.
The Present scene in India is such that everyone is trying to put in the best
Efforts. There are marketing strategies more for survival than growth. But
the most important gift of privatization is the introduction of customer
oriented Services. Utmost care is being taken to maximize customer
Satisfaction.

Success of an insurance company depends on four

important functions:
Identification of markets: Identification of markets means need to
Understand the trends in culture and businesses constantly, through
Conducting research and analysis. Insurance companies can take this Job on
their own or assign it to an external agency. Relying on an External agency
can be risky due to the questionable loyalty of the Agents.
Assessment of risks and estimation of losses: Efficiency of actuaries
And assessors of the insurance policies in fixing premiums and settling
Claims is foremost an important area for achieving overall efficiency In
operations. The quality of assessing the risk and estimation of Losses has the
largest claim on the performance of an insurance Company. Well-trained,
experienced and expert hands are needed for the operations.
Penetration into and exploitation of markets: Market penetration or
Exploitation of a company can be identified with the growth in Number of
policies in each type of insurance, growth rate in earnings Or turnover,
companys market share, increase in number of branches and divisions etc.
Efforts of the company as a whole and that of the Divisions and branches are
assessed to measure the effectiveness.
Control over investment and operating costs: Control over Resources
such as men, machines, and materials at each level of the Organization
provide measures of efficiency of a unit as well as the Organization.
Investment control and expense control are dealt separately and the
effectiveness of managements decisions at various levels is to be assessed
separately.