SALES & DISTRIBUTION ASSIGNMENT

“Strategy for selling Insurance products in India and

Odisha”

Submitted to:
Prof. Rahul Gupta Chowdhury

Submitted by:
Ayushi Kumar
Roll No. 17
Introduction
Insurance is a means of protection from financial loss. It is a form of risk management,
primarily used to hedge against the risk of a contingent or uncertain loss.
An entity which provides insurance is known as an insurer, insurance company, insurance
carrier or underwriter. A person or entity who buys insurance is known as an insured or as a
policyholder. The insurance transaction involves the insured assuming a guaranteed and known
relatively small loss in the form of payment to the insurer in exchange for the insurer's promise
to compensate the insured in the event of a covered loss. The loss may or may not be financial,
but it must be reducible to financial terms, and usually involves something in which the insured
has an insurable interest established by ownership, possession, or preexisting relationship.
The insurance industry of India consists of 51 insurance companies of which 24 are in life
insurance business and 27 are non-life insurers. Among the life insurers, Life Insurance
Corporation (LIC) is the sole public sector company. Apart from that, among the non-life
insurers there are six public sector insurers. In addition to these, there is sole national re-insurer,
namely, General Insurance Corporation of India. Other stakeholders in Indian Insurance market
include Agents (Individual and Corporate), Brokers, Surveyors and Third-Party Administrators
servicing Health Insurance claims.
The Indian insurance market is a huge business opportunity waiting to be harnessed. India
currently accounts for less than 1.5 per cent of the world’s total insurance premiums and about
2 per cent of the world’s life insurance premiums despite being the second most populous
nation. The country is the fifteenth largest insurance market in the world in terms of premium
volume , and has the potential to grow exponentially in the coming years.
The total insurance market expanded from US$ 23 billion in FY05 to US$ 84.74 billion in
FY17.
Life insurance companies in India earned US$ 25.12 billion as first year premiums in FY17
and Rs 1.51 trillion (US$ 23.32 billion) in FY18*.
By 2021, Oxford Economics projects revenue from health insurance premiums to reach
US$3.5b, representing growth of more than 12% annually since 2006. Growth averaged just
over 11% from 2006 to 2014.
Because so few Indians now carry health insurance, India has one of the world’s highest rates
of out-of-pocket spending in health care. According to World Health Organization (WHO)data,
the public sector in India spent just 1.46% of gross domestic product (GDP) on health care,
ranking 187th among 194 countries and at a ratio about half that of neighboring China, which
has made health care far more of a government priority.
Various illustrations are given below:
Sales Strategy for India
1. Family Insurance - One strategy to “de-risk” the health insurance pool and develop a
deeper base of customers is to insure an entire extended family, from infant children to
aunts and uncles, a tactic the insurer Max Bupa has initiated. An extended Indian family
can encompass 40 or 50 people, and by offering coverage to an entire family clan,
insurers can significantly grow the customer base and also guarantee they are covering
healthy younger patients rather than just the elderly who tend to suffer from chronic or
other life-threatening diseases.

2. Linking Coverage with Wellness - A number of new players in the health insurance
market are linking health insurance programs to smartphone applications that monitor
physical activity or visits to the gym.

3. Creating networks that link coverage to care - By linking a smart app on a phone to
covered patients, it will cut the hospitalization required of diabetes patients and engage
patients in preventive steps that keep them out of the hospital in the first place.

4. Wellness - It highlighted that the success of wellness in India can only be achieved
through a self-sustainable ecosystem between the insurer, health care provider, wellness
provider and customer.

5. Digital solutions to counter high marketing and distribution costs- As these

examples show, a number of Indian insurers are betting on smartphone applications that
will allow clients to track their vital signs, communicate directly with their insurers,
and find and schedule appointments with doctors. Digital solutions are seen as a cost-
effective way to counter high marketing and distribution costs and to create a new sales
channel, distinct from the bancassurance model or the use of brokers. Apollo Munich,
for example, is offering very low-cost insurance to cover against dengue fever that can
be purchased directly via smartphone. Additionally, companies should invest in
analytics and predictive modeling to improve customer experience, claims management
and fraud detection.

6. Rural Market - In India’s rural areas expanded government coverage will likely be
required to care for large numbers of poor citizens, and educational efforts will still be
required to explain the benefits of health coverage to those who have never benefited
from it.

7. Market Potential - In addition to growth prospects for the general economy that are
far higher than for most developed markets, India has enormous unmet needs for health
care and a huge population of uninsured residents. Even among emerging markets,
India is one of the least insured countries, with a health insurance penetration rate of
only about 20%.
 8. Promote your Green-ness- this sales strategy for insurance agency can be done
through providing details regarding how to get more clients efficiently or minimize
costs of energy in the household. Send newsletter and email to your customers, or host
learning session in your workplace for your clients. Take account of insurance agency
advertising material in the whole thing you offer.

Strategies for Odisha

After analyzing the CMIE data base, for various districts of Odhissa, we can figure out the
parameters such as MII & MPV of the various districts and their per capita income, affluent
household percentage and contribution from means.
 Khorda district: Capital Bhubaneswar belongs in this district, has the highest magnitude
of MPV of 62.26 and it also has Urban MII of 184.57 and rural MII of 75.29, so we
will establish a sales control unit in this region. Four to five sales control units will
guarantee the maximum coverage of the area based income, class, status etc.
 Cuttack District: This district has the highest magnitude of Affluent households 31.61
and second highest urban MII of 162.2 with a percapita income of 32.18, so we can go
for premium health policies for people of these areas. Coverage can be increased by
setting up sales units in some places.