So the COVID-19 situation which happened was something that I don’t think anyone was prepared for. And especially the biggest challenge for a channel like agency was see agency is all about insurance consultants or agents. And they are the backbone of our channel. And typically in India they have always gone and have done face to face meetings. Suddenly we realized that during COVID-19, customers were very scared to do face to face meetings, and even the insurance consultants were worried because everyone had the fear of the pandemic being so dangerous for everyone. and for the first one or two months there was a big gap because the face to face meetings did not happen and insurance consultants were worried as to how they would be going about doing their business. Insurance consultants also typically Shweta they are not someone who is doing this full time. Everyone is not a full time agent. They have their daily vocations and they are doing their insurance consultancy also. And they realize that there was a gap on their earnings, overall earnings also.
So for us as an organization, the biggest challenge for us was one, how do we take care of our customers during this period and also our insurance consultants because if their earnings are stable they would give a far better service to our customers. So that was very critical for us. And during this COVID period see as an organization, as an agency we were always digital. But somewhere the uptake was not there. During this COVID people realized you know there is an ecosystem which is created, let’s start using it.
What we also did during this period was that we also created new apps which would have simplified the entire user interaction. So our biggest objective was we have to take care of our insurance consultants, we have to take care of their earnings, and importantly the service to the customers should be at the best or the highest level. So I think all the efforts were taken towards digitally reaching out to the customers.
So you just said that digital initiatives were already there with the company but they were not being used. However, you have started using them again. So tell us that overall what types of digital initiatives have you adopted during this pandemic time and what have been the results of the same?
I will give you an example that initially we had already launched something called Insta App where along with the customer, to on board them, it was a completely paperless journey. Because initially when we used to sit in front of the customer, we would take a paper and pen and fill out the entire form. Then they realized that digitally is the way to go or digitally you can scan and do the entire on-boarding for the customer. So the usage increased quite a bit. The second thing is that we had launched an app for our insurance consultants which was called ISMART. ISMART is something wherein an insurance consultant would get all the information he would need about his customer.
But as I mentioned, we were all so habituated to note down in a diary…
Traditional methods, yes we work that way. There is nothing wrong with that. But if we have something available digitally then we should take advantage of it. So people did take advantage of it. It was very critical that the customer’s renewal dates should not pass by. Because during this period if the insurance policy’s renewal date is there, this is not on top of mind for a lot of people.
So how can we as an insurance consultant remind the customers that your renewal date is coming up so please pay the premium. Or if the customer wants to switch funds, as you would have seen earlier, in the initial period in March the markets went down.
So a lot of customers wanted to switch their unit linked plans from equity to debt. So all this switching had to be done. All these services were available online. So people started taking advantage of that. These things were there. And the new things that we had launched, where we started giving the customer all the information on WhatsApp. Customers were used to the WhatsApp app. So whatever information they required on WhatsApp, they could just sit at home and type a simple 1234 number and get all the information. Some things were there from before, but we came to know of its importance later. And we are happy that now we are completely using digital.
How do you see the work environment changing for insurance consultants in 2021? Like you said most of them are not full time. They take it as a vocation. So how has the overall trend changed and what are we looking forward for 2021?
We have a groups of insurance consultants, they are a mix of traditionalists and the millennials who have come in. So the traditionalists would like to still follow physical meetings and the millennials are okay with completely going digital. I think it is a mix of physical and digital. So I was reading one of your interviews and you spoke about Phygital and how that is going to change things. So I mean Phygital is the way forward for us and I think across the industry, now only for us but across the industry, COVID has made us adapt to a lot of changes and Phygital is going to be the future. But also what is critical is that our agents have now understood that it is okay not to sit in front of a customer physically.
Because earlier they would always say sir nothing can be done online because the customers in India will not like it.
But that myth has already been broken in the last 9-10 months. So in the future I think a mix of physical, digital. Also when I realize that with the tools that we have, something like Smart Assist. We said meeting without meeting. How it used to happen before is that we actually had to go and meet the customer, and if the customer’s son or daughter is in the US, they used to do a call or video call and talk to them. Now we can sit in house, so the insurance consultant can be in Bombay, the customer can be in Ahmedabad and his son or daughter could be in the US. And through this Smart Assist App, they could all connect together and see the entire product at the same time. and not only that, an interesting thing here is that over here the entire form filling which you do, the customer can see that. So transparency has gone up to the highest level because the customer’s worry used to be that I want to see what you are filling up. Have you put in my address correctly or not. Here when he is filling it up, he can see it. And not only that, the son or daughter is in the US and if they want to understand why my dad is doing the investments, we can actually see through the quick code which is another innovation that we did wherein an entire story is getting created. For example if a customer wants to buy a policy, normally for customers, what is important for them is that how much money have I given, how much money did I get which is my life goal. Life goal could be kid’s marriage or it could be education or it could be buying a house. So for that it is important how much money do I have to give, how much money will I get, and when will I get it. These are his key questions. So even our story line is made that way where we have removed all the jargon. So even someone who is not very expert on financial literacy, one of the programs that you talk about on financial literacy…
For them also I think it is very simple for them to understand that I have to give so much money for so many years and I will get so much money in this period. And they can do the permutation and combination. So a lot of interesting things have been done and this has now changed the way the agency channel has been doing the business.
How are you looking at the overall insurance penetration in India. I mean even now I don’t think it is that much. So after COVID what type of changes will come? What are you expecting in the insurance industry? How will the things change after the pandemic? Please brief us on that.
So insurance penetration as it is, IDR reports and various reports that we have seen, the penetration in India, I think there is a lot more that can be done.
But what has happened during the COVID period is that and this is what we experienced, and I can give you my own example. I was positive in the month of October myself. And though being in this industry, the first thing that came to my mind when my positive report came, the fear is so high. I started looking at my own investments, my user id, passwords, everything, I told my wife just keep it. If at all something happens. The fear is very high. I can tell you myself I was down for 19 days. So it is not that easy. So the fear of the customer is also very, very high. And what we realized that during this period the pure term insurance sales really went up dramatically. So the customers understood that it is just not about them. It is what legacy they can leave for their families. I think that’s something which is now surfacing which is a very good part. The second thing is that customers are now also understanding that when you talk about various avenues or various asset classes, insurance is now becoming an asset class.
So naturally there are different asset classes, but insurance also when they speak about the life goals – and we have been talking. As an organization we have been talking about living benefits. Normally people have spoken about death benefits. We talk about living benefits that what all do you have to achieve when you are alive. And how can we achieve all that through insurance? So customers have now started. So if you see during this period also, our guaranteed funds also picked up really well. But the customer then understood that this is the amount of money I am investing, I am getting so and so in return. So they were quite okay with that. And then the third thing was when the market started moving up, the way they moved, customers who wanted to be in the unit linked space or in the equity markets, they got into it, and the biggest advantage has always been switching. Because here in our products the switch you can do multiple switches from debt to equity, equity to debt. So when the markets were very volatile they could take that advantage. So it is going up but I think a lot more needs to be done, and hope that people like you are going ahead with financial literacy programs.
Can you please share one last mantra for our investors now when you have mentioned as insurance is also an asset class? So what should be the combination or investment thing that they should look at in terms of asset classes?
So I think first keep your life goals very clear.
So because and I can give you with examples. You know that your kids will need a certain amount of money at a certain age. And you would know that you would retire at some point of time. Maybe you can still keep on working but then your income might come down. So plan your asset classes accordingly. So whatever money you will need in the short term, keeping it in insurance will not help. Because in the short term you will not see that benefit out of it. But from a life goals planning, it is a very good tool to use. Because the biggest advantage, one is there is a lot of discipline. You know unlike other asset classes wherein you can liquidate immediately, here the discipline has to be there. So whether you like it or not you have to keep on investing every year. And that is how your life goals are getting achieved. Second is that everyone should ideally have a term insurance plan. Basic that we say where your insurance cover basis your human life value and the simple example would be whatever is your earnings right now multiplied by 20, keep that basic life cover in place. And that is like a must. And then you can decide on your various life goals and then keep on investing in all the asset classes. Nothing right or wrong in any of them. But insurance has come up as a very interesting asset class for medium term and long term life goals.
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