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Published in Business World, on 28th April 2017
Vighnesh Shahane, CEO, IDBI Federal Life Insurance, Kapil Mehta, Founder & EO, SecureNow Insurance Brokers, Shirish Pathak, CEO, Fintelekt and Nilesh Parmar, COO, Edelweiss Tokio Life Insurance shared the stage for the panel discussion on nurturing a healthy distribution ecosystem. Aniruddha Bose inaugurated the discussion by asking the changes for policy holders in the sector.
“There has been some positivity in the holder protection rights, although there are many changes one can talk about. But the most important change involves addressing to trust deficit and resolving customer grievances. The customers are bound to either go to insurance companies to solve their doubts and if they receive no help from there then they might go to consumer courts. Hence the primary change in the distribution ecosystem involves addressing the grievances of the customers and in the current year we have been improving in that field as well.” Says Kapil Mehta
Further to the discussion the panelists discussed the challenges in maintaining the policy distribution ecosystem. The discussion involved the distribution of information to customers by policy provders in India and lack of information and miss-selling are the key points to work upon in developing the sale of policies and insurances where the company and customer both are benefited. Vignesh Shahane further stated
“The greatest challenge according to me is trust deficit at this point of time. Currently we haven’t had discussions and information to be provided in detail to customers when it comes to buying policies and insurances and we need to distribute right knowledge then the right product to the customers. People fail to see the element of miss buying as the key problem here because there should be a two way communication in understanding how the right insurance and policy can benefit the right customer. I’m surprised to understand that a lot of customers don’t know about the policies they buy and then have complaints regarding the interest rates that they receive. Policy holders shall be informed on the insurance they purchase according to interest rates.”
The members of the panel discussed that insurance products need to simplify their policies and rules and regulations as far as product simplification is concerned. Miss selling are carried forward by wrong people because insurance is a difficult product to sell and lot of salesmen distribute various products to meet their sales targets. One of the key understandings for this kind of policy distribution involves low commission that elaborate the glitch in the healthy distribution ecosystem in the Insurance sectors of India.
Nilesh Parmar during the discussion stated “India is all about buying insurance, if we as an insurance industry fail to see what the customer is buying, then in a way we may be held responsible for not providing accurate information. Hence there should be a combined industry effort towards focus on customer retention rather than acquisition.”
Shirish Pathak elaborated the conditions of the current Insurance industry of India during the discussion and described the issues according to his views and understanding.
“It is feasible to build a business in today’s market if we follow 100% need based approach. No doubt it is a joint responsibility between policy givers and policy holders which is why any insurance company should not issue any policy without confirmation to customers. Miss selling of insurance can be brought down if companies think of the customers more than the profit for agencies. Besides that a lot of panel discussions and information providing gateways are also strengthening and educating more and more customers to understand the types of policies that are available and their benefits which is also stating that the miss selling are reducing in the current year.” Says Shirish