The Hindu : Tamil Nadu / Chennai News : Insurance industry urged to fulfil aspirations of the middle class

Online edition of India's National Newspaper
Sunday, Sep 17, 2006
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Tamil Nadu

Tamil Nadu - Chennai

Insurance industry urged to fulfil aspirations of the middle class

Special Correspondent

Those earning income have many investment options: LIC chief

CHENNAI: The life insurance and personal insurance industry cannot fully realise its potential unless it meets the "aspirations of the expanding middle class" in the wake of the faster economic growth spurred by the reforms since 1991, Life Insurance Corporation of India Chairman T.S. Vijayan said.

Delivering the inaugural address at the fourth annual convention of the Life Underwriters Guild of India (LUGI) here on Friday, he said disposable incomes were steadily increasing. At the same time, the income-earners had many opportunities to spend or invest their funds, and this presented the biggest challenge to insurance marketing professionals.

To add to this, consumers were getting information independently from media about products and choices available. Though consumers' knowledge was not deep enough to enable them to understand the complexities of different savings and investment instruments, they believed that they knew everything and that they were expert in the subject. The insurance professional needed to possess superior knowledge to be able to persuade his potential customer, Mr.Vijayan said.

He drew a parallel between the insurance professionals and stock brokers, who could no longer function the way they used to when their customers could be taken for granted and kept ignorant about the commissions being made or the deals concluded. Similarly, the insurance intermediaries would have to win the trust of customers and understand the way the economy, business culture and life itself was changing, Mr. Vijayan said.

Andrew Goh, a sales motivation specialist and trainer from Singapore, said people do not want to be "sold insurance," and hence they need to be "helped to buy insurance." Those who looked at cost would not look at value.

Thus it was the marketers' job to understand and convey to the public the value of life insurance and what it meant to them in terms of their needs and that of their families, through the right mix of insurance products.

LUGI president P. Srinivasan, referring to the accreditation given recently to the LUGI by the LIC and the Million Dollar Round Table, said insurance agents and financial advisors should "create opportunities for their growth" by upgrading their skills and knowledge.

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