27-08-2020
Life Insurance companies need to sell the policies as a risk tool, not as an investment tool, Mr. Susheel Agarwal, CEO, Ethika Insurance Broking Private Limited in conversation with our Editor in Chief Mr. Vivek JAIN
Insurance Alertss
Q. Insurance companies are into stress how you think this will affect your business?
As per me, the Insurance business is recession proof.
When the markets are flourishing, people will insure because they want to protect the growth. When the markets are not doing good, people will insure because of fear.
The stress on Insurance Companies is not because of survival threats, but because of the need to adapt to the new technological changes, new risks and new industries. As far as impact on our Insurance Broking business, I think it is time to expand both horizontally and vertically.
Q. There is a lot of redemption pressure on life insurance companies, what is your experience?
It might be because of two reasons
1) People need money now to take care of there expenses.
2) People are finding others investment instruments more attractive.
So, Life Insurance companies need to sell the policies as a risk tool, not as an investment tool. People are afraid about losing life, this is the right time to create awareness about term life.
Q. What kind of challenges have you faced in the last 5 months?
As a Insurance Broker, all the challenges we are facing is to deal with the expansion.
For example, 5 months back we didn’t have any plans to get into retail Insurance business or POSP business. But the current market conditions are making us to rethink.
Q. What are the challenges you anticipate for the next 7 months?
This is the moment of truth for the whole insurance industry. Whatever promises the insurance company made at the time of collecting premium, it is the time to prove it.
As an insurance broker, we need to ensure that the trust clients have on insurance industry should not be altered. In the next seven months, we need to assist insurance companies and clients to settle the claims coming out of pandemic faster and without any disputes. Apart from that, we need to keep identifying the new opportunities to expand.
Q. Do you think online sales will take over traditional sales in the next 3 years? 1) If Yes, Why? If No, Why?
Hence in next 3 years online sales and traditional insurance agent sales will become interdependent.
Online platforms will need Insurance agents to give personal touch to sales. These agents will advise clients on the various risks, customized the policy accordingly and give that personal touch to business.
Insurance agents will need online platform for fast and convenient service, transparency and reduce manpower cost.
So my answer is, both sales channels are required and will grow supporting each other.
Q. Are you into Retail marketing, if yes what are your future plans?
I never liked Retail Insurance selling. The client wants to buy the policies because of tax advantage or return on premium. I wanted to sell it purely from risk perspective. So there was always a gap in my values.
However, that trend is fast changing. In this Covid, people understood the importance of insurance. We are making slow progress in getting into retail insurance.
Q. Do you have POS network, if yes how it’s doing and what are your future plans?
We started our POSP vertical. Most of the people who are approaching are already insurance agents and they want to associate with insurance broker so that they can deal with any Insurance company.
Personally, I would like to focus on those people who want to enter into Insurance industry and make it as alternative source of income. We are now started focusing on our training programs which will give them knowledge and skills on how to approach new clients, what to sell and how to sell.
Q. Where will the growth come from in your company?
Insurance broking industry growth is not a factor of which opportunities you choose to pick up. It is a factor of which opportunities you let it go.
Literally every industry, persona can be your client. We need to match that opportunity with our values. Our growth will continue coming from the Corporate Health Insurance. We are adding lot of value to our clients and will keep focussing on this segment.
Q. How many Covid-related claims your company has received so far and how many have been paid?
Around 20% of claims getting reported are because of Covid. However, most of them are recovering at home and hence hospitalisation is not required. Hence very few are eligible for claims and those all are getting paid. There are some disputes regarding the amount of claim settled vs the amount which hospitals are raising. That is getting dealt case to case, after taking it up with insurer.
Q. Which product do you think will do well in the next 2 years and why?
Health Insurance will continue be the most growing segment among health insurance.
Below are the reasons, why I feel so-
Government is supporting by launching policies like Ayushman, national health policy etc.,
Insurers are launching new innovative products. People are more aware of health insurance than ever before. New diseases like corona, Ebola, are getting discovered almost every year. Health costs are increasing because of new medical technologies.
