Internet as a Insurance Distribution Channel
Internet as an Insurance Distribution Channel- An Empirical Study Jaya Nema Sr.Faculty, LNCT-MER,Indore
Introduction
After the liberalization of Indian economy various reforms has been made in the insurance sector which has finally opened the gate of this industry for private sector companies. This has brought changes not only in the design of the products available in the market but also the manner in which they are marketed. There is a pragmatic change in the customization of latest products and services, regulatory norms, customer demographics, channels of distribution, greater use of information technology especially as a service facilitator. Even consumer preferences have been changing noticeably influencing the product mix offered by various public and private insurers. A vast potential exists in the Indian market as the demographic factors like average life span and standard of living are improving creating a demand for products that can offer protections and also double up investments of the customers. Also because of liberal government norms and India’s large population which now possess greater risk awareness, Indian insurance market has a global framework attracting major international insurance companies.
All these above mentioned factors are directly responsible for increased competition and shaping the overall insurance industry with new parameters. To harness the opportunities insurance companies must go close to the customers by expanding their distribution network.
Insurance Distribution – A Micro View
The liberalization of the Indian insurance industry in the year 2000 led to the entry of private insurance companies with Multinational companies as their partners For them ,breaking the large agent led network of LIC which was enjoying the monopoly for decades was extremely tough. They decided to use aggressive advertising and promotional measures and also other untried distribution
Introduction
After the liberalization of Indian economy various reforms has been made in the insurance sector which has finally opened the gate of this industry for private sector companies. This has brought changes not only in the design of the products available in the market but also the manner in which they are marketed. There is a pragmatic change in the customization of latest products and services, regulatory norms, customer demographics, channels of distribution, greater use of information technology especially as a service facilitator. Even consumer preferences have been changing noticeably influencing the product mix offered by various public and private insurers. A vast potential exists in the Indian market as the demographic factors like average life span and standard of living are improving creating a demand for products that can offer protections and also double up investments of the customers. Also because of liberal government norms and India’s large population which now possess greater risk awareness, Indian insurance market has a global framework attracting major international insurance companies.
All these above mentioned factors are directly responsible for increased competition and shaping the overall insurance industry with new parameters. To harness the opportunities insurance companies must go close to the customers by expanding their distribution network.
Insurance Distribution – A Micro View
The liberalization of the Indian insurance industry in the year 2000 led to the entry of private insurance companies with Multinational companies as their partners For them ,breaking the large agent led network of LIC which was enjoying the monopoly for decades was extremely tough. They decided to use aggressive advertising and promotional measures and also other untried distribution
References: 1. Kamal Nayan Agarwal(2004), “Factors that influence the Success of Internet Commerce,” Journal of E-Business, Vol.4,Issue 2, December. 2. Randy E Dumm and Robert E Hoyt(2002),’Insurance Distribution Channels: Markets in Transition”, September conference, The International Insurance Society, Singapore. 3. D. Venkoba Rao(2006), “Internet Impact on Insurance Distribution”, The Icfai Journal of Services Marketing, Vol. IV, No. 4 4. www.thefinancialexpress.com