Presentation on theme: "Marketing of PLI/RPLI To sell the PLI/RPLI we should know about our products. You have studied the PLI/RPLI reading material, We shall do an activity."— Presentation transcript:
1Marketing of PLI/RPLITo sell the PLI/RPLI we should know about our products.You have studied the PLI/RPLI reading material,We shall do an activity on PLI/RPLI.The object of the activity is to reinforce our knowledge about PLI/RPLI.Each one should ask one question on above topic to class and get the answer from them.
2HOW TO SELL THE PLI/RPLI Let us understand the features and benefits of PLI/RPLI through the quiz.
3SWOT Knowledge about products makes easy to market the products. For more effective marketing we need to do “SWOT Analysis”S – STRENGTHSW – WEAKNESSESO- OPPORTUNITIEST THREATS
5STRENGTHS Low rate of premium High rate of bonus More beneficial Sponsored by Central Government.Goodwill of the productsWide network in Rural AreaNew Technology
6WEAKNESSES Lack of marketing skill Lack of product knowledge Lack of planningLack of knowledge about competitorsLack of knowledge about insurance sector
7WEAKNESSES . Limited customers. Barrier of maximum limit. Lack of awareness about the products.Poor after sale service.
8OPPORTUNITIESAmong top insurance markets- India is ranked 10th among 156 countries in the life insurance business with share of 2.3 percent during FY 12.Life Insurance Premium Market expanded at a CAGR OF 20.1 per cent from USD 11.5 billion in FY 03 to USD 59.9 billion in FY 12.Source from IRDA,McKinsey
9OPPORTUNITIESThe annual income growth rate in rural area expected to increase to 3.6 percent over from 2.8 per cent duringAbout 5 million people currently have microinsurance,while the entire market is expected to be in the range of million.Increase in FDI limit to 49 percent from 26 percent as proposed in 2012,will further fuel investments.Source from IRDA,McKinsey
10OPPORTUNITIESGrowing interest in insurance among the people the insurance market size USD 72 billion FYE 12 to USD 139 billion in FYE 15.The total premium collected for life insurance in India was Rs 2.87 lakh crore during( IRDA annual report )Whereas Total premium collection in PLI was crores and in RPLI was crores only during the same periodOur total collection of premium of crore was only 2.18 % of total premium collection India duringSource from IRDA,McKinsey
11Low penetration of PLI and RPLI in respective customer segments Penetration in PLI (number of policies as % of total PSU employees)Target market size for PLITotal Number of Employees: 2.86 croreSource: India Stat, India Post MIS reports on customer category wise dataTarget market size and Penetration in RPLI (number of policies as % of rural population)Total Rural Population: ~80 croresSource: Provisional Census 2011, India Post MIS reports on RPLI state wise data
12While RPLI has seen significant growth in the past few years, it covers <3% of India’s rural populationBusiness growth in RPLIRPLI penetration in different statesCAGR 21%Channel wise contribution to number of policies sold in FY 12 ( in %)* Others includes Anganwadi workers, mail guard, ex life advisors, direct agents, ex servicemen, retired teachers, ASPO’S, IM’S
13THREATS Different types of attractive policies are not available. NO Salary deduction facility.Number of competitors are increasing.
15SIMPLE STEP FOR SUCCESS HOW TO TAP PLI/RPLI BUSINESS.PLANNING.Analyzing the Target.
16PLANNINGTo understand the market demand for our products we need to understand “THREE Ps”P1=Population PatternThe customer who are buying and where they are located.P2= Purchasing PowerAbility to purchase. This is based on income.P3=purchasing Pattern or buying behaviour.This is influenced by the life style , attitudes and sociological factors.
17PLANNING Step 1: Prospecting :- Find the prospective customers, the customer who can buy and where they are located.List all Central and State government, aided institutions, banks, Railway, Telecom. Identify eligible customers in these institutions.
18PLANNING Step 2: Qualifying Customer assesses whether PLI meets his needssalesman to show professionalism – Offer the product to meet the needs of customersDevelop skill to discover customers true needs.Customer to evaluate our solution in depthConvince the decision maker to purchase
19PLANNING Step 3: Overcoming Objections To handle objections the sales person has to haveA positive approach,Ask the buyer to clarify the objection,Question the buyer in such a way that the buyer has an answer to his own objection,or turns the objection into the reason for buying….
20PLANNING Step 4: Closing the sales There are hundreds of closing techniques, and tricks, but the most important thing to remember is that closing a sale is not a stand-alone event but just a step in a process or starting of a relationship with the organisation.
21PLANNING Step 5: Repeat business Salesman has to focus on building a long-term, profitable business relationship .S/he has to take ownership and follow up with the customer.The Satisfied customers are more likely to buy new policies,They may be willing to act as referrals for new customers.
22Analyzing Target Analyze the Target given properly For example if allotted target is 1 crore sum assured in PLIHow to reach this Target?1 crore divided by 12 months = 8,34,000 .To get 8,34,000 minimum of atleast 5 prospective customers are required every month.easily you can find prospective customers through your customer data base.
23Postal Life InsuranceGlobal Insurance for the year 2011 was USD 4,597 billion ( 6% increase over 2010)Indian Life Insurance industry mobilized a first year premium of Rs.2.87 lakh crore in The market share of private players reduced from 31.3% to 28.6%.Market : Around 62.3% of the eligible clientele currently do not hold a PLI Policy but instead have a LIC/other vendors in market.Source : IMRB Survey
24Competition scenario There were only 4 private players in 2001. Number has increased to 23 in 2012.Of the 23 private players, 21 are in joint venture with foreign partners.LIC is the only public sector company apart from India Post in the Life Insurance business. These are the two players have been in the business for the longest period of time.Source : IMRB Survey
28Market SharePLI has a market share of 21% among the addressable in the market.LIC has a market share of 66% andAll other private players together have a market share of 13%.Source : IMRB Survey
29Type of policies Indiapost customer hold Source : IMRB Survey
301.Agent /GDS/India Post Employees Non known to them Three main reasons indicated for not buying a policy among non-PLI policy holders1.Agent /GDS/India Post EmployeesNon known to them2.Products not suited for them3.PO is not located close to the residence/OfficeSource : IMRB Survey
31Hope20% of existing Customers and 27% non- Postal Life Insurance customers indicated willingness to consider Post Life insurance in the future.Among non-PLI policy holders key reason for willingness to buy PLI policy aresafety of money andAssociation of India Post ( ie Central Govt )Source : IMRB Survey
32Planning and Analyzing Planning and Analyzing Targets play important key Role.Let us study the data collected from the Mysore Division as part of the project preparation by PA Induction trainees.
33CATEGORY WISE BUSINESS PROCURED IN MYSORE DIVISION 2009-2010 Type ofPolicyNo.of ProposalsTotal Sum Assured (lakhs)Premia CollectedAEA2644.7027459CWLA0513.504543EA668629732WLA015.001475YS4384.5045119
34CATEGORY WISE BUSINESS PROCURED IN MYSORE DIVISION 2010-2011 Type of PolicyNo. of ProposalsTotal Sum Assured (lakhs)Premia CollectedAEA2450.5031689CWLA0311.002285EA856844965WLA2.50668YS2960.2031207
35Category wise business procured in mysore division 2011-2012 Type of PolicyNo. of PoliciesTotal Sum Assured (lakhs)Premia CollectedAEA3154.8034269CWLA0311.003345EA1526WLA022.30745YS41105.5053688
36THE CONSOLIDATED STUDY OF CATEGORY WISE REPORT In all the three years under study, Mysore Division has procured maximum policies under Endowment Assurance onlyWhole Life Assurance even though is more beneficial in terms of high bonus & low premium, the business procured under this catogory was very less.In Yugal Suraksha, risk of both lives covered to the extent of sum assured with accrued bonus with a single premium.Though the scheme has additional features, the business procured was comparatively very low.Not even single children policy was procured for the last three financial years.
37AnalysisIf the division would have analysed their existing policy composition, they would have tried to market other type policies to the existing customers itselfDiscuss with the available data regarding other options for better marketing strategy of PLI/RPLI
38Consolidated report on PLI business procured from various departments CategoryNo. of PoliciesSum Assured(Lacs)Banks1424.5041.001023.00CC133326.30105209.80162229.10CS301542.30421970.50950P226284.60311373.60380403.30R0822.502152.800922.00T13.0021.50---UC41.501751.0089176.50US3982.0035.200307.00CC: Central, CS: State, P: Postal, R: Railway, T: Telecom, UC: Under Central, US: Under State
39ANALYSISMysore Division has more opportunities for procuring the business through various departments.The business was concentrated more on Postal and State Government Employees only.As per the data the number of policies procured from Banks, Railways, Telecom is comparatively very low.
41Location based marketing initiatives for PLI 1Marketing in townshipsCentral and state PSUs have setup townships with necessary facilities such as housing, schools, shopping complex, banks, hospital, playgrounds, club houses etc.Residents of such large townships spend most of their time within township and have limited interaction with outside areasPLI can carry out focused marketing campaigns in such townships to effectively reach out to large number of government employees2Marketing at training centersTraining centers of PSUs, nationalized banks, police, railway, post and armed forces provide induction training to new employees as well as refresher courses to existing employees on a regular basisPLI can conduct awareness and publicity campaigns at these institutes especially to target new joining employees3Marketing at office clustersMetro and urban areas have central business districts with clusters of Government and PSU offices. Examples include Churchgate in Mumbai, Dalhousie in Kolkata, Chanakyapuri in Delhi etc.Marketing Executive should conduct marketing activities in such areas to improve brand awareness and visibility to government employees working in such office clusters
42Marketing initiatives for RPLI 1Marketing in villagesIn rural areas, people spend their time at locations such as tea shop, primary health centers, gram panchayat, village choupals and post officesRPLI should tailor its marketing initiatives (e.g. pamphlet distribution at tea shops, awareness campaign at village choupals) to target people residing in rural areas2Marketing at yatras and MelasYatras and Melas in rural India provide a great opportunity for marketing RPLI as people congregate in large numbers from nearby as well as far flung villagesLarge scale marketing campaigns at these Yatras and Melas would provide with better visibility and increase brand awareness of RPLI among rural population3Marketing through industry initiativesCorporates (ITC e-choupal, Tata Group’ Kisaan Kendras, DCM Sriram’s Hariyali Bazaar) have established a strong presence in villages by providing products and services such as agricultural advisory, retail stores, financial services and public welfareLeveraging these institutions would allow RPLI to leverage trust and infrastructure built by these institutions in rural areas4Marketing through Co-operative societiesLocal level co-operative societies fulfill the financial services requirements of farmers. Primary agricultural credit societies are important channel in providing short term and medium term credit to farmers. Apart from PACS, co- operative societies have been formed to fulfill farmer needs such as buying fertilizers, selling agri/dairy outputs etc.RPLI can target rural populace in particular farmer community by marketing through co-operative societiesYatras, choupals, NeGP5Government initiatives such as NeGP and MGNREGA have been launched to provide social infrastructure and employment in rural areasThese are typically managed and monitored by the educated people in the village. RPLI should target these initiatives to market RPLI productsMarketing through government development programs6Marketing through NGOs, SHGs and MFIsNGOs, SHGs and MFIs have strong connection with communities staying in rural areas. This can be used as nodal agencies to issue group policies to community members
43“ENJOY THE SELLING AND HIT THE TARGET” MarketingPlanning and adopting the different Marketing Strategies make success in reaching the new height in selling the products.“ENJOY THE SELLING AND HIT THE TARGET”
44Incentive for PLI Development Officer: Sl Amount of sum assured Departmental Officials viz ASPOs/IPs/PAs/SAs/SPM/Postman/Mailguard/Gp D/GDS BPM/GDS DA/GDS MC etcSlAmount of sum assuredIncentive payablei.Up to Rs 9 Crores of sum assured.Nil.ii.Above Rs 9 crores and up to Rs 11 crores of sum assured.Rs 25/- per Rs ten thousands of sum assured.iii.Above Rs 11 crores of sum assured.Rs 20/- per Rs ten thousands of sum assured.SlAmount of sum assuredIncentive payablei.Up to Rs 2 crores of sum assured.Rs 25/- per Rs ten thousands of sum assured.ii.Above Rs 2 crores of sum assured.Rs 20/- per Rs ten thousands of sum assured.
45Incentive for RPLIASP, IP/SDI, Postmen/PA/SA/Mail Guard, F.O (retirees), D.O. (PLI) , GDS etc and other RPLI Sales Force :10% of First year premium towards the RPLI policies procured by them with effect from10% of total procurement incentive paid to GDS to SDI/ASP - in first year only.2.5% of renewal premium income in respect of those policies procured on or after1% of renewal incentive payable to GDS employees towards the policies procured beforeAdditional Commission of 1.5% of premium shall be paid to the Group Leaders /entrustees for collecting premium towards 1000 or more such RPLI policies procured on or after
46ActivityBased on the above information and on the assumption that the policy were procured for 30 year old, work out average incentive earned by each of these officials
47Benefit to the official Incentive earned by few category of officials for the financial year is as underSlNameBusiness procured in croresCircleIncentive earned01R Venkadesan (D.O.)132.75Tamilnadu24,85,000/-02C Krishnamurthy (D.O.)57.61--do--9,20,000/-03V Lakshmi Narain (D.O.)49.998,29,800/-04Raj Kumar Thakur (GDS)15.41Jharkhand3,18,200/-05G Satyanarayan Reddy (GDS)4.73Andhra Pradesh1,04,600/-06Shambhu Kumar Gupta (GDS)4.0190,200/-
48TOP PERFORMERS IN RPLI 2011-12 CategoryNameBusiness procured (crores)CircleDepartmental OfficialsSanthosh Kumar Jha13.70MHS B Bhandari13.24S S Joshi10.24GDSBipin Bihari Patnaik50.5OrissaGolak ch Jena31.3Sangam Keshari Mahapatra27.40
49Revenue to the Department from PLI FRR is the fixed rate of return PLI dte pays to the dept for PLI realted activities. This is component of the revenue of the department.YEARFRR (Rs. in Cr.)(Actuals)200.46(Actuals)194.96(Actuals)297.83(Actuals)381.60(Actuals)389.62(Actuals)598.22(SY-I)532.99(Estimates)571.69(Projections)697.66(Projections)767.93(Projections)844.17
50Group activityMake team of six members and list out marketing strategy for procuring PLI or RPLIAnother team to make a shopping list for the items on which they are going to spend the incentive earned from PLI if they secure the first position for PLI marketing in the countryAmount of premia cllectionIncentive earnedShopping list