Marketing –PLI/RPLI

What is Insurance ? Insurance is a contract between two parties whereby one party called the insurer undertakes in exchange for a fixed sum called premium to pay to the other party called insured a fixed amount of money on the happening of a certain event

Why Life Insurance? Social security is a big challenge for human beings. Life today is uncertain. To secure our future we have to think of financial security. We have many options available in the market to invest money but life insurance is the most profitable amongst these.(Why?)

Need for marketing PLI/RPLI To achieve the vision of India Post To improve our market share To achieve the desired goals To establish as the market leader Economic Compulsions

Benefits of Postal Life Insurance Life Insurance has triple benefits. Insurance (Covers life risk) Investment (Gives you good return) Income Tax (You get tax rebate) Lower the age higher the benefits. So one must get insured as early as possible.

Postal Life insurance as a service Typical characteristics of Life Insurance Customer Relations spread over a long duration The performance of the service is assessed till the policy matures and the claim is allowed The after sales service is crucial and the sales personnel will act as a link between the policy holder and the organization. Delay irritates the customers

Strategy Create a true marketing plan Create a bio sheet Identify the customers Establish and understand your market area Make yourself referable Be active

Pick up the phone Be creative Plan to prospect Be persistent Have a follow up sequence

Professional Selling Of PLI The marketing executive should have full understanding and thorough knowledge of the product. He should be a keen market watcher and must be aware of the insurance business. Full knowledge about competitor’s products Knowledge of other similar products is also essential . He should be a good ambassador of the Department

Continued… Must have a professional approach to selling Must have the right sales attitude and confidence to convert the NO to YES Develop the ability to ask questions Listen carefully and answer to the queries Link features to the benefits of the customer

SWOT- Insurance Group Activity on SWOT Analysis of PLI/RPLI

Strengths Low rate of premium High rate of bonus Guaranteed by Government of India. Loan facility from any financial institution Wide coverage RPLI-Exclusively for people in rural areas Latest technology being adapted through FSI-Mccamish

Weaknesses Lack of marketing skill Inadequate product knowledge Improper planning Lack of knowledge about competitors and insurance sector Limited clientele Poor after sale service Maximum sum assured limit is 20 lakh-PLI & 5 lakh -RPLI

Opportunities Among 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. Penetration - Sources-IRDA,McKinsey,Delloit Repor t

Opportunities The annual income growth rate in rural area expected to increase to 3.6 percent over 2010-30 from 2.8 per cent during 1990-2010. About 5 million people currently have microinsurance,while the entire market is expected to be in the range of 140-130 million. Increase in FDI limit to 49 percent from 26 percent as proposed in 2012,will further fuel investments. Source from IRDA,McKinsey

Opportunities Growing interest in insurance among the people the insurance market size USD 72 billion FYE 12 to USD 139 billion in FYE 15. Source from IRDA,McKinsey

Threats Changing expectations of the customer Stiff competition from other insurance providers

Incentive-PLI/RPLI PLI Incentive For officials other than Development Officers Incentive amount is Rs 25 per Rs. Ten thousand of sum assured upto Rs. 2 crores of sum assured and Rs. 20/- per Rs. 10000 sum assured beyon Rs. 2 crores For Development Officers Sum Assured Incentive Up to 9 crores No Incentive Above 9 crores up to 11 crores Rs 250 per lakh of sum assured Above 11 crores Rs 200 per lakh of sum assured

Incentive-PLI/RPLI RPLI Incentive Incentive against RPLI business procured is to be paid monthly by the divisional head @ 10 % of the first year premium income @ 2.5 % of subsequent years premium income for policies procured after 1.10.2009 @ 1% of subsequent years premium income for policies procured before 1.10.2009

Need for a marketing strategy Low penetration of PLI/RPLI in the respective customer segments The next slide indicates the penetration level of PLI/RPLI

Low penetration of PLI and RPLI in respective customer segments demands a focussed marketing strategy Penetration in PLI (number of policies as % of total PSU employees) Target market size for PLI Total Number of Employees: 2.86 crore Source: India Stat, India Post MIS reports on customer category wise data Target market size and Penetration in RPLI (number of policies as % of rural population) Total Rural Population: ~80 crores Source: Provisional Census 2011, India Post MIS reports on RPLI state wise data

Comparison of premium collections Premium collection in DOP in 2012-13 PLI premium Rs. 4557.29 crores RPLI premium Rs. 1703.16 crores Total Rs. 6260.45 crores Premium collection by LIC in 2012- 13 was Rs.2.87 lakh crores Look at where we stand and the gap we need to fill to improve our market share!!!

A structured framework would assist PLI and RPLI in developing a focussed marketing strategy Marketing Framework 1 Marketing Organization Govern Reach out to prospective and current customers Communicate the message to customers Monitor the performance to make suitable changes Conversion into sales 2 3 4 5 Marketing initiative Marketing communication Sales integration Feedback and monitoring Provide Support 6 Tools and Technologies 7 Brand management

Following key strategic initiatives have been identified for PLI and RPLI based on ‘As-is’ assessment 1 Establish a dedicated marketing team to plan, implement and administer marketing initiatives 2 Develop tailored marketing initiatives to reach out to prospective PLI and RPLI customers 3 Develop a Tailored marketing strategy and initiatives to increase penetration of PLI in Army Postal Services Develop orchestrated communication plan to create awareness about life insurance, publicize PLI and RPLI offerings and stimulate sales 4 5 Develop tailored marketing initiatives and communication plan for targeting migrant population 6 Align sales channels with PLI and RPLI customer segments for pre-sales and sales conversion 7 Integrate marketing activities with call center for lead generation and lead servicing 8 Develop effective mechanism to monitor marketing initiatives and gather feedback from marketing staff and channel staff to modify marketing initiatives 9 Leverage customer relationship management (CRM) system to develop targeted marketing initiatives 10 Strengthen PLI and RPLI brands by establishing a brand identity, communicating brand promise and ensuring brand delivery

PLI specific marketing initiatives and communication strategy

Developed location based marketing initiatives to reach out to prospective PLI customers 2

Summary of location based marketing initiatives 1 Marketing in townships Central 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 areas PLI can carry out focused marketing campaigns in such townships to effectively reach out to large number of government employees 2 Marketing at training centers Training 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 basis PLI can conduct awareness and publicity campaigns at these institutes especially to target new joining employees 3 Marketing at office clusters Metro 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. PLI should conduct marketing activities in such areas to improve brand awareness and visibility to government employees working in such office clusters

Usage of various marketing mediums in location based marketing initiatives TV marketing Outdoor marketing Print marketing Internet marketing Mobile marketing Marketing in townships Marketing at training centers Marketing at office clusters                Outdoor marketing includes marketing using posters, banners, hoardings and kiosks Print marketing includes marketing using leaflets, pamphlets, brochures and newspapers Internet marketing includes marketing using emails, web banners, social media marketing and marketing on internal websites

Some of the largest townships in India 1. Marketing in townships Central PSUs have set-up large scale townships in various parts of India Central PSUs have set-up large scale townships across India for its employees. The townships usually are established by PSU organization with plant operations in far flung areas These townships are build near a plant and are self-sufficient with facilities such as residential units, hospitals, recreation areas, shops, schools, banks and post office. Some of them also have higher education institutes and cinema halls Some of the biggest townships in India Include Bhilai, Bokaro, Rourkela, Durgapur, Bailadila and Neyveli. A few of these township are built jointly by multiple PSUs Some of the largest townships in India Name of township Number of employees SAIL Bhilai township ~37,000 SAIL Bokaro township ~30,000 SAIL Rourkela township 50,000-55,000 SAIL Durgapur ~20,000-22,000 NMDC – Bacheli and Baila Dila townships ~12,000 Bokaro Durgapur Rourkela Bhilai Key observations Township residents are highly influenced by peer level marketing Currently, insurance policies are being sold by individual agents of other insurance companies residing in these townships Currently, PLI undertakes limited marketing activities in these townships Bachili-Bailadila Neyveli Source: Company websites, secondary research

1. Marketing in townships Residents of large PSU townships spend most of the time in the township Office & Plant Area Visit daily/weekly for social gatherings and fitness activities Spend 50 hrs. per week at office Access intranet and emails Interact with other employees at canteens School Club House Elevator Computer Visit everyday/alternate day to buy everyday goods Canteen Playground Spend 5-10 minutes per day for wait time and security check Shopping Complex Plant Entrance Visit once in a week to withdrawals, deposits and to keep track of accounts Bank 25-30 hours a week spent with family and neighbors Visit once in 1-2 weeks for postal services and postal savings bank Visit once in 2-3 months for medical checkup or illness Residential Post Office Hospital PSU employees residing in townships spend most of their time within the township. Typically, the township community members have a high degree of interaction among themselves and depend each other for advise on financial products The most common places visited by employees and their families are shown above. Post office is just one of the visited places by the customer to avail a variety of postal services Currently post office works in isolation and undertakes limited marketing initiatives in the township areas for PLI products Note: based on interaction with residents of large PSU townships

1. Marketing in townships Post office can undertake a 360 degree marketing approach in PSU townships to ensure extensive coverage Organize painting or essay competitions for children Office & Plant Area Internet based marketing Posters inside elevators and on canteen tables keep posters and hoardings School Elevator Playground Computer PLI awareness posters Canteen Club House Banners at entrance gates Post Office Plant Entrance Poster and banner marketing and kiosk marketing at shopping complexes Shopping Complex Health and wellness awareness posters at hospital Hospital Bank Kiosks marketing at banks Residential Newspaper/pamphlet based marketing, TV marketing for residential complexes A 360 degree marketing approach would involve engaging in marketing initiatives to target township residents at frequently visited locations using variety of marketing mediums such as print marketing, TV marketing, poster marketing, kiosk marketing and email marketing A similar approach can be undertaken for smaller colonies (e.g. colonies in metro areas which have only residential units) to market PLI products

Description of select marketing initiatives in townships 1. Marketing in townships Description of select marketing initiatives in townships TV marketing Advertisements in local cable channels for PSU staff colonies PSU townships/colonies avail TV channel services from local cable services operators These cable services operators also provide local channels covering local news, local events and showcasing recently released movies Evening news and movies are popular among staff and their families residing in the townships/colonies Advertisements can be put up on local channels during popular programs to market PLI products Outdoor marketing Posters, banner and hoardings at public places Put posters, hoardings, banners at public locations: PSU offices – near security gates and near lifts where people wait for longer time Staff canteens and messes in offices Public places within PSU townships/colonies such as playground, clubs and hospitals Stalls/kiosks Put stalls/kiosks at following locations: Locations which are frequented within staff townships/colonies such as shopping complexes so that people can be targeted individually as well as in groups Staff canteens in offices Print marketing Distribution in residential units Circulate pamphlets, brochures, life insurance guides in staff colonies to create awareness about insurance and market PLI products Pamphlets/leaflets/brochures can be sent with postmen visiting houses for postal delivery

Training at Indian Railway Details of training centers 2. Marketing at training centers 2 3 4 5 T 6 7 1 PSUs have set up training institutes to provide training to its new as well as existing employees All major PSU organizations have training centers scattered all over India to provide induction to new recruits as well as refresher courses to existing employees Details of training centers if Indian Railways is provided below: Training at Indian Railway Details of training centers Indian Railways carries out massive training exercises for its ~14 Lakh employees It has around 291 training centers located across India which provide specialized training to its employees It has a total capacity to provide refresher training to nearly 4.5 Lakh employees every year Every year, ~1 Lakh employees (~7% of the total workforce) are provided with refresher training in addition to induction to new recruits The training provided consists of classroom training, technical as well as railway working rules, on-job training and independent working training in come cases Training center type Number Details Grade A training centers 6 Specilized engineering and general training to Grade A employees Main training centers 56 Supervisor, electrical, civil, welding and technical training Other training centers 235 Accounts training, basic and permanent way training, transportation and traffic training, diesel traction training, RPF training Marketing approach Most of the training programs are resident training programs that last for 3 days – 7 days. Training centers are well equipped with all kind of facilities such as classrooms, technical labs, computer labs, library, hostels, playgrounds, gym / yoga rooms etc. Typically, these training centers are categorized as per the cadres of the employees to whom training is provided (e.g. Group A employees training center, Supervisor training center etc.) Employees assembled in large numbers provides opportunity to market PLI products to a focussed group. Further, marketing initiatives at each of the training center can be tailored as per the profile of the employees (Group A, Group B, Group C, Group D) Source: Secondary Research

2. Marketing at training centers PLI can target training centers with various marketing initiatives to educate PSU employees about PLI offerings Distribute PLI pamphlets Organize talks to create life insurance awareness and market PLI products Showcase PLI films between the lectures Distribute PLI pamphlets in hostel rooms Central office Hostels Classroom Put banners at playgrounds Distribute pamphlets and leaflets Mess Post Office Grounds Distribute health and wellness awareness leaflets Gym and Yoga Center Computer Lab Distribute pamphlets and leaflets Library Distribute pamphlets Put PLI brochures with elaborate information Marketing mediums can be tailored depending upon location and level of interaction. One of the best ways to market PLI products would be to showcase small 4-5 minute films between the classes or conduct a short guest lecture Marketing at training centers could be an effective way to educate government sector employees about PLI offerings; Sales may not take place at training centers considering most of the employees would be residing at locations elsewhere in the country

3. Marketing at office clusters 2 3 4 5 T 6 7 1 Government offices in the metro/urban locations is an attractive catchment area for PLI to market its products Sample case study: South Mumbai central business district Government offices State PWD Bus Stops Reserve Bank of India Major roads High Court Typically urban areas have one or more central business districts with cluster of government offices PLI can undertake several marketing initiatives such as Put posters and banners on bus stops, railway stations and major roads Put customized posters (e.g. ‘Insurance for employees of Reserve Bank of India’) within organization premises Distribute pamphlets and brochures within the organizations Put stalls/kiosks in front of the entrance or within the premises of the offices Deploy marketing managers to go and meet senior officials of respective organizations for group sales Organize events such as ‘marathon competition for government employees’ Mumbai University New Admin building Inst. Of sciences New India Insurance Maharashtra Police Mukhyalaya

Develop orchestred communication plan to create awareness about life insurance, publicize PLI and RPLI offerings and stimulate sales 4

Communication plan should be tailored depending upon the customer segment that marketing initiative wishes to target Segment type Description Grade Pay* % of total employees* Financial awareness Communication plan Group A / 1 People from UPSC, professors, engineers, doctors, magistrate Rs. 10,000 & above ~3% Aware of banking and insurance products Knowledgeable about life insurance offerings of other life insurance companies Focus on relationship management and sales stimulation Sales personnel should have thorough knowledge of insurance products Group B / 2 Block officer, section officer, superintendents, inspectors, teachers, income tax officer, junior engineer Rs. 5400 to 8900 ~8% Brand awareness about LIC and some of the other life insurance companies Focus on communicating benefits of PLI Focus on differentiating PLI from other insurance companies Group C / 3 Clerk, assistant, typist, tax assistants, telephone operator, workers Rs. 1900 to 4800 ~60% Aware of banking products Limited awareness about life insurance Brand awareness about LIC Focus on creating awareness of insurance Differentiate PLI from LIC Marketing communication to stimulate word-of-mouth publicity about RPLI Group D / 4 Peon, attender, gardener, driver Upto Rs. 1800 ~29% Little awareness of banking and no awareness of insurance products Have small savings in banks Marketing initiative to stimulate word-of-mouth publicity about RPLI *Note: Grade Pay and Percentages are only for central government employees Source: Census of Central Government Employees data, June 2011

Communication plan must include product proposition to respective customer segments Segment Type Product positioning Participatory Annuity Term Group products Riders Group A / 1 Have ability to understand complex products Recognize need for savings as well as protection Should be communicated all the offerings to support broader financial planning goals Group B / 2 Aware about basic life insurance products (such as whole life products) Understand the need for savings and protection cover Group C / 3 Lower income; Family is more vulnerable in case of death of employee In case of workers, possibility of accidents at worksites results in higher risk Low premium (~Rs. 60-80 per month for 10 lakh cover) term products with riders most suitable Should be communicated affordability of products (e.g. Rs. 70 a month for 10 lakh cover) with adequacy of protection Group D / 4 Low premium (~Rs. 60-80 for 10 lakh cover) term products with riders most suitable                  Indicates most suitable. Other products can also be sold

Communication plan for marketing PLI products (1/3) 2 3 4 5 T 6 7 1 Communication plan for marketing PLI products (1/3) Increase awareness about insurance need Publicize PLI products and services Stimulate sales TV marketing Advertisements in local cable channels for PSU staff colonies May not be effective to increase awareness about life insurance Insert running banner advertisements during the movies and popular programs on the local cable channels Put advertisements in local languages Insert satisfied customer’s videos from local community Provide contact details (local post office number, toll free number, website details) Outdoor marketing Only provide information on benefits on insurance not specific to PLI. Ensure PLI logo and tagline Product specific posters (e.g. children policy, group policy) to educate customers Focus on service (e.g. policy within 7 days) Details of toll free number and website should be provided Details of promotional campaigns such as referral programs, loyalty programs Posters, Banners and Hoardings Stalls and kiosks Only provide information on benefits on insurance not specific to PLI. Ensure PLI logo and tagline Understand customer requirements and provide tailored information about PLI products Obtain name and contact details for lead generation Provide information on who else from the organization has bought the policy

Communication plan for marketing PLI products (2/3) Increase awareness about insurance need Publicize PLI products and services Stimulate sales May not be effective to increase awareness about life insurance PLI products overview and benefits overview Focus on service (e.g. policy within 7 days) Catchy headlines to grab attention Details of toll free number, agent contact and website should be provided Details of promotional campaigns such as referral programs, loyalty programs should be described Print marketing Advertisements in internal magazines Distribution of pamphlets in colonies/canteens Only provide information on benefits on insurance not specific to PLI. Ensure PLI logo and tagline Brief description of PLI, schemes, investments, benefits, terms & conditions, scenario explanations, frequently asked questions could be included Internet marketing Internet Marketing Provide informative content about insurance on website Premium calculator on website Post videos on website /intranet to educate PSU employees about insurance products Send e-brochures covering benefits and need of insurance Send product brochures through emails Insert PLI banners on website intranets Send update emails (introduction of new products such as group insurance) through emails Provide toll free number details Provide contact number of nearest post office through emails Provide links for policy registration to generate leads

Communication plan for marketing PLI products (3/3) Increase awareness about insurance need Publicize PLI products and services Stimulate sales Mobile Marketing May not be effective in creating awareness about life insurance Develop ringtones/jingles to create awareness about PLI Send PLI promotional SMS directly to customer mobile numbers Provide toll free number through SMS Provide message such as ‘SMS xx to a specified number’ to generate instant response Provide information such as ‘e.g. 10 people in your organization have bought PLI policies’ to stimulate sales Mobile marketing

Activity Trainees to be grouped in to as many groups as possible on the following lines Trainees from same division/region in one group If sufficient trainees are not available from the same division/region, trainees from the same circle to be grouped together

Continued The trainees to brain storm and identify the target group for PLI . If possible trainees to identify the organisation/township within their division/region Based on the above the communication plan for each group has to be prepared

RPLI rural customers specific marketing initiatives and communication strategy

Developed tailored marketing initiatives to reach out to prospective RPLI customers 2

While RPLI has seen significant growth in the past few years, it covers <3% of India’s rural population Business growth in RPLI RPLI penetration in different states CAGR 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

Summary of marketing initiatives 1 Marketing in villages In rural areas, people spend their time at locations such as tea shop, primary health centers, gram panchayat, village choupals and post offices RPLI should tailor its marketing initiatives (e.g. pamphlet distribution at tea shops, awareness campaign at village choupals) to target people residing in rural areas 2 Marketing at yatras and Melas Yatras 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 villages Large scale marketing campaigns at these Yatras and Melas would provide with better visibility and increase brand awareness of RPLI among rural population 3 Marketing through industry initiatives Corporates (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 welfare Leveraging these institutions would allow RPLI to leverage trust and infrastructure built by these institutions in rural areas 4 Marketing through Co-operative societies Local 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 societies 5 Government initiatives such as NeGP and MGNREGA have been launched to provide social infrastructure and employment in rural areas These are typically managed and monitored by the educated people in the village. RPLI should target these initiatives to market RPLI products Marketing through government development programs 6 Marketing through NGOs, SHGs and MFIs NGOs, 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

Usage of marketing mediums in marketing initiatives TV Radio Outdoor –posters and banners Outdoor – stalls, kiosks, talks and street plays Print – newspapers Print – pamphlets and brochures Mobile marketing Marketing in villages Marketing at yatras and melas Marketing through industry initiatives (e-choupals, HKBs etc.) Marketing through Co-operative societies Marketing through govt. development programs (MGNREGA. NeGP etc.) Marketing through NGOs, SHGs and MFIs                                          

Primary Healthcare Center 1. Marketing in villages RPLI would be required to tailor marketing initiatives suited to rural ecosystem…. Long free time while waiting for bus Rural houses Mobile has reached every third rural household* Rural people listen to radio in their leisure time Television are also present in household with higher income Bus Stand Respected people of the village visit here every day Gram Panchayat House Television Visit during illness with average visit time of 1 hour School Primary Healthcare Center Radio Mobile People visit weekly bazaars to buy grocery Visit regularly for savings, postal, remittance needs Bazaar Branch Office Daily visit tea shop to socialize with other villagers Temple Tea Shop Rural areas are characterized by dispersed population, low penetration of technology and low awareness about financial services in particular insurance Currently, branch post office undertakes limited marketing activities for RPLI. Some of the existing marketing initiatives by RPLI include conducting rural melas, putting wall paintings and putting posters near post office *Source: TRAI press release. Data as on 31st January 2013

… to effectively market itself to rural populace 1. Marketing in villages … to effectively market itself to rural populace Rural houses Wall painting for RPLI Posters and banners at bus stands SMS based marketing in regional languages House Wall Paint Television Bus Stand Publicize RPLI products over local radio stations PLI awareness posters and camps Mobile Gram Panchayat RPLI advertisements on TV Health and wellness awareness posters Branch Office Radio PHC Painting and essay competitions in rural government schools Pamphlets at tea shops to explaining RPLI products School Tea Shop Temple Bazaar Kiosks at weekly bazaar for insurance literacy Marketing at locations such as local taparis (tea shops), weekly bazaars, bus stands, primary healthcare centers would be extremely effective since marketing at such places encourages discussion among villagers Key points to make rural marketing effective is marketing in local language and use of local influencers (doctors, teachers, credit society members etc.) to create awareness among villagers

Marketing Initiatives 1. Marketing in villages 2 3 4 5 T 6 7 1 RPLI should selectively undertake marketing initiatives depending upon population of the village Village type Micro Villages Small Village Mid-sized village Big villages Population range <500 500-1,000 1,000-5,000 >5,000 Number of villages* 219,063 145,402 210,390 18,760 Marketing Initiatives PLI awareness camps at Gram panchayat Health posters at PHC SMS in regional language Pamphlet at tea shop Posters at bus stop Wall painting at visible locations Competitions at schools Kiosks at bazaar Radio TV                                         *Data based on census of 2001

1. Marketing in villages 2 3 4 5 T 6 7 1 Description of select village level marketing initiatives for RPLI (1/2) Radio marketing Partnering with rural community radio stations Community radio stations are gaining momentum in rural regions. The key objective is to promote economic, social and cultural development through programs on a wide range of topics Rural radio stations are identified as trustworthy source of information among rural people Among the 120+ community radio stations in India, ~80 radio stations operate in rural India. Further, the government has announced plan to start 800+ radio stations in smaller towns in recent budget session Each community station covers villages in 5-20 km of radius thus giving a substantial coverage in rural community RPLI can partner with rural community radio stations in variety of ways to increase awareness about insurance as well as educate rural people about RPLI products TV marketing RPLI advertisements on TV RPLI advertisements can be aired on local cable channels or national channels such as Door Darshan which have higher viewership in rural areas Advertisements can be aired during the agriculture related programs to have attracted marketing Outdoor marketing Posters, banner and hoardings at public places Put posters, hoardings, banners at public locations Road-facing walls of the houses to increase visibility to rural populace Local ’Tapari’ where people visit regularly to buy day-to-day stuff Bus stands where people linger for a longer time waiting for the buses Buses, milk vans, postal vans which visit multiple villages on daily basis Weekly bazaars where villagers congregate in large numbers to buy weekly grocery Stalls/kiosks at public places Put RPLI stalls/kiosks public events Local events and weekly bazaars where villagers congregate in large numbers

1. Marketing in villages Description of select village level marketing initiatives for RPLI (2/2) Print marketing Rural newspapers Rural Dailies like ‘Khabar Lahariya’ (5,000 circulations in rural areas of Uttar Pradesh) which are read locally can be used for advertisements due to rural reach and lower advertising costs Pamphlets can be inserted in all newspapers at a distribution centers at town level so that it reaches all people in that region Pamphlets distribution ‘Tapari’ shops is the most visited place by rural populace for purchasing items such as soaps, biscuits, beedi/cigarette etc. Pamphlets and brochures can be kept at these shops for people to read and encourage discussion among each other Health and wellness awareness leaflets can be kept for distribution at primary healthcare centers Pamphlets can be distributed with postmen vising rural houses for delivery of letters Social marketing Pick a cause Organize free health check-ups in rural areas where it can market its products to customers Organize sporting event such as ‘tug of war’, ‘skipping competition’, ‘push-ups’ competition, ‘running competitions (marathon) in rural villages to attract youth Organize reading camps for children by providing books and magazines Pick a group Target working groups in unorganized sectors such as tea plantation, firecrackers factories, beedi workers, brick kiln workers and forest products Conduct informal sessions on creating insurance awareness and market RPLI products Arrange for entertainment programs such as arranging film shows interspersed with the RPLI advertisements

1. Marketing in villages Mobile marketing can be used in variety of ways to market RPLI products Type Description of initiative Direct marketing SMS marketing - sending tailored sms to customers Voice calls on mobile phones Mobile promotions Ringtones and jingles to create awareness among rural customers Promotional contests on mobile phones to win prizes Servicing through mobile SMS notification can be used for all activities e.g. premium payment reminder, status of the claim, benefits payout, dispatch of premium receipts etc. Contact customers on their mobiles for surveys on various aspects such as customer needs and customer satisfaction Provide answer to customer queries can on mobile phones

2. Marketing in yatras and melas RPLI should leverage melas and yatras to create awareness among rural populace Central mela location Shopping areas Ghat Puja Shops Aarti book Puja thali Banners and hoardings near ghats/places of congregation Kiosks with loud speakers at shopping premises RPLI advertisements of puja thalis for sale RPLI advertisements on aarti books for sale Travel Others Head Office Railway Bus Stand Boats Entertainment Medical camp Kiosks / pamphlet distribution at railway stations / bus stand Posters on boats and at bust stands/railway stations Health awareness posters at medical camp Street plays to increase awareness about insurance and RPLI Lodging and Boarding Tents Food Counters Pamphlet and leaflet distribution in strength Thalis with imprint of RPLI Kumbh melas (Ardha Kumbh, Purna Kumbh, Maha Kumbh and Simhasta melas) Kumbh melas (one of the four mentioned above) take place once in 2-3 years; Locations include Prayag, Nashik, Ujjain and Haridwar Visitors range from 80 lakh-3 crores Next melas are planned in 2015 (Nashik) and 2016 (Ujjain) Some of the other prominent annual yatras include: Ratha yatra in Orissa (5-6 lakh visitors) Amarnath yatra in Kashmir in July-August (6-8 lakh visitors) Pandharpur yatra in Maharashtra in June (5-7 lakh visitors)

3. Marketing through industry initiatives RPLI should leverage industry initiatives to influence farmer community Model Services provided Value Proposition ITC e-choupal Internet based platform providing farming related information and services to rural farmers 6,500 personals currently providing information to 4 million farmers across 40,000 villages Updates on the best prices of the commodities available in neighboring regions Information regarding weather forecast and news updates for planning agricultural activities Information on crop insurance available in their region Facilitates purchase of farming inputs Developed as farmer centric information center Benefits to farmers as e-choupal eliminates middlemen Managed by ‘ITC Sanchalaks’ who assist farmers in accessing variety of services provided by e- choupal Farmer community has a high degree of trust in services provided by e-choupal and in particular its Sanchalaks Hariyali Kisaan Bazaar (HKB) Farming products and services superstores 165 centers providing services to 15,000 farmers per center covering over 2.5- 3 million farmers in total Superstores with complete agricultural solutions which include products and advisory services Customized technical advisory services to farmers to increase farm output Distribution of products such as agri- products, customer goods, financial services, health services and Agri services Assistance in output financing, warehouse and buy-back of crops Serves as a interface between farmers and rest of the ecosystem Take initiatives to improve the quality of life by providing urban facilities like ATMs, door step service and modern retailing Farmers have trust in the advisors at HKB and rely on their advice Tata Kisaan Sansar (TKS) Farming inputs, advisory, training 600 TKS outlets provide solutions to 3.5 million farmers across 25,000 villages Agricultural inputs such as seeds, pesticides and fertilizers Agricultural advisory services like soil mapping, crop advisory, fertilizer testing Training and information through films, magazines, news letters, workshops Buy back, credit and crop insurance facility Provide end-to-end solution to farmers Provide access to knowledge about modern farming technologies GIS mapping systems are used to record, and analyze maps and census data of the districts they operate in are utilized to provide total solutions to the farmer Other similar initiative focussing on rural retail include Godrej’s Aadhar stores, IOCL’s Kisan Seva Kendras and Warna Bazaar’s co-operative’s stores

Leveraging industry initiatives – marketing strategy 3. Marketing through industry initiatives Leveraging industry initiatives – marketing strategy Stimulate sales For smaller outlets ( such as e- choupals), RPLI can pay referral commission to Sanchalaks For bigger stores such as HKB and Tata Kisaan Sanasar, RPLI can stations their SDIPs/Direct Agents on specific days for sales RPLI can also have broker tie-ups with some of these leading stores Publicize products BPM can put RPLI posters at the outlets to increase brand visibility SDIP can station an agent at large outlets (HKB outlets) and BPM at smaller outlets (e-choupals) at regular intervals (once a week/once a fortnight) to answer queries of the people interested in buying RPLI policies SDIP/BPM should educate the local outlet staff (Sanchalaks/advisors) about RPLI benefits to generate word-of-mouth publicity of RPLI Create awareness SDIP/BPM can conduct talks/workshops at outlets to educate visitors about the need for insurance Show short films to create insurance awareness ICICI Prudential has tie-up with Hariyali Insurance Broking Limited for distribution of their policies through HKB outlets: ICICI Prudential has leveraged strong brand and loyal customer bases of HKB in the regions such as Punjab, Uttar Pradesh, Haryana, Rajasthan, Uttaranchal, Andhra Pradesh and Tamilnadu

RPLI can use rural presence and influence of co-operative societies 4. Marketing through co-operative societies RPLI can use rural presence and influence of co-operative societies Rural regions have very low penetration of banks and other major financial institutions. This has lead to creation of many local level co- operative societies which 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 financing institutions, co-operative societies have been formed to fulfill farmer needs such as buying fertilizers, selling agri/dairy outputs. These include IFFCO, Sugar co-operatives and dairy co-operatives Type of co-operative society Number of cooperatives Member population Benefits to members Indian Farmers Fertilizer Co-operative (IFFCO) 48,000 5 crore Helps farmers to increase their crop productivity by proving them fertilizers Provide location specific research for efficient fertilizer practices Sugar Co-operatives 280 3 crore Technical and managerial guidance to sugar factories Advice to farmers on sugarcane agronomy and cultivation practices Dairy Co-operatives 1,20,000 1.2 crore Provides range of products and services such as animal-care services, cattle-feed products 80% dairy farmers are women Primary Agricultural Credit Societies (PACS) 93,000 12 crore Provide long, med-term and short term credit to customer 80-85% loans are for agriculture activities Have lower lending rate due to subsidy by NABARD

Leveraging co-operatives – marketing strategy 4. Marketing through co-operative societies 2 3 4 5 T 6 7 1 Leveraging co-operatives – marketing strategy Stimulate sales Recruit agents from co-operative societies to sell insurance to members of the co-operatives as well as others Publicize products Create awareness SDIP should educate governing committee of co-operative societies about benefits of RPLI to encourage word of mouth publicity Display RPLI posters in offices of the co-operative societies Put advertisements of RPLI on products provided by these institutions such as fertilizer packets / sacs SDIP can conduct talks/workshops at outlets to educate visitors about the need for insurance Show short films to create insurance awareness IRDA is in the process of finalization of the guidelines on Mircoinsurance agencies in rural areas Currently, only insurance company agents, commercial banks, microfinance institutions, non-governmental organizations and self-help groups are allowed to sell micro-insurance policies As per the latest guidelines, Regional Rural Banks, District Co-operative Banks and Primary Agricultural Credit Societies (PACS) are likely to be allowed to become micro insurance agents Also, individuals which include shopkeepers, medical store owners, petrol pump owners and public telephone operators shall be allowed are likely to be allowed to become micro insurance agents

5. Marketing through government development programs RPLI can leverage national initiative such as MGNREGA to market RPLI to non-farm labourers in rural areas Overview Value Proposition Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) was introduced by the Government to provide employment opportunities to the rural population All house holds which seeks employment approach the local Gram Rozgar Sahayak and obtain guaranteed employment within 15 days of registering It is organized in the following manner with the apex governing body overseeing its operations at that level: Village Level – Work site supervisors Village Level – Gram Rozgar Sahayak (GRS) Block Level (group of villages) – Programme Officer District Level – District Programme Coordinator State Level – State employment guarantee council National Level – Central employment guarantee council Key responsibilities of GRS include: Overseeing the registration for MGNREGA in village Work assignment and collating attendance records Updation of job cards Key responsibilities of work-site supervisors: Supervise work sites and capture attendance Help illiterate to calculate wages earned Create awareness about rights and entitlement under MGNREGA Provide first aid services to workers GRS and work-site supervisors are key influencers for MGNREGA workers The payout of wages is made by MGNREGA into the accounts of these employees which are usually the no-frills accounts opened with any bank or post office RPLI will have ready customer base with accounts existing with Postal Savings Bank These households are provided with Job cards which can be used for KYC compliance to issue policies to these customers Coverage CAGR of Households = 27%

Leveraging MGNREGA – Marketing strategy 5. Marketing through government development programs Leveraging MGNREGA – Marketing strategy Stimulate Sales For policies sold through GRS, worksite supervisors and Block officers, RPLI can pay referral commission RPLI can tie-up with MGNREGA to provide bundled offering to laborers: Provide savings accounts with term insurance cover Deduct premium at the time of disbursement from government Publicize Products SDIP should explain Block officers, GRS, worksite supervisors regarding the benefits of RPLI over other life insurers GRS and worksite supervisors should convince the laborers to be part of the group insurance policy Create Awareness BPM with assistance from SDIP should organize workshops to educate the workers about the need for protection for their family SDIP/BPM can explain the health hazards associated with their work environment and living conditions

Key customer segmentation for RPLI …. 2 3 4 5 T 6 7 1 Key customer segmentation for RPLI …. Segment type Attributes Financial Awareness and Ability Farmers – large farm Owners Own more than 5 hectares farms Hire laborers Have high income on sale of crops on annual/semi annual basis Income: >Rs. 2 Lakhs per year Aware of banking and insurance products Typically have bank accounts Have savings in the banks for agricultural related activities Sometimes take loan from local financial institutions Trade / service class / professionals Self employed and salaried population Financial services, retail, government employees Have regular monthly income Income: >Rs. 50k per year Have small savings for hard times also may have insurance Farmers – small and medium farm owners Own small size farms work on own farms Have moderate income on annual/semi-annual basis Income: Rs. 25k - 2lakh per year Aware of banking products. May have limited insurance information Have limited savings. Often depend on credit from local financial institutions for agricultural activities Farmers - laborers Work on farms of others Highly venerable due to low income and unavailability of employment during some part of the year Income: < Rs. 25k per year Not aware of banking and insurance products Do not have savings to support in hard times Construction / manufacturing laborers Daily wage based workers Work at construction sites, SME Higher risk of accidents at their work sites Income: <Rs. 50k per year Little awareness of banking products. No awareness of insurance ~2.7% of employed population ~15% of employed population ~35% of employed population ~30% of employed population ~17% of employed population Source: ICSSR report, Deloitte research

…to target its marketing initiatives 2 3 4 5 T 6 7 1 …to target its marketing initiatives Segment type Marketing in villages Marketing at yatras & melas Industry initiatives Co-operatives Government programs SHGs and MFIs Farmers – large farm Owners Trade / service class / professionals Farmers – small and medium farm owners Farmers - laborers Construction / manufacturing laborers       ~2.7% of employed population       ~15% of employed population       ~35% of employed population       ~30% of employed population       ~17% of employed population

Develop orchestred communication plan to create awareness about life insurance, publicize RPLI offerings and stimulate sales 4

Communication mediums have varying impacts on the different customer segments Group Type Marketing mediums TV Radio Outdoor –Posters and banners Outdoor – Stalls and Kiosks Print – newspapers Print – pamphlets and brochures Mobile marketing Farmers – large farm Owners Trade / service class Farmers – small and medium Farmers - laborers Construction / manufacturing High Medium Low

Product positioning needs to be communicated to customer segment in rural regions Group Type Product positioning Participatory Annuity Term Group products Riders Farmers – large farm Owners Single premium All riders Trade / service class Regular premium Farmers – small and medium farm Owners Farmers - laborers Regular premium term products Accident and disability Construction / manufacturing     ~2.7% of employed population     ~15% of employed population   ~35% of employed population    ~30% of employed population    ~17% of employed population  Indicates most suitable. Other products can also be sold

Communication plan for marketing RPLI products (1/2) 3 4 5 T 6 7 1 Communication plan for marketing RPLI products (1/2) Increase awareness about insurance need Publicize RPLI products and services Stimulate sales Radio marketing Rural radio stations Participate in educational programs to increase awareness about benefits of life insurance Collecting queries about life insurance from local people and addressing the same to broader audience through community radio Provide information about RPLI, its products and benefits through programs focussing on financial literacy Insert RPLI advertisements during the popular programs Endorsement of RPLI products by influential people in local communities Provide contact details (local post office number, toll free number) Outdoor marketing Posters, Banners and Hoardings Message should only focus on benefits of life insurance with RPLI logo and tagline alongside Product specific posters (e.g. children policy, group policy) to educate customers Focus on service (e.g. policy within 7 days) Details of toll free number website should be provided Promotional campaigns such as referral programs, loyalty programs Stalls, kiosks and local talks Only provide information on benefits on insurance not specific to RPLI Understand customer requirements and provide tailored information with RPLI products as per customer’s requirement Obtain name and contact details for lead generation

Communication plan for marketing RPLI products (2/2) 3 4 5 T 6 7 1 Communication plan for marketing RPLI products (2/2) Increase awareness about insurance need Publicize RPLI products and services Stimulate sales Print marketing Rural newspapers May not be effective to increase awareness about life insurance need RPLI products overview and benefits overview Focus on service (e.g. policy within 7 days) Catchy headlines to grab attention Details of toll free number and website should be provided Promotional campaigns such as referral programs, loyalty programs should be described Pamphlets distribution Only provide information on benefits on insurance not specific to RPLI. Ensure RPLI logo and tagline Brief description of PLI, schemes, investments, benefits, terms & conditions, scenario explanations, frequently asked questions could be included Mobile marketing Mobile Marketing May not be effective in creating awareness about life insurance Develop ringtones/jingles to create awareness about PLI and RPLI Send PLI/RPLI promotional SMS directly to customer mobile numbers Provide toll free number through SMS Provide message such as ‘SMS xx to a specified number’ to generate instant response Provide information such as ‘e.g. 10 people in your village have bought RPLI policy

RPLI migrant customers specific marketing initiatives and communication strategy

RPLI can segment migrants…. 2 3 4 5 T 6 7 1 RPLI can segment migrants…. Total migrant population in India stands at 10 crore of which most of them are cyclic and temporary migrants Main objective of their migration is to make earn a living before generating savings. These people can be targeted with short duration products Types of migrant population Permanent migrants Temporary migrants Cyclic migrants Need for Migration and pattern Migrate along with their family in search of better opportunities Employed in services and transportation industry Migrate to generate savings and return to village/shift to another region after 2- 3 years Employed in construction and manufacturing industry Migration depends on farming season Employed in farming related activities Primary needs Savings Remittance Examples Watchmen, hawkers, shop assistants in urban areas Construction workers, truck unloading, handicraft, packaging Harvest cutters, sugarcane cutters, pesticide spray workers Opportunity and challenges Usually have a relative residing in rural India who can assist with rural address proof Reside in large groups in urban areas Have trust in construction contractors who bring them to construction sites Do not have sufficient KYC documents Have trust in contractors who bring them to farming site Contractors also assists them in remittance of money to their families Targeted marketing initiatives Marketing initiatives at migrant pockets within cities Market RPLI products through labour contactors Bundle insurance with remittance products Sell in native villages of migrant population Prominent migration corridors UP to Mumbai Tamil Nadu to Mumbai UP, Bihar to Delhi UP rural areas to construction sites in Noida, Faridabad and Gurgaon Rural Maharashtra and Bengal to Mumbai – at construction sites UP to Punjab Orissa to Andhra Pradesh Permanent migrants cannot be sold RPLI policies since RPLI policies can be sold only to permanent residents of villages. India Post may consider relaxing RPLI rules to allow insurance coverage to permanent migrant segment.

…and target them with tailored marketing strategy 2 3 4 5 T 6 7 1 Create Awareness Publicize Products Stimulate Sales SDIPs in urban areas can conduct awareness campaigns at construction sites to educate migrants about health hazards, accidental hazards and vulnerability in case of death of earning member SDIP can educate labour contractors about availability and benefits of RPLI Posters can be put near worksites SDIP can give small talks during lunch time or after work hours Contractors can be paid referral commission to drive sales SDIPs/ Direct Agents shall coordinate with BOs/SOs to obtain residence proofs from villages Temporary migrants SDIP can educate labour contractors about availability and benefits of RPLI Posters can be put near worksites to publicize RPLI products SDIP can give small talks during lunch time or after work hours Short term group products are ideal for temporary migrants SDIP/BPM should sell policies in native location Contractors can be paid referral commission to drive sales SDIPs in rural areas can conduct awareness campaigns at farming sites to educate migrants about health hazards due to changing living conditions and vulnerability in case of death of earning member Cyclical migrants Note: In case of permanent migrants, permanent address proof should be of a rural area for the migrant to be eligible for RPLI

Product positioning for migrant customer segments needs to be communicated 2 3 4 5 T 6 7 1    Group Type Product positioning Participatory Annuity Term Group term Riders Temporary migrants Illness and accident riders Illness and accident riders are suitable due to higher probability of accidents at work sites and illness in due to poor temporary living conditions Shorter term group term products would be most suitable as they are simple to understand and premium amounts are affordable Cyclic migrants Single premium products Illness rider Have a lump sum savings after returning from harvest season. Single premium term products would be most suitable Illness riders are suitable as they are susceptible to illness due to changing living conditions across the year     Indicates most suitable. Other products can also be sold

Activity Trainees to be grouped in to as many groups as possible on the following lines Trainees from same division/region in one group If sufficient trainees are not available from the same division/region, trainees from the same circle to be grouped together

Continued The trainees to brain storm and identify the target group for RPLI . If possible trainees to identify any migrant population within their division/region The trainees to identify the social gatherings which can be utilized for popularizing RPLI Based on the above, the communication plan for each group has to be prepared

Awardees for best performance under PLI for the year 2011-12 Officials Business procured Circle Development Officers 1   R venkadesan     132.75 crore TN 2   C Krishnamurthy 57.61 crore    TN 3   V lakshmi Narain 49.99 Crore     TN   Departmental Officials 1   NK B S Tomar 26.84 crore APS 2   WO KRK Rao   25.79 crore APS 3   Nb Sub R Krishnan 24.13    APS GDS 1  Raj Kumar Thakur 15.41 crore Jharkhand 2  G Satyanarayan Reddy 4.73 AP 3   Shambhu Kumar Gupta 4.01 Jharkhand Look at this list!!!! Don’t you want to be one among them? Now let us go to the next slide

Top performers in RPLI for 2011-12 Category Name Business procured (crores) Circle Departmental Officials Santhosh Kumar Jha 13.70 MH S B Bhandari 13.24 S S Joshi 10.24 GDS Bipin Bihari Patnaik 50.5 Orissa Golak ch Jena 31.3 Sangam Keshari Mahapatra 27.40

A small calculation…. The instructor shows the incentive structure Calculate the incentive that these awardees would have earned as shown in slide 75 and 76

Let us introspect Can you see what you can contribute to your household, if you can achieve such a business? All legitimate, hard earned and assured income which you can be proud of Ultimately you also help the organisation to strengthen itself So, let us resolve to tap this challenging market very vigorously

Thank you