Private insurance firms say, over the past few years, they have been investing on digital technologies to reach semi urban and rural areas.
Illustration: Uttam Ghosh/Rediff.com
Public sector life insurance giant LIC is facing tough competition from private players that are using new-age digital marketing technologies.
According to latest data from Insurance Regulatory and Development Authority of India (Irdai), the market share of LIC in terms of first year premium up to May 31, 2019, was 66.08 per cent, down from 67.40 per cent up to May 31, 2018.
LIC’s market share fell marginally in the past one year, but over the past five years it has come down substantially.
LIC’s share in the overall life insurance business came down from 75.34 per cent in 2013-14 to 69.36 per cent in 2017-18. In tandem, the market share of 23 private insurers increased from 26.95 per cent in 2013-14 to 30.64 per cent in 2017-18.
Private insurance firms say, over the past few years, they have been investing on digital technologies to reach semi urban and rural areas.
“Our core strategy comprises 3 Ds – data, digitise and disrupt.
"We leverage data to understand the behaviour of our customers; we invest in digitisation to improve operational efficiencies; we focus on developing disruptive technologies to differentiate ourselves.
"This has resulted in better customer retention,” said Nipun Kaushal, chief marketing officer (CMO) of PNB MetLife.
According to Chandramohan Mehra, CMO, Bajaj Allianz Life Insurance, along with digital technologies, innovations in products in keeping with demands of the millennials has been a key growth factor.
“Millennials are looking to meet multiple life goals, and maximise living benefits. Hence, the whole narrative has changed,” Mehra said.
Ravindra Sharma, chief of brand and corporate communication, SBI Life Insurance, said, “Over the years, our traction in digital has increased multi-fold.
"From having a website in nine regional languages to equipping field agents with 360-degree digital tools for serving various consumer needs, we have strived to stay ahead of the curve.”
Among private insurers, HDFC Life had the largest market share of 9.24 per cent, followed by SBI Life with 6.49 per cent, and ICICI Prudential Life with 4.68 per cent shares at the end of May.
Much of the gains made by the private insurers could also be due to less spends on new offices. Between 2013 and 2018, the number of offices of private insurers came down from 6,759 to 6,204 (at end of March).
During the same time, the number of LIc offices increased from 3,526 to 4,908.
