Marketers need to go back to basics when it comes to selling life insurance in these changing times.
Over more than a decade since the category came into its own, many brands have come to spell life insurance only as i-n-v-e-s-t-m-e-n-t. But for a business that is all about mitigating life's risks to meet life's needs, it seems to have forgotten its own foundations in evolving, in marketing itself.
Today, especially in the new regulatory environment, the most important lesson for the life insurance category is probably to go back to its basics.
Sometimes it is worth remembering that the more things change, the more they remain the same. It's undeniably true of life insurance marketing and its role in today's changing times. Here's how:
Insurance marketing tenet 1: Life may change, life insurance shouldn't
From the heady, economic-high days of the early 2000s to the speed bump of 2009 and the subsequent recovery in 2010, life in India has witnessed multiple milestones from unrestrained optimism to caution to now a cautious optimism.
What's clear - and history has taught us this elsewhere many times - is that such cycles are not new, and demand that planning for security now is as important as planning for growth tomorrow. Or vice versa.
It highlights the fact that life insurance spells not one but three things: (1) s-a-v-i-n-g-s (2) p-r-o-t-e-c-t-i-o-n (3) i-n-v-e-s-t-m-e-n-t. It is what customers need at all times, whether they know enough to ask for it by themselves or not.
Which leads us to the next tenet.
Insurance marketing tenet 2: The more they know, the more you grow
History, a lot of times, does not repeat itself. Which is why there is a new generation of customers created almost every year that needs continuous education on how insurance enables multiple milestones in their lives.
In evolving beyond their own inception stages, brands can tend to forget that just because they are a decade (or more) old, it doesn't automatically signal that customer education is redundant.
On the contrary, even older generations don't have all the knowledge that enables them to see that insurance is a facilitator of education, sustained good health, marriage, protection after death, and every step in between.
In such a scenario, and in a category that is fairly young in India, there is no legacy of knowledge that is passed on from one generation to another among customers.
It becomes imperative for marketing, therefore, to ensure that brands borrow a leaf from the medical fraternity's book, and institute a continuing insurance education initiative - for themselves (that is, their employees and agents) and, more importantly, for their customers and prospects.
If the category is to help the customer see the merits of long-term savings and protection, then a long-term investment to educate them about their specific needs and options is crucial for brands.
Insurance marketing tenet 3: Mine the gold you have within reach
Unlike many other categories, life insurance - or the actuarial business, more broadly - is based on solid business analytics.
An understanding of customers, prospects and their specific needs is within the grasp of each insurance company.
While the business runs and evolves on these analytics, marketing doesn't always mine them to enhance the business.
Instead of educated guesses and anecdotal reports from the field, marketing has the tools readily available to enable and enhance the entire spectrum of business decisions: from new product development to identifying key customer segments; from strategy course correction to identifying new geographies.
Most importantly, business analytics can help predict overall market and consumption trends, identify gaps in customer need satisfaction, and help streamline customer education efforts.
In turn, these can lead to robust lead management, high persistency yields and increased loyalty and referrals.
Additionally, a direct line of communication can be established with customers - to educate them more credibly, and in a reassuring manner, about the cyclical nature of events, and the need for longer-term planning and protection as a means to meet their life goals.
Insurance marketing tenet 4: The opportunity to become agents of change
Multiple social forces have collided to create both the biggest opportunity and challenge for the insurance industry.
On one hand, rapid nuclearsation of families has meant that the traditional advisors and preservers of wisdom are no longer as easily accessible as in the past to most families.
On the other hand, a burgeoning middle class has meant a seemingly limitless market opportunity that only needs to be sold to.
While insurance companies have energetically pursued the latter, they have missed seeing the opportunity in the former, with the result that insurance agents are seen merely as pesky agents of sale.
In reality, this is the best time to fill the gap and create trustworthy advisors who can demonstrate they have nothing but customers' long-term security and prosperity in heart.
Marketing can play a crucial role in enabling this transformation by systematically training field staff on how to become agents of change.
By investing in a strategic communications programme that will change the agent mindset first, marketing can play a strategic role in facilitating customer education about the importance of a buying life insurance with a long-term perspective.
By bringing together these two stakeholders, life insurance companies can go from being faceless entities to actually investing the face of the company, namely, the agents with the power and the credibility to become true partners to customers in creating and ensuring the best possible futures for themselves and their families.
The author is director & chief marketing officer, Max New York Life.
