‘Financial illiteracy is Indian insurance sector’s top obstacle’
25 May 2014 8:16 PM GMT
The last few years have seen what management theorists term ‘reverse shift’ of talent to the public sector instead of private industry. Public sector insurance giant LIC’s Zonal Manager (North) A P Singh is almost a text book example of this phenomenon. A brilliant student, he holds a Master’s degree in English Literature from Allahabad University and a PGDHRM. In an illustrious professional career, he has held key positions such as Senior Divisional Manager at Meerut and Delhi DO -I, LIC Nepal Ltd CEO & MD, Management Development Centre Joint Director, LIC HFL Care Homes Ltd CEO and Zonal Manager (Central). He was also associated with IIM-Lucknow Founder-Director Professor Ishwar Dayal for five years while developing LIC’s Corporate HRD & OD initiatives. He tells Neha Thakur how he plans to take LIC North Zone’s business growth and servicing quality to new highs. His mission is to make LIC North Zone numero uno in this world class insurance corporation.
What are the new policies and plans launched by LIC?
Plans and policies are tailor-made. Someone who is young would think of higher education. Someone who has a marriageable daughter would think of her wedding and would like to save money. One would also like to plan for urgent medical exigencies to take care of health requirements. We have now introduced customer-friendly products so that customers don’t get confused while buying a plan. For example, one must plan for old age because he may need costly medicines and then if he is dependent on his children, he might not get the same respect he commanded when he was an income earner.
What issues are faced by insurance agents while selling plans to potential buyers?
The main issue is financial illiteracy. People don’t know what insurance means and how it can help one in old age. Due to this illiteracy, they can’t identify their requirements. People have the tendency to postpone and ignore insurance plans. They just leave it for the future. Secondly, there is a cultural problem — people don’t like to discuss plans openly in the family with their members. People don’t like to discuss contingency plans that need to be made in the event of their demise. They get upset when talking of death. They don’t care about sharing these concerns with their near and dear ones. Thirdly, there is a cultural taboo. People take it for granted that they will live forever. Lastly, insurance payments do not figure in people’s shopping lists and even if they are, they do not come as a top priority. People save for numerous things like cars but not for insurance. People actually wait for their insurance agents to come and explain because they are laid back about this.
What challenges are you facing in your zone and how are you dealing with them?
There is no zone-specific challenge. We are in a very competitive market and that is applicable for the entire country. The market in metros is very sensitive and highly competitive; so I have to ensure that we remain ahead of the competition and graduate from leader to market maker.
Tell us about your achievements as a zonal head?
I am focussing on neglected areas and trying to bring my team’s attention to such areas for improvement. I must say that the team with which I have been working has delivered. LIC’s North zone is at the No 1 position in terms of premium in the country and also at No 2 in policy growth as of March 31, 2013. Apart from that, we are at No 2 in the country in recruitment of Rural Career Agents and have shown 51 per cent growth in appointment of Senior Business Associates (SBA). The North Zone has also performed exceptionally well in alternative channels. For the first time, we have achieved the health insurance budget and were also first in the country to achieve the Micro Insurance (insurance meant for economically weaker sections) annual budget. In Chief Life Insurance Advisor channel (CLIA), we have achieved the No 1 position on seven counts out of eight in the country. These are the areas where LIC North Zone is distinctive and I am very happy with the performance.
Any wish list for the new government?
The youth must get jobs. Jobs should be the top priority as unemployment is the highest in the country. It leads to dissatisfaction among the youth. Second comes the problem of misgovernance. Then Corruption too is a major issue. It can’t be eliminated but it can be substantially reduced for sure. I hope the new Prime Minister Narendra Modi adopts a zero tolerance attitude towards corruption. Lastly, I hope Inflation is taken care of because the common man is affected by it. Coming from a poor a background, Modi should be able to understand the pain of inflation and the consequences of it on the aam aadmi.
What is your message to LIC agents and potential customers?
For potential buyers, I would like to add that they have reposed faith in LIC. This is why we continue to remain India’s pre eminent insurer with more than 76 per cent market share as on March 31, 2014.We expect that they will keep on reposing their trust in us and we will continue to be their number one choice as Insurer. As for the LIC agents, they must be more professional and must be more customer- and service-oriented. They should always keep the needs of customer at the top of their minds. There is always scope for doing a better job.
What are the new policies and plans launched by LIC?
Plans and policies are tailor-made. Someone who is young would think of higher education. Someone who has a marriageable daughter would think of her wedding and would like to save money. One would also like to plan for urgent medical exigencies to take care of health requirements. We have now introduced customer-friendly products so that customers don’t get confused while buying a plan. For example, one must plan for old age because he may need costly medicines and then if he is dependent on his children, he might not get the same respect he commanded when he was an income earner.
What issues are faced by insurance agents while selling plans to potential buyers?
The main issue is financial illiteracy. People don’t know what insurance means and how it can help one in old age. Due to this illiteracy, they can’t identify their requirements. People have the tendency to postpone and ignore insurance plans. They just leave it for the future. Secondly, there is a cultural problem — people don’t like to discuss plans openly in the family with their members. People don’t like to discuss contingency plans that need to be made in the event of their demise. They get upset when talking of death. They don’t care about sharing these concerns with their near and dear ones. Thirdly, there is a cultural taboo. People take it for granted that they will live forever. Lastly, insurance payments do not figure in people’s shopping lists and even if they are, they do not come as a top priority. People save for numerous things like cars but not for insurance. People actually wait for their insurance agents to come and explain because they are laid back about this.
What challenges are you facing in your zone and how are you dealing with them?
There is no zone-specific challenge. We are in a very competitive market and that is applicable for the entire country. The market in metros is very sensitive and highly competitive; so I have to ensure that we remain ahead of the competition and graduate from leader to market maker.
Tell us about your achievements as a zonal head?
I am focussing on neglected areas and trying to bring my team’s attention to such areas for improvement. I must say that the team with which I have been working has delivered. LIC’s North zone is at the No 1 position in terms of premium in the country and also at No 2 in policy growth as of March 31, 2013. Apart from that, we are at No 2 in the country in recruitment of Rural Career Agents and have shown 51 per cent growth in appointment of Senior Business Associates (SBA). The North Zone has also performed exceptionally well in alternative channels. For the first time, we have achieved the health insurance budget and were also first in the country to achieve the Micro Insurance (insurance meant for economically weaker sections) annual budget. In Chief Life Insurance Advisor channel (CLIA), we have achieved the No 1 position on seven counts out of eight in the country. These are the areas where LIC North Zone is distinctive and I am very happy with the performance.
Any wish list for the new government?
The youth must get jobs. Jobs should be the top priority as unemployment is the highest in the country. It leads to dissatisfaction among the youth. Second comes the problem of misgovernance. Then Corruption too is a major issue. It can’t be eliminated but it can be substantially reduced for sure. I hope the new Prime Minister Narendra Modi adopts a zero tolerance attitude towards corruption. Lastly, I hope Inflation is taken care of because the common man is affected by it. Coming from a poor a background, Modi should be able to understand the pain of inflation and the consequences of it on the aam aadmi.
What is your message to LIC agents and potential customers?
For potential buyers, I would like to add that they have reposed faith in LIC. This is why we continue to remain India’s pre eminent insurer with more than 76 per cent market share as on March 31, 2014.We expect that they will keep on reposing their trust in us and we will continue to be their number one choice as Insurer. As for the LIC agents, they must be more professional and must be more customer- and service-oriented. They should always keep the needs of customer at the top of their minds. There is always scope for doing a better job.
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