Unit-4: Implement and Deliver a Marketing Strategy

Meaning of Communication: Communication is a system through which people share

ideas, feelings, thoughts, facts, opinion, values and emotions with each other. It acts a s a
bridge of meaning among people.
Definition of Communication: According to Theo Haiman, “Communication means the
process of passing information and understanding from one person to another”.
According to Newstrom & Keith Davis, “Communication is the transfer of information from
one person to another. It is a way of reaching others by transmitting ideas, feelings, thoughts,
facts and values”.
Marketing Communication: Marketing communications is a subset of the overall subject
areas known as marketing. Marketing has a marketing mix that is made of price, place,
promotion, product that includes people, processes and physical evidence. When marketing
products and services, coordinated promotional messages delivered through one or more
channels such as print, radio, television, direct mail and personal selling.
Communicating the Marketing Message
Marketing communication acquires new customers for brands by building awareness
and encouraging trial. Marketing communication also maintains a brand’s current customer
base by reinforcing their purchase behaviour by providing additional information about the
brand’s benefits.
A secondary goal of marketing communication is building and reinforcing
relationships with customers, prospects, retailers and other important stakeholders.
Successful communication relies on a combination of options called the promotional mix.
These options include advertising, sales promotion, public relations, direct marketing and
personal selling. The marketing manager should concentrate for preparing effective
marketing message:
The internet has become a powerful tool for reaching certain important audiences. The
role each element takes in a marketing communication program relies in part on whether a
company employs a push strategy or pull strategy. A pull strategy relies more on consumer
demand than personal selling for the product to travel from the manufacturer to the end user.
A push strategy, emphasizes personal selling to push the product through these channels.
For marketing communication to be successful, however, sound management
decisions must be made in the other three areas of the marketing mix: the product or service,
the price and the places at or through which customers may purchase. The best promotion
cannot overcome poor product quality, high prices or insufficient retails distribution.
Successful marketing communication relies on sound management decisions
regarding the coordination of the various elements of the promotional mix. This perspective

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seeks to orchestrate the use of all forms of the promotional mix to reach customers at
different levels in new and better ways.
Marketers began to realize that advertising, public relations and sales were often at
odds regarding responsibilities, budgets, management input and myriad other decisions
affecting the successful marketing of a brand.
The marketing perspective itself began to shift from being market oriented to market
driven. Traditionally advertising was the dominant element in the promotional mix. Now
news reports, work-of-mouth, experts’ opinion and financial reports were used by the
consumers for making purchase decisions.
Steps for Creating Insurance Marketing Message
1. Know Your Audience: Based on the insurance products you offer, you’ll have different
types of audiences. Because of the nature of insurance marketing, you won’t be able to
segment your target audience simply based on demographics but will have to dig deeper into
psychographics and behavioural segmentation to properly identify and target your audience.
2. Understanding the path-to-purchase: You’ll also have to understand your audiences’
path-to-purchase for each product you offer. For the sake of an example let’s say you’re
creating a health insurance marketing plan - specifically for a comprehensive health
insurance product that you offer - and need to boost your digital sales this quarter. There will
be a different path to purchase each segment of the TG takes to buy the same product. A
middle-aged married man will probably be looking for a floater plan and you’d want to start
his journey with a family-focussed display ad, whereas a younger woman in her late 20s
might be searching for “ways to save tax” when she comes across your search ad.
3. Know Your Competition - Creating unique campaigns: The insurance marketing space
is very cluttered, and with legalities requiring you to be wary of what you say and how you
say it, brands often end up running similar campaigns. Research what your competition is
doing, not only so you may get inspired but more importantly, in this industry, so you don’t
accidentally plan a campaign in a similar space.
4. Building great user experiences: It’s also always a good idea to draw inspiration from
around the world when creating user experience - the industry demands that you have an
easy-to-use website that will help users swiftly calculate their premium and sign up for a
plan. Check out what the most modern insurance companies in the world have up their sleeve
and use their learnings to build your own.
5. Differentiating your product: The most important reason to research your competition, is
because your audience most definitely will be. No policyholder buys an insurance plan
without researching his options first. Staying up-to-date on what the competition has to offer
allows you to differentiate your product effectively.
6. Create Your Media Plan: Analyse where audiences in each of your target segments are
spending time online, and allocate budgets accordingly. You’ll have a lot of learnings once

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campaigns go live, so we’d recommend analysing and optimising along the way. You can
also set up growth experiments - an approach we use with growth marketing that involves
first using a small part of your budget to run campaign experiments, and then only scaling
what works.
Keep in mind, here again, that different segments of your audience might be frequenting
different platforms altogether, so you’ll need to create a media plan accordingly.
7. Prepare Your Collaterals: Prepare your collaterals - landing pages, ad creatives as per
your media plan, content marketing collaterals (don’t forget your remarketing creatives too!),
email marketing assets, etc. You’ll want to go over points 1 and 3 in detail here and make
sure you’re creating communication that will speak to each of your segments at each stage of
the buying journey.
8. Set Up Your Tracking & Reporting Formats: Have reporting formats ready to track the
effectiveness of each advertising platform, analyse where users are dropping off in the
journey on your landing page, and where they’re engaging with your ads/webpage and
getting you great returns. This tracking should be done on a daily basis with weekly reports
shared within the team, so you can quickly turnaround the campaign as needed.
The Elements of Marketing Communication Mix
The five elements of the Marketing Communicating Mix are:
1. Advertising: This is the mass media method of marketing communication and provides
exposure to the largest, most geographically dispersed audience at the lowest cost per head.
The traditional forms of paid advertising include newspapers, magazines, billboards, signs,
posters, advertising on buses, benches, gas pumps and even public restrooms.
2. Direct Marketing: This marketing communication competency enables companies to
reach out directly to consumers without intermediary channels such as those required for
advertising. This component of the marketing communication process includes direct mail,
catalogs, coupons and inserts, telemarketing, online marketing and television infomercials.
Direct marketing is the marketing communication method that enables companies to interact
with a relatively large number of customers.
3. Personal Selling: selling is a face-to-face selling technique by which a salesperson uses
his or her interpersonal skills to persuade a customer in buying a particular product. The
salesperson tries to highlight various features of the product to convince the customer that it
will only add value. This is the most dreaded as well as the most expensive of all methods in
the marketing communication process.
4. Public Relations: This refers to how you handle your relationships and the flow of
information with public. Public relations is a valuable tool in the promotional mix. Unlike
paid marketing programs such as advertising your business, public relations is focused on
earned media and can take advantage of unpaid communication channels. Public relations is
about managing perceptions – how people think about your business. Public relations tool

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include press and media releases, public events, advertorials, financial reports, promotional
collateral, sponsorships, interviews and any other method for the promotion of a positive of a
positive image to people.
5. Sales promotion: This is the last traditional component of the marketing communication
mix that is discussed here as part of the communication process. Sales promotion simply
refers to purchase incentives that you provide your with. These can assume a number of
forms including offering free goods or services, coupons and vouchers, gifts and prizes,
discounts, samples, financial incentives, promotions and any other value-add over and above
the standard product or services.

E-marketing:
E-marketing is an advertising discipline that includes all marketing activities conducted by a
business online using an electronic device or the internet. Other names for this type of
marketing include internet marketing, online marketing, digital marketing or web marketing.
Within this framework, a business uses modern media and technologies to attract new
customers, keep current customers and build a brand identity. There are many online tools a
business can use for e-marketing based on your business goals, products, capacity and target
market.
Why is e-marketing important?
It's important to have an effective e-marketing plan in place for your business to keep up with
growth and changes in your customers' technology use. Here are some other reasons e-
marketing is so important:
1. Online customers: People search the internet daily to find a variety of information about
businesses, products and services. E-marketing is valuable as it allows you to reach and
target those people who are already using electronic devices and the internet to interact with
companies.
2. Alternative communication channels: E-marketing helps you communicate better with
your target audience. Reaching customers through digital marketing channels makes finding
your contact information simple. Browsers can then call, chat, message or email your
business with questions right from their devices. When you reply, you start two-way
communication, which builds relationships and helps your audience see your company as a
valuable source of information. This may help non-customers become clients.
3. Personalized marketing and customized experiences: People who find your business
online may contact your company for different reasons. E-marketing enables you to
personalize your advertising strategies and create customized experiences that target your
audience's best interests. Personalized e-marketing helps you deliver a better experience for
new leads, which can convert them into loyal customers.
3. Quality traffic: When used effectively, e-marketing can help you reach the right leads at
the right time and drive them to your website or online store. You can get very precise with

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your targeting, ensuring you reach people you know are interested in your business. E-
marketing allows you to target leads by demographic information, hobbies, interests and
spending habits.
4. Brand visibility: E-marketing tools and strategies allow you to increase your brand's
visibility and make people more familiar with your business. When people interact with a
business or brand repeatedly, it begins to feel comfortable and familiar. People are more
likely to choose a business they're used to when making a purchase. Leads can also access
your business website and social media channels at all times, significantly increasing your
visibility.
3. Campaign variety: With e-marketing, you can run multiple marketing campaigns through
various channels at once, maximizing your reach. The internet gives businesses the capacity
to take on lots of customers and still provide a quality experience. Most business websites
can handle many customers and multiple transactions simultaneously, which allows you to
grow your business quickly.
Types of e-marketing
1. Search engine optimization (SEO): Search engine optimization, or SEO, involves
structuring or editing your website to improve its placement in search results for free. The
goal of SEO is to get search engines to rank your website as high in the results as possible for
specific keywords or phrases. Additionally, you're trying to train the search engines to
recommend your content as a solution to a user query.
SEO uses on-page factors like design structure, user experience and content as well as off-
page factors like backlinks and social shares to communicate with the search engine program
and provide information about the site's purpose. Well-executed SEO helps businesses reach
their target audience and rank above competitors in search results, which can lead to
attracting more customers and increased sales.
2. Email marketing: Email marketing involves creating a subscriber list or database of
targeted prospects and then marketing a product or service to them via email. Email
marketers can specifically target segments of those email lists and craft tailored
correspondences to increase conversions.
3. Influencer marketing: Influencers are individuals with a large social media following
who promote products or services for a fee. Influencer marketing takes place when a
company contacts one of these people and creates a partnership. The influencer receives
monetary compensation or products and services in exchange for creating or sharing content
about a specific business with their followers.
4. Affiliate Marketing: Affiliate marketing is an e-marketing strategy involving three
parties: the product owner, the affiliate marketer and the end consumer. Affiliate marketers
select a product and then promote it for the owner using blogs, videos or advertisements. The
consumer can buy the product online, using a link supplied by the affiliate, usually at a

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discounted price. The affiliate marketer can get paid a predetermined commission on each
sale.
5. Reputation marketing: Reputation marketing is an e-marketing strategy that uses social
media and customer review platforms to boost a business’s reputation and increase sales.
With more people taking part in online shopping since the invention of the internet, online
reviews and referrals have become a source of product endorsement and recommendations
for consumers. Reputation marketing involves building a brand’s image by encouraging
customers to post positive reviews on specific platforms and social media.
6. Video marketing: Video marketing uses moving media to raise awareness, increase
engagement and drive sales on digital and social channels. It overlaps with content marketing
and plays a significant role in e-marketing, allowing businesses to reach their audience with a
different medium. Video marketing is a very effective way to capture the attention and
emotions of your target audience and promote your product or service.
7. Instant messaging marketing: Instant messaging marketing allows businesses to reach
their target audience promptly and effectively. This marketing strategy uses real-time chat
platforms for customer support, to promote special offers and send notices. This type of
marketing gives customers another option for communicating immediately with a customer
service representative rather than calling a phone number or communicating in an email
chain.
8. Content marketing: Content marketing is the creation and distribution of free,
informative content. The focus of this type of marketing is on communicating information
with customers rather than selling a product. Businesses aim to attract and keep a specific
target audience by providing valuable, consistent knowledge. Content marketing can be one
of the best e-marketing types for a business website because search engines rank websites
based on the information on each page. The more high-quality content you have on your
website, the more opportunities you have to appear in search results, making it easier for
people to find your business or product.
9. Conversion rate optimization (CRO): Conversion rate optimization, or CRO, can play a
significant role in the overall success of any internet marketing strategy. It is the process of
increasing the percentage of website visitors who take a desired action, known as a
conversion. What counts as a conversion differs from business to business and could be
anything from completing a form to making a purchase.
It's possible that in every step a customer takes toward a conversion, some will abandon the
process. CRO aims to reduce the number of customers lost by understanding how they
experience a website, what actions they take and what's preventing them from taking the next
step toward a conversion. With this data, CRO specialists can optimize the website to
maximize conversions at each stage.
10. Social media marketing (SMM): Social media marketing is the use of social media
platforms to promote a business and connect with customers. It is a cost-effective form of

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marketing because most social media platforms allow businesses to create profiles for free.
SMM experts use social media marketing not just for sales, but also to build brands. This
method can be effective to increase engagement, build relationships, compile market
research, showcase products and celebrate achievements of an organization.
11. Pay-per-click (PPC) advertising: Pay-per-click (PPC) advertising is an e-marketing
strategy that helps businesses gain site visitors and sell more products or services by paying
for advertising space on search engines and other websites. When used properly, this strategy
can increase traffic to a specific site or page. Pay-per-click advertising allows you to pay as
you go, only when someone clicks on your advertisement.

Sales of Insurance Product

Insurance sales agents contact potential customers and sell one or more types of
insurance. Insurance sales agents explain various insurance policies and help clients choose
plans that suit them.
Duties of Insurance Sales Agents
i. Call potential clients in order to expand their own customer base.
ii. Interview prospective clients to get information about their financial resources and
discuss existing coverage.
iii. Explain the features of various policies.
iv. Analyse clients’ current insurance policies and suggest additions or other changes.
v. Customize insurance programs to suit individual clients.
vi. Handle policy renewals.
vii. Maintain electronic and paper records.
viii. Insurance sales agents commonly sell one or more types of insurance, such as property
and casualty, life, health and long-time care insurance.
Insurance Sales Agents Work Schedules: Insurance sales agents usually determine their
own hours of work and often schedule evening and weekend appointments for the
convenience of clients. Some sales agents meet with clients during business hours and then
spend evenings doing paperwork and preparing presentations to prospective clients.
➢ Insurance Sales Agent Education: A high school diploma is the typical requirement
for insurance sales agents, although a bachelor’s degree can improve one’s job
prospects. Public speaking classes can be useful in improving sales techniques and
often agents will have taken courses in business, finance or economics. Business
knowledge is also helpful for sales agents hoping to advance to a managerial position.
➢ Insurance Sales Agent Training: Insurance sales agents learn many of their job
duties on the hob from other agents. Many employers have new agents shadow an
experienced agent. This practice allows the new agent to learn how to conduct the
company’s business and to understand how the agency interacts with clients. Agents
can enhance their selling skills and broaden their knowledge of insurance and other

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 financial services by taking courses at colleges and universities or by attending
conferences and seminars sponsored by insurance organisations.
➢ Licenses, Certifications and Registrations: Insurance sales agents must have a
license in the states where they work. Separate licenses are required for agents to sell
life and health insurance and property and casualty insurance. In most states, licenses
are issued only to applicants who complete specified courses and who pass state
exams covering insurance fundamentals and state insurance laws.
Important Qualities of Insurance Sales Agents
1. Analytical Skills: Insurance sales agents must evaluate the characteristics of each
client to determine the appropriate insurance policy.
2. Communication Skills: Insurance sales agents must be able to communicate
effectively with customers by listening to their requests and suggesting suitable
policies.
3. Initiative: Insurance sales agents need to actively seek out new customers to maintain
a flow of commissions.
4. Self-confidence: Insurance sales agents should be confident when making “cold”
calls. They must speak clearly and persuasively and maintain their composure if
rejected.
Account Management: An account manager is an employee who is responsible for the
day-to-day management of a particular customer’s account with the business. The account
manager is a point of contact and provides customer support, upwelling, technical assistance
and general relationship management.
Insurance account managers promote their company’s insurance products to those who
will be directly selling them, such as brokers and independent financial advisers. It is an
account manager’s role to develop sales of the products and business accounts and they will
usually specialise in one particular area of insurance such as:
i. Corporate Insurance
ii. Life Assurance
iii. Reinsurance
Insurance account managers work with a caseload of several clients, building up long-
term relationships with them. They play a central role in introducing new insurance products
to the market, while also seeking to maintain the commercial performance of existing
products.
Responsibilities: Insurance account managers usually work to sales targets. Work is mainly
with commercial insurance, although the tasks are similar in all sectors and typically include:
a) Gaining new business by identifying and exploring opportunities in the local market.
b) Developing and maintaining good working relationships with clients, primarily
insurance brokers and independent financial advisers.

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 c) Introducing new products and promoting them through regular visits and
communication with intermediaries.
d) Increasing profitability of existing product lines by encouraging clients to use added
value services wherever possible.
e) Consulting on the most effective cover for a particular need.
f) Delivering good customer service by responding swiftly to queries and concerns from
clients.
g) Maintaining detailed knowledge of new and existing products by liaising with
colleagues.
h) Ensuring credibility with clients by maintaining detailed knowledge of current market
conditions and competitors products.
i) Monitoring and reporting on performance against agreed sales targets, sometimes
including monitoring the performance of other sales staff.
j) Ensuring compliance with regulations and procedures as laid down by the Financial
Conduct Authority (FCA) by keeping up to date with all changes in the regulatory
framework.
k) Working with underwriters to amend policies where necessary in order to meet client
demand.
l) Producing marketing literature and website content to support marketing campaigns.

Sales Promotion: Sales promotion refers to the activities which supplement and co-
ordinate personal selling and advertising to attract customers to buy a product. Sales
promotion methods include displays, demonstrations, expositions, exhibitions and other non-
recurrent selling efforts which aim at impelling spot buying action by prospective customers.
Consumers are attracted by displays, packaging and publicity.
Objectives of Sales promotion activities
1. Providing information: The producer generally provides the information regarding
the quality, uses, different uses of the products and the price etc to the consumers
while introducing the product.
2. Increase in sales: The main purpose of all promotional activities is to increase the
sales of the products of the company. Promotional activities increase the sales by
changing the elasticity of demand of the product through various techniques, i.e., by
distributing samples, free gifts, discounts etc.
3. Reducing seasonal decline: In slack season, the promotional activities help in
maintaining the sales of the product. Customers and middlemen are offered attractive
discounts and free gifts along with the products to induce them to purchase their
products.
4. To keep memory alive: One of the objectives of the sales promotion is to keep the
memory of the product alive in the minds of the present customers.
5. To induce middlemen to purchase more: The middlemen-wholesalers retailers are
induced to purchase mere stock by offering more facilities such as credit facilities,
higher trade and cash discount and free gifts etc.

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Public Relations: Public relations (PR) are the practice of managing the spread of
information between an individual or an organisation and the public. Public relations may
include an organisation or individual gaining exposure to their audiences using topics of
public interest and news items that do not require direct payment.
The aim of public relations is to inform the public, prospective customers, investors,
partners, employees and other stakeholders and ultimately persuade them to maintain a
certain view about the organisation, its leadership, products or political decisions.
Public relations specialists establish and maintain relationships with an organisation’s
target audience, the media and other opinion leaders. Common responsibilities include:
➢ Designing communications campaigns
➢ Writing news releaser and other content for news
➢ Working with the press
➢ Arranging interviews for company spokespeople
➢ Writing speeches for company leaders
➢ Acting as an organisation’s spokespeople
➢ Preparing clients for press conferences
➢ Media interviews and speeches
➢ Writing website and social media content
➢ Managing company reputation
➢ Managing internal communications
➢ Managing marketing activities like brand awareness and event management etc.
Success in the field of public relations requires a deep understanding of the interests and
concerns of each of the client’s many publics. The public relations professional must know
how to effectively address those concerns using the most powerful tool of the public relations
trade, which is publicity.
Qualities of Public Relations (PR) Professionals:
1. Be Optimistic: What a company looks in its public relations professional is optimism.
The situation may be as its worst but the public relations professional needs to
maintain a steady and professional demeanor and go ahead with the job. A never say
die attitude is a must for someone working in the public relations department.
2. Walk the walk and talk the talk: Practicing what one preaches is important in a PR
role. As a public relations professional, it is important to be clear about everything,
policies and practices, before facing the world outside and communicating.
3. Be assertive and extrovert: The former quality allows one to draw the lines as and
when required while the later quality helps one maintain good relations with the
company as well as the media and the public.
4. Be honest: Honesty is a very good policy. Blunt truth does not always work in a
public relations role but dishonesty is a complete no-no. It is required to have effective
communication skill and the ability to play around with words.

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 5. Be helpful: Going that extra mile is a great quality for public relations professionals.
A helpful attitude always helps, especially when communicating bad news.
6. Be knowledgeable: The employer will expect its public relations professionals to
have knowledge about almost everything. Knowledge about current affairs and global
news is a must. One never knows which question to expect during a press conference.

Promotion: Promotion is one of the four variables in the marketing mix. It refers to an
activity, such as a sale or advertising campaign, designed to increase visibility or sales of a
product. Basically, it is communicating information between producer/seller and buyer or
prospective buyer to change attitude and behaviour of consumers. The promotion has become
necessary today as selling has become more complex today because product are more
technical and customers are more sophisticated and the competition has become more
intense. These all valuables are make it necessary for the product producer or seller to make
proper flow of communication to the buyers or prospective buyers about the characteristics
of his products.
Nature of Promotion
1. Customers are informed about the product or services of the company, either at the
time of information of a new product into the market or when any change is made in
the existing product.
2. Customers are reminded of the products and services of the company.
3. Customers are persuaded to purchase the products and services of the company.
4. Promotion includes, advertising, personal selling and other sales promotion.
5. Promotion activities are performed by the manufacturer. It is the responsibility of the
producer to get information about the consumers and prospective consumers so that
the necessary product may be served to meet their demands.

Sponsor: Sponsor is a person, firm, organisation etc., that finances to buys the time to
broadcast a radio or television program so as to advertise a product.
Corporate Sponsorship: A corporate sponsorship is a form of marketing in which a
corporation pays for all of some of the costs associated with a project or program in
exchange for recognition. Corporations may have their logos and brand names displayed
alongside of the organisation undertaking the project or program, with specific mention that
the corporation has provided funding.
Sponsorship of Insurance Industry
i. The Times Group
ii. Fiinovation
iii. Union Bank of India
iv. State Bank of India
v. Ravin Group
vi. Life Insurance Corporation of India (LIC)

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 vii. DLF Foundation
viii. Maharashtra State Electricity Transmission Company Limited
ix. Next Gen
x. Bank of Baroda
xi. Bank of India
xii. Jawaharlal Nehru Port (JNP)
xiii. Maharashtra Airport Development Company Limited (MADC)
xiv. Doha Bank
xv. New India Assurance Co Ltd

Developing an Emergency Communication Plan

When an emergency occurs, the need to communicate is immediate. A business must
be able to respond promptly, accurately and confidently during an emergency in the hours
and days that follow. Many different audiences must be reached with information specific tot
heir interests and needs. The image of the business can be positively or negatively impacted
by public perceptions of the handling of the incident.
1. Getting started with emergency communication planning: A typical emergency
communications plan should be extensive in detail and properly planned by a business
planner. Internal alerts are sent using either email, overhead building paging systems,
voice messages or text messages to cell/smart phones with instructions to evacuate the
building and relocate at assembly points, updates on the status of the situation and
notification. External emergency communications are used to provide status
information to key clients and stakeholders.
2. Eight things emergency communications plan must do: An emergency
communications plan must be able to do the following eight things:
i. Launch quickly
ii. Brief senior management on the situation
iii. Identify and brief the company spokesperson of the situation.
iv. Prepare and issue company statements to the media and other organisations.
v. Organise and facilitate broadcast media coverage.
vi. Communicate situation information and procedural instructions to employees
and other stakeholders.
vii. Communicate with employee families and the local community.
viii. Continually adopt to changing events associated with the emergency.

3. General emergency communications planning considerations: Once the plan is

complete, review and exercises it to ensure that the documented procedures make
sense and supporting materials (e.g., press release forms, media briefing
arrangements, lists of critical contacts) are up to date. Focus emergency content on
relevant information. Provide only the relevant facts as they are available, get them

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 out quickly and proactively, follow up regularly, keep relevant parties informed,
resolve incorrect information and tell the truth about the situation.
4. Free emergency communications planning template for business continuity
planners: SearchDisasterRecovery.com has created a free, downloadable emergency
communications planning template for business continuity planners. It can be used as
a basic emergency communications plan. Each of the steps will have additional
actions within them, which need to be defined and incorporated into the overall plan.

Insurance distribution Channels:

Distribution is the process of delivering your products or services to your target markets.
Distribution channels are key to success for all insurance companies. They ensure that
products and services provided by insurers reach target customers in the most linear and
cost-efficient manner. A variety of distribution channels with various strategies and
positions are available in the market. Distribution channels are divided into the following
two types:

1. Direct channels:
These channels make direct contact between insurers and customers. In the direct
channel total control over how the product is marketed and sold is in the hands of
the insurer.

2. Indirect channels:

Indirect channels are those in which there is no direct contact between insurers and
customers. It includes insurance brokers, reinsurance brokers, financial
organizations, independent financial advisers, managing general agents, retail
organizations, affinity groups, peer-to-peer, broker networks, and aggregators.

In today’s world, Insurance companies have a lot of delivery methods for their products
and services. Digital marketing is substantially on the rise but along with this, we can’t
undermine the efforts of agents or brokers in insurance marketing. A variety of
distribution channels are currently used in the marketplace, and some insurers utilize a
combination of distribution channels. The following are some distribution channels of
insurance products:

• Bank-led channel
The bank-led distribution channel is also known as ‘Bancassurance’. In this
channel, banks and insurance carriers join together to sell insurance products to
consumers. The passage of the Financial Modernization Act of 1999, was predicted
for the U.S. market which ensured the growth of the bank-led channel in the U.S.
The channel utilizes the strengths of both the insurance carriers and banks to not
just distribute insurance policies but also to increase customer satisfaction and
maximize their own profits by minimizing the costs. Banks with their expanded
reach in the financial services market were the perfect vehicle to assist the

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 insurance carriers. Thus bancassurance channel appeared like a boosting fuel for
insurance companies.

• Peer to peer(P2P) groups

Peer to peer(P2P) group is a recent innovation in the insurance industry which

attracts many customers towards itself. P2P insurance is a risk-sharing network
where a group of people pools their premiums together to insure against a risk.
Peer-to-Peer Insurance reduces the conflict that inherently arises between a
traditional insurer and a policyholder when an insurer keeps the premiums and it
doesn’t pay out in claims. The P2P insurance pool is comprised of family
members, friends, or individuals with similar interests who team up to contribute to
each other’s losses. This type of insurance may also be known as “social
insurance.”

• Direct response marketing

Direct response marketing may be defined as the use of mass media advertising to
generate inquiries directly to insurers. It does not involve the sale of insurance
through local agents. In direct response marketing, employees of the insurer deal
with applicants and customers through telephone, by personal meeting or more
frequently via the Internet. Direct selling continues to be the dominant channel of
distribution for insurance companies.

• The Internet channel

The Internet is likely to be the latest and most important of the new forms of
insurance distribution channel. It is already apparent that customers are using new
Internet technology in almost all business fields. Web technology supports multiple
marketing channels, including agents, sales of insurance products, and call centers.
However, insurers have been slow to get to this distribution channel.

• Direct mail marketing

It means selling insurance products by dealing directly with consumers rather than
through intermediaries. Direct mail campaigns deliver better overall responses than
digital channels. In this marketing channel, there is no need to share profit margins
and the insurer has complete control over the sales process.

Issues and Concerns with distribution in the Rural Market

There are several issues and concerns related to distributing financial products in
rural areas due to which financial service providers have been hesitant towards providing
financial services. These issues are examined below:

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 1. Competition: The competition among various financial product players is getting
fierce over the years through the influx of new financial service providers/vendors
in the industry. These providers are under continuous pressure to maintain growth
in their up lines as well as bottom lines. This has led these companies to
concentrate more on the urban areas than the semi-urban and rural areas since these
areas would require either setting up new branches, setting advanced technologies
etc.

2. Scale of investment: The funds available for investments among rural households
are observed to be lower than the urban household due to lower incomes.
According to a survey conducted by NCAER and MAX New York Life in 2005,
the average income levels of urban households in India are 85% higher than that of
rural household. Further, rural households could avoid huge investments in risky
financial products since income irregularities.

3. Customers scattered over wide areas: The investors in the rural areas are
scattered over a wide geographic area thus creating accessibility problems for the
financial service providers/vendors. The providers would have to incur huge costs
on setting the required infrastructure for providing financial products among large
number of dispersed rural households. Also, the rural investors may not prefer
travelling long distances to avail the financial services due to lack of accessibility,
awareness, willingness etc.

4. Rural infrastructure: Many villages in India lack infrastructural facilities like

roads, electricity, telecommunications and internet networks. This creates
operational hurdles for players to enter into these markets further discouraging the
rural households to reap the benefits provided by the players.

5. Irregularity in payments: Most financial products require regular investments at

defined time intervals by the investors. For example, an insurance policy holder
has to make a regular premium payment to the insurance company in order to keep
the policy active. A majority of rural households re involved in agricultural
activities who occasionally fail to make such regular investments since their
incomes are largely dependent on vagaries of monsoon.

6. Operational challenges: Companies may face operational challenges such as

obtaining relevant documents for verification. Some of the most commonly
required documents include a PAN card, ration card, birth certificate etc.

7. Cultural diversity: Financial service providers find it difficult to penetrate into

the rural areas due to the cultural diversity observed in India. Promotion of
financial products thus becomes difficult as the sales and marketing personnel are
required to understand the local customs, culture and language.

Branch offices, one of the direct channels of insurance marketing, have also continued to
be a key element in the distribution systems of both life and non-life insurance

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companies. All insurance companies have an agency-building distribution strategy under
which they recruit, train, finance, and oversee their agents/advisors. Through these
offices, personal contact and relationship can be established with the customers. The
insurance industry is witnessing a growing trend in adopting alternate channels of
distribution to fuel business growth. An innovative idea of distribution is the new mantra
and insurers are aligning their business strategy in line with changing customer
requirements and preferences. It is imperative for them to strike the right balance between
traditional and modern models to survive for a longer period of time.

Financial Institutions: A financial institution is an establishment that conducts

financial transactions such as investments, loans and deposits. Almost everyone deals with
financial institutions on a regular basis. Everything from depositing money to taking out
loans and exchanging currencies must be done through financial institutions. The various
financial institutions are:
1. Commercial Banks: Commercial banks accept deposits and provide security and
convenience to their customers. Commercial banks also make loans that individuals
and businesses use to buy goods or expand business operations, which in turn leads to
more deposited funds that make their way to banks.
2. Investment Banks: While investment banks may be called “banks”, their operations
are far different than deposit-gathering commercial banks. An investment bank is a
financial intermediary that performs a variety of services for businesses and some
governments. These services include underwriting debt and equity offerings, acting as
an intermediary between an issuer of securities and the investing public.
3. Insurance Companies: Insurance companies pool risk by collecting premiums from a
large group of people who want to protect themselves and/or their loved ones against a
particular loss, such as a fire, car accident, illness, disability or death. Insurance helps
individuals and companies manage risk and preserve wealth.
4. Brokerages: A brokerage acts as an intermediary between buyers and sellers to
facilitate securities transactions. Brokerage companies are compensated via
commission after the transaction has been successfully completed. A brokerage can be
either full service or discount. A full service brokerage provides investment advice,
portfolio management and trade execution. In exchange for this high level of service,
customers pay significant commissions on each trade.
5. Investment Companies: An investment company is a corporation or a trust through
which individuals invest in diversified, professionally managed portfolios of securities
by pooling their funds with those of other investors. Rather than purchasing
combinations of individual stocks and bonds for a portfolio, an investor can purchase
securities indirectly through a package product like a mutual fund.
Call Centre for Insurance Marketing Strategy
1. Straight selling: In this case, the agent explains upfront that he is calling to sell a
product to those who need it. There is no attempt at manipulation and it is hoped

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 trust is established. Of course, some prospects, who could benefit, may withdraw
early from the call, so it’s a good idea to ask some qualifying questions early on,
e.g., for car insurance:
a) Do you own a car?
b) Are you happy with your current car insurance premium?
c) Would you like me to run a quote?
2. Objection selling: This is a technique based on dealing positively with objections
the potential customer might raise. Each objection is an opportunity to highlight
the merits of your offering, make it relevant to your client’s needs, share more
information about your offering etc. By listening carefully to each objection,
repeating it back to the client and then answering it in full, the agent moves
towards the sale.
3. Spin Selling: In this technique the agent:
a) Asks questions that identifies/highlights a problem.
b) Discusses with the client the negative consequences if the problem is not
dealt with.
c) Offers a solution to the problem.
Financial Advisers for Insurance Product
1. Insurance companies refer to insurance sales force as producers: An advisor takes
on a different role when selling an insurance policy that of an insurance salesperson.
The fundamental change in roles from an advisor who is paid for advice to a producer
for an insurance company causes the client-advisor relationship to become more
conflicted than may be appropriate. While the customer still have to go to an
insurance agent for insurance, financial advisors believe their only duty should be to
the client.
2. It pays to work with an independent insurance agency: The first point is not to say
insurance agents are bad, a good agency can add significant value to your protection
planning. Instead of purchasing policies though from an individual advisor who may
not be around when the customer need to draw on his policies, an insurance agency
will be around for years to come.
3. Knowledge of best deal: Advisory firms may have a relationship with one insurer and
favour them over another. By separating financial advisor from any commission
products. An insurance agent who is a specialist and an advisor who is a second set of
eye on the insurance approach.
4. Insurance can be a specialised field: Not all insurance agents or agencies are
licensed in or specialists in all types of insurance. It is difficult to be a specialist in
everything when providing ongoing financial guidance to families on a regular basis.
Intermediaries / Brokers:
1. Banks: The marketing and distribution strategies of banks are different in urban and
rural areas due to diverse demographic and socio-economic nature of these markets.

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 The distribution channels used by banks include bank branches, ATMs, internet
banking, phone banking, direct selling agents, call centres, etc. Private banks are
mostly concentrated in urban areas. The distribution networks developed by public
banks in urban as well as rural areas are a result of policy measures due to which the
number of public sector bank branches is higher as compared to private or foreign
banks.
2. Insurance: The insurance sector can be classified into life insurance companies and
non-life insurance companies. Non-life insurance companies utilise distribution
channels such as direct mail, direct sales force, insurance agents, agreements with the
corporate, banks, real-estate companies etc. However, in life insurance companies;
distribution is mainly through agents, as the personal interaction is necessary for
persuading the customer.
3. Micro Finance Institutions (MFIs): MFIs are an important distribution channel for
many insurance companies. MFIs lend to Self Help Groups (SHGs) in the rural areas.
Many insurance companies are selling group term insurance policy to the members of
the SHG who have collectively taken credit from the MFI.
4. The private players are also tying up with public sector banks, co-operative bank and
the Regional Rural Banks (RRBs) to penetrate into the rural market. The large rural
customer base and wide branch network of these banks offer an effective distribution
channel to the insurance companies, thereby promoting bancassurance.
5. A few insurance companies have also tied up with customer goods companies like
HLL, ITC, etc., which have a well set-up distribution network. For example, ICICI
has entered into an agreement with e-choupals, the web based marketing platform of
ITC, to market and distribute its insurance products to the rural households.
6. Regulators: Along with above financial service providers, regulators also have an
important role in promoting financial products in rural areas.
a) Insurance Regulatory and Development Authority (IRDA)
b) Building bank networks in rural areas.
Bancassurance: Bancassurance is an arrangement in which a bank and an insurance
company form a partnership so that the insurance company can sell its products to the bank’s
client base. This partnership arrangement can be profitable for both companies. Banks can
earn additional revenue by selling the insurance products, while insurance companies are
able to expand their customer bases without having to expand their sales forces or pay
commissions to insurance agents or brokers.
Benefits of Bancassurance
1. It encourages customers of banks to purchase insurance policies and further helps in
building better relationship with the bank.
2. The people who are unaware of and/or are not in reach of insurance policies can be
benefitted through widely distributed banking networks and better marketing channels
of banks.

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 3. Increase in number of providers means increase in competition and hence people can
expect better premium rates and better services from bancassurance as compared to
traditional insurance companies.
Demerits of Bancassurance
1. Data management of an individual customer’s identity and contact details may result
in the insurance company utilizing the details to market their products, thus
compromising on data security.
2. There is a possibility of conflict of interest between the other products of bank and
insurance policies. This could confuse the customer regarding where he has to invest.
3. Better approach and services provided by banks to customer is a hope rather than a
fact. This is because many banks in India are known for their bad customer service
and this fact turns worse when they are responsible to sell insurance products.
4. Work nature to market insurance products require submissive attitude, which is a point
that has to be worked on by many banks in India.
Aggregators: The insurance aggregator provides the potential client with comparative
insurance quotes and the opportunity to discuss a specific quote. The insurance
aggregator will transmit the details of the potential client to the insurer and the insurer
will contact the potential client to conclude the policy of insurance.
The insurance aggregator develops the “quotation portal/search utility”, markets this
medium and agrees with the participating insurers to be paid a referral fee policy
contracts concluded based on the client information provided to the insurers by the
aggregator.
Methods:
1. The Broker/Financial Advisor: This is the traditional method whereby the client
consults with his broker and explains to him his need for insurance. The Broker
approaches insurers and presents options to the client. The Broker receives a
commission from the insurance company selected for the advice rendered once the
policy has been concluded.
2. Direct Insurance: The client approaches the insurance company directly. This
takes place via telephone or on-line and the client by-passes the broker or
middleman and the expenses of broker commissions.
3. Insurance Aggregator: This is a website portal or search utility to enable a client
to gain several quotes via an electronic e-quote form. The Insurance Aggregator
concludes agreements with a number of Insurers to provide a comparative quote
based on pre-determined list of specified needs as disclosed by potential clients.
Risk Assessment: Risk assessment is the determination of quantitative or qualitative
estimate of risk related to a well-defined situation and a recognized threat (also called
hazard). Quantitative risk assessment requires calculations of two components of risk R:the
magnitude of the potential lass (L) and the probability (P) that the loss will occur. i.e.

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 An acceptable risk is risk that is understood and tolerated usually because the cost or
difficulty of implementing an effective countermeasure for the associated vulnerability
exceeds the expectation of loss.
Risk Assessment Procedure:
1. Control Environment: The control environment is and organization’s culture, beliefs
and values. It includes the integrity, ethical beliefs and competencies of its people,
which are visible in management’s operating style, how management assigns authority
and responsibility and how management organizes and develops its employees.
Another indication of the control environment is the degree of involvement from its
board of directors.
2. Risk Assessment: Risk assessment is the identification and analysis of internal and
external risks relevant to the achievement of objectives. A risk assessment forms a
basis for determining how risks should be managed. Assessments are a continuous
part of the internal control process because emerging economic, regulatory, political
and operating conditions will change the type of degree of risks faced by an
organisation.
3. Control Activities: Control activities are the policies and procedures and organisation
develops to ensure that management’s directives are carried out and objectives are
met. Control activities occur at all levels and in all functions within the organisation.
4. Information and Communication: Information systems produce reports with
internal and external financial, operational and compliance information that allows the
organisation to function. This information must flow up, down and across the
organisation for the control environment to remain strong.
5. Monitoring: The internal control system must be monitored for effective performance
over time and be evaluated periodically. Management and supervisors must constantly
assess actions taken by staff in performing their duties. A successful monitoring
activity is one that allows all serious matters to be reported to management in a timely
manner.
Service Delivery
Service delivery is a component of business that defines the interaction between
providers and clients where the provider offers a service, whether that be information or a
task and the client either finds value or loses value as a result. Good service delivery
provides clients with and increase in value.
Service delivery can be found in many different professions and company structures,
such as medical hospitals and IT companies and even in Insurance sectors.

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 Customer Experience including Insurance Claims
The claims process is a key part of the relational and customer experience of Property
& Casualty insurance company customers.
1. Life Insurance Claim Procedure:
a) Formalities for a death claim: When a person with a life insurance policy dies, a
claim intimation should be sent to the insurance company as early as possible. The
assignee or nominee under the policy can do this. The claim intimation should contain
information like the date, place and cause of death. The insurance agent has the duty to
help the life assured’s family/assignee to deal withs the insurance company to fulfil the
formalities for a claim.
The insurance company will respond to this intimation and will ask for the following
documents:
a) Filled-up claim form provided by the insurance company.
b) Certificate of death.
c) Policy document.
d) Deeds of assignments/re-assignments if any.
e) Legal evidence of title, if the policy is not assigned or nominated.
f) Form of discharge executed and witnesses.
Other documents such as medical attendant’s certificate, hospital certificate,
employer’s certificate, police inquest report, post mortem report etc could be called
for, as applicable.
b) Formalities for a maturity claim: Where a life insurance policy is maturing, the
insurance company will usually send intimation to the policyholder along with a discharge
voucher at least two to three months in advance of the date of maturity giving details like the
maturity amount payable.
The policyholder has to sign the discharge voucher which is like a receipt have his
signature witnessed and sent it back to the insurance company along with the original policy
bond to enable it to make the payment.
If the policy has been assigned in favour of any other person or entity like a housing
loan company the claim amount will be paid only to the assignee who will give the
discharge.
2. Formalities for a Health Insurance Claim: You can make a claim under a Health
Insurance Policy in two ways:
1. On a Cashless basis
2. A Reimbursement Claim
1. On a Cashless basis: For a claim on cashless basis, your treatment must be only at a
network hospital of the Third Party Administrator (TPA) who is servicing your policy. You

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have to seek authorisation for availing the treatment on a cashless basis as per procedures
laid down and in the prescribed form. Please read the policy document as soon as you receive
it to familiarise yourself with the process rather than wait for a claim to arise.
2. Claims on reimbursement basis: Read the clause relating to claims in your policy
document as soon as you receive it to ensure that you understand the procedure and the
documents required for making a claim on reimbursement basis. When a claim arises you
should inform the insurance company as per procedures required. After hospitalisation, you
have to ensure that you obtain and keep ready documents such as claim form, discharge
summary, prescriptions and bills that you should submit for a claim.
3. Formalities for a Motor Insurance Claim: A claim under a motor insurance policy could
be:
a) For personal injury or property damage related to someone else. This person is called
a third party in this context or
b) For damage to your own, insured, vehicle. This is called an own damage claim and
you are eligible for this if you are holding what is known as a package or a
comprehensive policy.
i. Third Party Claim: In a third party claim, where your vehicle is involved, it is
important to ensure that the accident is reported immediately to the police das well
as to the insurance company. On the other hand, if you are a victim, that is, if
somebody else’s vehicle was involved, you must obtain the insurance details of
that vehicle and make an intimation to the insurer of that vehicle.
ii. Own Damage Claim: In the event of an own damage claim, that is, where your
own vehicle is damaged due to an accident, you must immediately inform
insurance company and police, wherever required, to enable them to depute a
surveyor to assess the loss.
Do not attempt to move the vehicle from the accident spot without the permission of
police and the insurance company. Once you receive permission for removal of the vehicle
and for repairs, you can do so. If your policy provides for cashless service, which means you
do not have to pay out of your pocket for covered damages, the insurance company will pay
the workshop directly. In either of these situations, you must intimate the insurance company
immediately.
iii. Theft Claim: If vehicle is stolen, the person must inform the police and the
insurance company immediately. In addition you must keep the transport
department also informed. As soon as the policy document is required read about
the procedures and documentation requirements for claims rather than wait for a
claim to arise. There may be certain specific documentation requirements for
specific types of claims. For instance in respect of a theft claim, there is a special
requirement that you should surrender the vehicle keys to the insurance company.

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4. Formalities for making a Property Insurance Claim: There could be several types of
policies that cover property and the property itself could be stationery-like a building etc.
When you receive your policy familiarise with the documents required for a claim as well as
the procedures to be followed.
Whether or not a claim arises follow the various dos and don’ts in respect of property
for the duration of the policy. These dos and don’ts are termed warranties and conditions in
policy document.
In general, losses and damages, including those due to theft, fire and flood need be
intimated to the relevant authorities such as the police, the fire brigade and so on. It is
important to ensure that is intimate to insurance company to enable it to send a surveyor for
surveying and assessing the loss.
5. Formalities for making a Travel Insurance Claim: A travel insurance policy is
generally a package policy that includes different types of covers like hospitalisation,
personal accident, loss/damage to baggage, loss of passport and so on. The procedure and
documents required for a claim would vary from cover to cover. All of them would be
mentioned in policy document.
For ease of procedure and your convenience, insurers normally attach the claim form
with the policy document. This will contain the list of documents required in case of a claim
and also the contact details including phone numbers of the claims administrator either in the
destination country to which are travelling place or there in another country that is designated
to receive and process claim intimation.
Since this is a package policy with various covers and procedures it is very important
that you familiarise with the procedures and documentation in case of a claim.
Managing the Customer Relationship (Refer CRM concept in previous chapter)

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