Preamble:- In spite of strongly protest of their individual
agents regarding online sale of life insurance products through website, LIC has
launched the same in current financial year. Many people are still not able to
understand why LIC start this, while it is fact that they have good number of
working Agents. If we go behind 5 to 6 years back LIC always spoke that they believe
only one mode sale which is very effective and trustable i.e. insurance advisors.
Can we understand it, that now LIC agent is not effective, so LIC diverted
their marketing route through online. There may be many reasons, let’s try to
find out the exact cause behind this.
LIC Agents: - The footing of LIC stands on Agents and we always
listen this in media and by their top executives. The glorious 58 years of LIC
journey and their each moment made special by their Agents. Let’s see why we
always listen LIC footing stands on Agents, please see following picture.
If we see
above picture, we found that 21.23 lacs Agents working in Life Insurance Sector
and out of that 55% i.e. 11.73 Lacs working with LIC of India alone and rest 35%
i.e. 9.50 lacs Agents working with other 23 Life Insurance Companies. The 41
thousands Agents average per Life Insurance Company working, while LIC have
11.73 lacs Agents alone. It’s make LIC biggest player in the life insurance sector.
This is the basic reason why LIC market share is best and their reaches are all
corner of the country. This is also reason why private player struggling for
handsome market share. Whenever they will reach the level of Agents as equal to
LIC, then they can show extraordinary performance.
Why LIC
entered into online sale: -
LIC of India entered into online sale from current financial year, in spite of protest
from their internal Agents. Before writing any reason you need to see following
picture that is showing status of life insurance industry. This is based on latest
available data and this data taken from Insurance Regulatory and Development Authority.
This data
clearly indicates that individual Agents losing their charms. The whole life
insurance industry is witness that in their overall sales approximately 40%
business comes from direct selling. This is the sufficient reason why LIC
entered into this segment. At this time LIC of India have two products which
are selling through online i.e. LIC’s e-term
and LIC’s Jeevan Akshay VI.
LIC
Decision right or wrong: - Every
life insurance player coming into the sector to spread life insurance business
and get maximum advantages/benefits, LIC one of them. After Agents, direct sale
channel is second largest channel which is producing good business. Direct selling
also in the benefits of the customer, if you take policy from Agents the some
portion of your premium goes to Agents in the form of commission while by
direct sale your commission portion saved and you will be benefited. Your premium
may be less as compared to policy buying through Agents. This is the main
reason why Agents protesting this activity of LIC.
Looking to
the interest of LIC their Customers and awareness under the general public of India
about life insurance the decision of LIC to enter into online sale is really
appreciable. If LIC not entered in this segment, private player will take its
advantages and they will give tough competition to LIC. For LIC it was necessary
to came in this segment and save their place amongst life insurance players.
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