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Insurance In The Time Of ‘Home Economy’

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Ruchika Varma, CMO, Future Generali India Insurance lists down mantras of what it will take for brands in General Insurance to win in the time of Covid-19

Coronavirus is not just a health crisis; it is a black swan event with wide implications across multiple dimensions. These implications are not just limited to loss of human life, severe economic contraction on a global basis & restructuring of businesses but also reshaping of intrinsic human behaviour and consumer preferences.

Indians by nature are savers (we have among the highest savings rate in the world). We save for a rainy day, accumulate wealth, are industrious and hardworking. We invest in low-yield but safe products like FDs, life insurance endowment and money back plans. But oddly, we don’t spend money on protection.  Health Insurance, a product which has almost guaranteed usability in urban India, has sadly always been characterised by low penetration and limited demand.

The Covid-19 situation has turned this on its head. People are slowly waking up to the realisation that their health is also an asset that needs financial protection. While there is a positive inclination for health insurance, demand for the largest selling product in the general insurance industry i.e motor insurance is declining. Travel insurance, typically a high growth product, is non- existent. Consumer behaviour is changing and is reshaping the future of insurance.

In this new reality, what will make general insurance brands win in the market-place? Here are some mantras that I believe will help brands get sustainable competitive advantage in the new normal

  • Adaptability: Throw out the marketing plan that you had made in the beginning of the year and re-assess the reality. In today’s home economy, consumers are forced to choose needs over wants. Understand the new needs and address them –whether it is through new value propositions, digital platforms for purchase/renewals or uninterrupted consumer service.

There is a need to re-assess media plans. Social Distancing has led to online social connectivity. Visits to social media sites have increased by 19%, with a high increase even for those above 35 years. Facebook and WhatsApp continue their domination but platforms like ByteDance and TikTok are not far behind. There is 32% growth in visits to news sites, 11% growth in visits to health sites, digital consumption on mobile phones have increased by three hours, online gaming is seeing a 49% increase in total minutes spent. The implications for Insurance brands? Realign media and partnership plans to reflect these shifts in consumer behaviour.

  • Digital Disruption: Today’s home economy is ruled by Fintech, Edtech, digital gaming, online fitness & digital meetings. Insurance brands have to re-invent themselves to find a place in this new digital world. Digitisation of the sales process is just the starting point. There is a great opportunity for brands to arm agents with the right tools to enable digital prospecting, and ensuring agents get their voice heard even when they can’t meet customers face-to-face. Deployment of AI and machine learning to ‘predict and prevent’ rather than just ‘detect and repair’ will give long tail benefits.
  • Agility: Speed to market is key. At Future Generali, our business continuity plan consisting of initiatives across digitisation of the sales process, remote technology that allows for employees (including our call centres) to work from home & enhancement of customer digital journeys; were all put in place much before the government announced the lockdown. This allowed us to respond to our consumers when they needed us most.
  • Empathy: Brands will lose out if they are seen as opportunistic during this time. Brands that genuinely listen, are reachable & go the extra mile to solve customer issues will win. Insurance, traditionally seen as an industry thriving on fear psychosis will have to find a way to have a positive conversation with consumers & create contextual marketing messages that emotionally resonate with the consumers. Brands which are empathetic & have stood by the consumers during this time will gain trust and will prevent loyalty shifts later.
  • Innovation: The Covid-19 situation has brought new risks for consumers to the fore. People are looking for insurance protection against coronavirus. They are worried about losing their jobs. There are concerns over data security. There is a huge opportunity for brands to develop category-breaking, disruptive propositions that address these concerns. Brands that does this well will firmly get positioned as innovative & clutter-breaking and this will allow them to break the chain of predatory pricing, a malaise the industry is struggling with today.

We all know the world will never be the same again. Brands that embrace this, redefine their marketing strategies accordingly and consistently address consumer needs will create preference for themselves in this new world.

About the author / 

Ruchika Varma

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