Life Insurance Combines Long-term Savings, Protection & Tax Benefits: Rushabh Gandhi, IndiaFirst Life

What are some significant market trends currently affecting the life insurance industry, particularly in terms of commissions and distribution?
The evolving landscape of expense of management (EOM) and its impact on commission rates, is one of the significant market trends we’ve witnessed. The regulation surrounding commission rates has triggered a push and pull between insurers, distributors, and customers. While there's anticipation that commissions may decrease in the long term, in the short run, some product lines have seen commission increases. The industry has, in the past, found equilibrium and will find the right balance this time too.

Another key one is “Insurance for all by 2047”. Regulatory initiatives are focused on expanding insurance coverage to reach the entire population by 2047. This goal has led to various developmental initiatives aimed at enhancing insurance penetration, including the introduction of composite products combining life, health, and personal accident insurance. Bima Vistaar and Bima Vahak initiatives are meant to facilitate the goal of insurance for all. They involve the introduction of insurance products with affordable pricing, simplified terms, and an array of benefits. 

The benefits of these and many other initiatives, once fructified, will help the country achieve its long-term insurance goals.

Can you explain the provisions or plans implemented by IndiaFirst Life Insurance for underserved communities?
IndiaFirst Life has launched innovative initiatives and product customisations to effectively serve underserved communities. One notable offering is the "Insurance Khata," a product designed for rural India. It features single premiums and continues coverage even if the second-year premium is not paid. Premiums are affordable and can start as low as Rs 100. The product is designed to be simple, lapse-free, and aims to meet the unique needs of rural customers. Additionally, policy documents and literature are provided in local languages, further customising the offerings for specific markets. Investing in a life insurance cover to have financial protection for your loved ones is a celebration to mitigate ambiguities of life. 

How has IndiaFirst Life embraced technology to enhance customer services and operational efficiency?IndiaFirst Life has embraced technology to improve operational efficiency and enhance customer services. We’ve significantly transitioned our business processes to online medium, thereby reducing the need for physical application forms. This includes premium payments through direct debits and renewals, which simplify the customer experience. The company has also developed chatbots like "Iris" for customer queries and has extended its query resolution capabilities to WhatsApp. Moreover, IndiaFirst Life is continuously investing in technology, adopting artificial intelligence, and introducing initiatives like "instant issuance" to speed up policy underwriting. The aim is to increase efficiency, improve penetration, and make insurance more accessible to underserved markets.

Have you introduced any festival-specific life insurance products recently or considered launching such products for cultural festivals or traditions?
Festive life insurance is an interesting idea that we plan to explore in times to come. Recently, we launched Guarantee of Life Dreams (G.O.L.D.) plan in August. The non-linked, non-participating, individual life insurance plan is designed to provide policyholders with a regular long-term income option. Going beyond traditional insurance, G.O.L.D. will empower our customers to plan a long-term income as per their needs. Unlike most other plans where returns are received after a few years, the highlight of this product is that one can plan to receive future income from the end of the first month itself. This, along with its other features is expected to make G.O.L.D. a compelling proposition for customers who want a guaranteed tax-free income as a holistic solution to their insurance and investment needs. 

Can you share details about any recent product launches or marketing campaigns that IndiaFirst Life Insurance has undertaken?
We recently launched a product called the Guaranteed Single Premium Plan (GSPP), offering high guarantees for various terms. Our marketing campaign for GSPP focused on the concept of a 7X or seven times return guarantee, aiming to attract customers looking for guaranteed returns over an extended period. Our marketing strategies included advertising through hoardings, social media, regional press, and prominent mainline & financial dailies. 

How do insurance companies inform customers and stakeholders about new regulatory changes and what initiatives have been taken to enhance insurance awareness?
Insurance companies run awareness campaigns for customers and communicate with stakeholders including distributors to keep them informed about regulatory changes. The awareness campaigns are typically filed with the regulator. In addition, insurance companies are adopting State Insurance Plans (SIP) to take charge of one or two states along with the government of that state. The focus is to increase awareness and understanding of insurance in those regions. The regulator's developmental efforts, including the SIP initiative, will help enhance insurance awareness, educate policyholders about their benefits and responsibilities, and ensure that customers are informed about regulatory changes that may be applicable to them.

How have you improved its market presence through marketing efforts?
We track and enhance our top-of-mind awareness (TOM) and spontaneous recall among potential customers to strengthen our market presence. Traditionally, organisations focussed on maximising brand visibility and increasing brand recall simply through ATL engagements. Today, customers are evolved and interested in engaging only on their terms - from a qualitative, quantitative, and value proposition standpoint. IndiaFirst Life has opted for the hyper-personalisation route to provide a useful, usable, desirable, and differentiated experience to its customers.

What is the impact of the Union Budget provisions that make insurance proceeds on premiums exceeding Rs 5,00,000 per annum taxable?
We believe that life insurance is the only instrument which provides long-term savings as well as life insurance protection and thus, should have the benefit of tax to promote the culture of savings and protection.

However, the impact of these provisions on IndiaFirst Life is relatively low. Cases falling under this category represent less than one per cent of our total number of policies and about four per cent of our total premiums.

How are insurance companies addressing sustainability and ESG (Environmental, Social, and Governance) concerns?
Our approach to ESG is best reflected in our brand promise of "Securing Lives, Creating Value". Value creation is across stakeholders whilst retaining our business goals. We have a board-approved ESG policy and have created a work plan based on a Materiality assessment done recently. The work plan includes the creation of a "Circle of Trust" program, which aims at building trust across stakeholders. PMJJBY and our suite of micro products touch the lives of over a crore customers largely in the hinterland. We practice good governance, which is guided by an experienced set of diverse professionals on our board through structured Board committees and Subcommittees for different aspects of the business. This is implemented through a set of board-approved policies and SOPs which reviewed annually. Our biggest office is in a ‘Green Building’ and we are working on a goal to turn carbon neutral.

How do you see the importance of ESG in the future?
No doubt that ESG is the future. My son, who is completing his engineering, is focused on ESG in his job search. Every company will need to take significant action in this area, not just as lip service but as substantial efforts, and this is becoming increasingly important across industries. ESG will become a way of life and enshrined in the organisational strategy gradually.