'We Are Determined To Communicate Our Philosophy Through All Our Brand Platforms'

Vighnesh Shahane, CEO and Whole Time Director, IDBI Federal Life Insurance speaks to BW Businessworld on the company's focal areas for FY18, their formula for maximizing persistency, and the "uninsurance office" work environment that he's striving to foster

Congratulations on the completion of a successful financial year… What were some of your key business highlights for FY17? Are there any areas of your operations that would you like to improve this fiscal?
Thank you! With Rs 1,565 crore in total premium, the company registered 27 per cent growth against the last financial year. As an organisation, we have had one of the best years in eight years. This was a result of our focussed approach towards product mix, persistency and cost control.

Unlike the industry, we have a large chunk of our customers on our books even after five years. IDBI Federal still retains the crown for the lowest complaints ratio and top quartile persistency in the industry. Apart from top quartile persistency, lowest complaints ratios have all been great enablers in our business growth.

In FY18, we plan to strengthen some of the key areas like brand salience, technology & digitisation, distributor engagement and increasing unique lives. We would also focus on launching and strengthening the POS channel.

What are your strategic focal areas for FY18? Your business is a unique amalgamation between two banks… does that create a challenge in any way? Also, does that entail a different bancassurance strategy than what the industry traditionally follows?
The strategic focus areas would remain strengthening our brand positioning, distribution and digitisation. We will invest in technological solutions to improve front-end sales, distribution and customer service, and enhance back-end operational efficiency and expense management.

With regards to our brand positioning, we are determined to communicate our philosophy through all our brand platforms, initiatives and the communication. As a company, we firmly believe there is more to insurance than fear and intimidation.

IDBI Federal intends to show the world that with great health, adequate coverage and appropriate financial planning, one radiates vitalizing energy, the zest and gaiety of an inexhaustible joie de vivre.

This emotion is particularly captured in our purpose statement of "Empowering you to create the life and lifestyle of your choice." This will be showcased through our brand properties and everything we do.

On your question about the two banks- they have been a great reserve of distribution strength for our company over the years. Their strengths across different markets have actually helped us spread our distribution reach. So this model is our intrinsic strength and not a challenge in any way. Bancassurance has given us healthy business at a low cost over the years. While we follow the traditional bancassurance strategy, what is different here is the fact that, both IDBI Bank and Federal Banks are also promoters. They are far more involved in the business and are with us for a longer haul.

There have been talks of Ageas wanting to raise its stake in IDBI Federal. Do you see that materialising anytime soon? What role does Ageas play in your business… are they relatively passive, or are they actively involved in the business?
This is a decision of the shareholders and discussions are on. Ageas is completely involved at a strategic level. Ageas has been playing a pivotal and consultative role when it comes to sharing learnings from international markets and geographies.

Your 5th year persistency has been outstanding when compared to some of the larger insurers. How have you driven this? Is it not a challenge to drive a business goal that is essentially not immediately visible… and is influenced by multiple variables?
We have been able to retain this title for two years in a row now.

As an organisation, we have remained extremely people focused and customer-centric over the years. I personally believe that there is a space beyond digital disruption; that space it disruption through relationships. I have implored my team to seize that space and the results have been encouraging. It reflects in everything we do, be it our products, our service approach. Since most of our business comes through banks, we have aligned our offerings in line with what Bancassurance customers truly seek.

Pre Sales
From simple products to easy to understand product literature, we have taken all the rights steps to ensure appropriate pre-sales practices. Steps have been taken at New Business stage to get contact details of client like Mobile, telephone and email to facilitate reminders and improve contact ability during reminder calling. Pre sales and welcome calls are made to ensure the customer has understood all the product features.

Post sales
We have a unique concept known as Retention factory in our organisation. The Company has set up a dedicated team to focus on the efforts related to Persistency improvements. This team constantly introduces different solutions to improve persistency efforts. These include setting up of multi-lingual call centres, mobile app and avant-garde payment options for customers. This team is also responsible for introducing various campaigns to enable renewals of policies by customers. In order to strengthen the renewal collection, the Branch Operations teams are also involved in the renewal collection and follow-up. This ensures sales team is equally involved in the process. The company has also started a programme for distributors to educate them on the importance of renewal premiums and impact on fee income for distributors. In addition, we have also introduced analytics to have a segmented focus across customers, especially ones with low propensity to renew.

Do you think the industry needs to re-look at the way it compensates agents? Does the heavy front loading not create an obvious conflict of interest? It's obvious that smoothening the payout stream over a much longer period will align clients and sellers better. Why is this not happening?
The problem is not really of frontend commissions; it's about understanding how should the agents be suitably remunerated. One needs to understand that given the low awareness and understanding, life insurance still remains a push product. It requires tremendous efforts to help customers make the decision to enter into long-term contracts. This kind of effort deserves adequate front-end remuneration. This needs to be further followed up with smoothening the pay-outs over a longer period of time with emphasis on renewals. Only such an outlook will improve the quality of sales in the insurance industry.

Due to low commissions, we have lost a lot of talent to other vocations over a period of time and have seen the quality of sales decline. The talent exodus will continue if we do not strike a balance between effort versus remuneration and factor in rewards for customer stickiness. This paradigm shift in attitude will truly benefit both, end consumers as well as the agents.

What kind of work environment do you strive to foster at IDBI Federal? Do you lay emphasis on creating a work-life balance for your employees, or do you share Jack Welch's belief that "there's no such thing as work-life balance, there are only work-life choices for individuals to make themselves"?
The company is building a friendlier and approachable brand not only for its external customers but also for its internal audiences. To be future-ready, the company believes in transforming itself into a millennial-centric organisation. That's why at IDBI Federal Life Insurance, the work culture is built keeping the young employees in mind. So the next generation of leaders can live life just the way they want to. We like to address ourselves as Uninsurance office. We are a life insurance company but we don't operate like one.

Top 3 Things that make IDBI Federal Life Insurance the perfect uninsurance office are:

1. Work from home
To juggle personal and professional commitments, employees can work from home once every fortnight.

2. Dress down policy
Right from the dress code to our interactions we wish to inculcate an informal culture. This helps breaks silos and makes possible for ideas to travel faster across teams and hierarchies. We need more of this in today's time.

3. Flexi timing
To manage long commute distance and peak traffic hours, employees can choose to swipe in anytime between 8:00 am and 10:30 am.

On Work-life balance - I believe work life balance is an oft used, but highly misunderstood phrase. If you truly love your job and are passionate about it, you will automatically be able to strike a balance. Doing what you love reflects well on the other spheres of your life as well.

Lastly, what are some of IDBI Federal's planned initiatives on the digital side in the next 12 months? How do you plan to leverage technology to streamline your business?
Apart from working on the digital products, we would also continue to strengthen our IT framework. Some of our key focus areas remain Workflow Management Systems, Analytics, Sales Mobility and Fraud management. Chatbots and Blockchain are also the new buzzwords in technology and these will be explored in FY 2017-18 to further strengthen our customer service and processes.