sm project[1]
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8/6/2019 SM Project[1]
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Life Insurance Industry
MNYL Vs Industry
Value Chain Analysis
Prepared by
Abhishek Kumar Roll No 1
Sakshi Grover Roll No 39
Samarth Gupta Roll No 40
Shruti Kumar Roll No 47
Vinay Kumar Roll No 62
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Industry Analysis
y Dominant Player LIC
y Regulatory Body IRDA
y FDI route opened in 1999
y No. of Pvt. Players 23y Indian Market Nascent Stage
y Average Break Even Point 10 years
y Nature of Business Highly Capital Intensive
y Current Category Penetration XX %
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Business Models
Agency Model: Brick and Mortar Model/ DSTy Self Managed Branch Offices Better Customer Service / Better
Accessibility
y HighFixed Cost
y LIC / MNYL /Aviva
Bancassurance :y Operations through Banca infrastructure
y ICICI Pru / HDFC Life / Canara HSBC Oriental Life
Brokers / Strategic Alliances:y StrategicAlliance :Amway (Amsure)
y Broker: India Infoline, Peerless, Indiabulls, Karvy Brokers, Religare etc
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UpcomingBusiness Model
y Online:
y Paperless and cheapest way for Consumer as well as company
y Most reliable as only educated class is active in this space
y Still at its nascent stage
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Factors that drive the purchase
behaviour
y Trust
y Purchase Exp
y Premium Payment
y
Quality ofA
gent'sA
dvisey Product Portfolio
y Call Centre
y Accessibility
y
Brand Recally Online Presence
y Claim Settlement
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Value Curve (Option 1)
0
2
4
6
8
10
12
LIC
ICICI Pru
MNYL
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Value Curve (Option 2)
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Four Action Framework
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Reduce
No.OfOffices:
y Reduction in fixed costs
y Benefits can be passed on to the customer by lesser charges
y
Bancassurance /Other strategic alliances tie up:
y Arrangements with retain chains for premium payment
y Tie Ups withDiagnostic Centres
y Contract with agencies : Feet on Street (FOS) in various cities
y Improve Processes: Get maximum customers active into ECS
(Electronic Clearance System) mode
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RaiseBrand Recall
y Appropriate customer communication
y Differentiation in brand image
y Brand Track
y Effective Campaigns
Quality ofAgentsAdvise
y CompetitiveAdvantage
y Invest in Training
y Provide career path toAgentAdvisors
y Build Sales Force for maximum coverage
y Empower them with effective Sales Tools
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Raise Contd..
y Premium Payment Options
y Tie Ups with retain chains
y Tie ups withAgencies (providing cheque pick up facility
through their FOS
y Drop Boxes
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Eliminate
y Non Value Added (NVA)Activities
y Outsourcing customer services (front end & back end)
y Better services
y Cost efficiency
y h
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Createy Trust
y ThroughTVC and other modes of communicationy Leverage on Quality ofAgentsAdvise Word of MouthAdvertising works
effectively in the industryy Leverage on its claims efficiencies
y Online Presencey Look across the time horizon The future lies here
y Focus only to Mass and Mass Affluent (Blue Ocean)y 80% of the Business is realized by 20% of peopley Retention Programme High acquisition costsy Focus On Group Business (B2B)y No focus on rural market (lower ticket size but high fixed costs)
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Create Contd..
y Clear focus onTraditional Life Insurance Products
(Blue Ocean)
y People still apprehensive of market volatility
y People prefer products that offer guaranteed returns
y Higher persistency and business conservation two key
parameters
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New Value Curve
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Thank You
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