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What is the better distribution channel for Indian life insurance industry in the long run???

Created by : SHARATH CHANDAR REDDY, Business Development Manager - Insurance, I T C Ltd  | 09 23 2009 18:51:06 +0000
Industry : InsuranceFunctional Area : Business Models(Strategy & Execution)
Keywords : life insurance agency bancassurance alternate channel insurance distribution
Activity:  1323 views;  last activity : 07 06 2010 20:18:09 +0000

For a long time the Traditional agency model pioneered by LIC has been the driver of indian life insurance industry. After the privatisation, along with the agency channel, many other channels have emerged. The list of Alternate channels includes bancassurance, the franchisee model (BA, BP, CDA, etc), Third party distribution (Corporate agents, brokers, etc). Still the traditional agency model is the leader....

What is the better distribution channel considering the factors like financial viability, market share, customer satisfaction, persistency....

  
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Traditional Agency model Vs Alternate channels
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i don't think alternate channels are that much good...even if we use them, still there will be a need for individuals for running the alternate channels..Wherein traditional channels there are face-to-face approach to the clients...
By Sallu Shaikh, B.Com student, KET's V.G.Vaze College  | 02 28 2010 09:35:31 +0000
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In the long run, traditional agency model gives a pretty stronger base for the life insurance company. Considering the fact that life insurance business is done more on the basis of the traditional relationships than on the basis of commercial/data based relationships, this model is a better one from the view points of market share, customer contact and persistency. If it is managed with proper financial & marketing discipline, it will be financially viable too.

The pioneering success of LIC and many leading private insurers with this model is a testimony, though it may be an early conclusion. 
By SHARATH CHANDAR REDDY, Business Development Manager - Insurance, I T C Ltd  | 09 23 2009 18:51:06 +0000
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Traditional agency model has been the main area of business for the insurance companies so far, but in the current situation it is the alternate that is reaching to ever corner without making companies to make invest regarding infrastructure. This is benificial for both the company and the customer.
By Zahoor Ahmad Baba, Relationship Manager, Bajaj Allianz  | 09 25 2009 17:06:15 +0000
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Now Insurance Industry is cut throat competition in India. So, it should divert their sales channels from Traditional to Alternate. Because as people are becoming more aware & educated regarding Insurance & understand the importance of Life Insurance hence company should go for customize & efficient service to their customers through alternate channels
By prakashraj kumavat, MBA/PGDM student, Omegan School of Business (ICFAI Tripura)  | 09 24 2009 06:09:01 +0000
Argue for "Traditional Agency model"
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