Is rural sector a market for Insurance

Yes, I agree. There is a huge potential for growth of the insurance sector in the rural areas. This is because the awareness about the insurance products is picking in the rural areas thanks to the advertising that the insurance companies do in these areas and also the rural peoples appetite for safer investments with guaranteed returns. So, in the years to come we can expect a high growth of insurance policy holders across the rural sector.

I strongly agree with your statement becuase rural market is only potential market for Insurnace companies. But for that insurance companies has to educate and aware the people regarding insurance the need of insurance & its importance in their life. As urban market is getting saturation in insurance market so its a golden opportunity for insurance company to enter into rural market. 

Yes i do agree that the rural sector is a good market for insurance.

because if we look at the insurance penetration in the rural india , it is very low, people have got no insurance, the only way they invest is either in gold or land, they are not much aware of these options.

There are so many opportunities in the rural area, also less competition.

Yes, In Rural Sector the market for insurance is good in the present condition because technolgy has taken place every where so i don't think that the companies will be having any difficulties for acquiring premiums. And our litrecy rate is also increaseing day by day and the matter concern about is life covering is than that is very important for villegers So it' a good market for insurance companies in Rural Sector. 

Yes there is huge untapped potential, but you need a different set of products and strategies. Go for low cost less complex plans and try taking advantage of already established channels, like bank assurance, selling through panchayats and other government bodies (rural areas - cost is a huge factor). Insurance is highly relevant for agriculture, only thing that there is very little awareness. Companies Like “rural insurance” are dedicated to rurally based business and agriculture.

i do agree with the view that rural india has great potential . in rural india only one name exist and that is LIC .people in rural area's trust only on LIC. So first of all we need to make them believe .there is lot of other companies exist who are providing good service and product offering.in rural india people normally invest their money into KVP's ,post office bonds,in banks.so we need to guide them to look beyond these sources. because they can earn more .and get secured with insurance.

Definitely But the valuation has to be right and one should not expect the volume as that of urban market. Then one can definitely see the sign of success. Whe i say valuation. It should understand credit value, risk associated, medical risk etc too.

I agree with the view of Mr.Banga, because there is  huge market for life insurance in rural area. As per My knowledgemore than70% market is untap.

Well,Ish Kumar Ji i cannot agree with you more.In my view rural market is the biggest market for our insurance companies in india because of their lack of penetration and also because of the increased awareness among rural people of the benefits of having insurance.But you said that they are also interested in having ULIPs plans but what i have experienced is that they hesitate a little bit for this because ULIP is more of an investment insurance plan and customer is not sure of the exact amount that he will get at the maturity.

What would you say?

Mr.Nikhil i somewhat not agree to your point.You said that there is more exposure of insurance companies in the developed or urban part of india but if they want to increase their base in the rural india also then they can surely do that.Only when you take a first step you come to know the path ahead.

And i firmly believe that rural india can be the biggest market for insurance companies.

what do you say?

Sorry to say my friend..but i don't agree with your point regarding no relevance of insurance as a tax saving tool in rural areas becuase now a days most of the rural areas has school and other small govt establishments. And all the guys working there are govt employee and after the sixth pay commission they are fatching fair amount of salaries. So ofcourse they are too, buying insurance. I again support the argument that rural area will be the next driver of growth in insurance sector as most of the urban and semi urban areas are coming to saturaiton point. I hope we ll see the telecom revolution kind of story in Indian Insurance sector soon.

My vote goes for YES.

Rural sector is a great market for Insurance because of variety of insurance products can be offered rural flok than urban flok.

Since the benefits of insurance have reached only a very few in the rural areas. Insurance companies can take advantage of it by telling them the benefit of various insurance products. And I am sure that they will be ready to lend their ears and listen to you.

Yes it is... Its not that rural is only meant for  insurance products relating to life, sickness and livestock. One should be aware that there is an array of excellent insurance products, which are rural–friendly, and of much significance to them like policies specially designed for women, farmers’ package policies, policies to protect children, personal accident policies, mediclaim and hospitalization policies, road safety policy, student safety insurance, householders policy, etc

Best market for an insurance company to target.

Let me sight a a statics FMCG consumption pattern in rural areas

1. Skin care product 26.3% by vol as compared to 12.5% by volume in Urban areas

2. Hair Oils:- 19.1% by vol. in Rural areas as compared to 11.4% by vol. in Urban areas

3. Candies:- 26.5% by vol. in rural areas as compared to 3.6% by vol. in Urban areas

A few other statics are as follows

1. Lower Middle class residing in Rural Areas constitutes 41% of the Indian Middle Class Population

2. Lower middle class constitutes to 58% of the total disposable income

3. This class constitutes 70% of the total household in rural areas.

4. The Lower Middle class population is expected to rise to 153 million in 09-10 as compared to 135 million in 01-02.

The rural story has remained intact inspite of burnout and lack of demand for goods and services in urban areas in the present day scenario.

So now it is upto the insurers to understand needs wants demands and also importantly understand the pricing mechanism to cater the rural populace.

Till now all the insurance companies have believed and hence have designed products with the underlying thought that "One size fits all".

If we want to grow then we need to go to place where the massess reside and provide them with those insurance products that meets their need.

Yes,, all companies will face severe problems because of mis selling,, particularly ULIPS.

Fully agreed to Jitesh but only one important point to add that in rural market mis_sale will be major challenge for companies. So they require to put stringent norms to tackel same.

I agree with ish kumar and like to give an example for it.Leading private insurance company, ICICI Prudential Life Insurance has identified India’s rural areas as the next big opportunity and proposes to further stregthen its presence in the villages.o tap the rural market, the company has developed a multi channel distribution network to increase touch points. It has established 260 micro offices in tehsils and districts across key states, appointed over 20,000 advisors dedicated to the rural segment and has tied up with leading Regional Rural Banks, Micro Finance Institutions (MFI)s and NGOs.The company has also created a strong service infrastructure to ensure that the rural customer enjoys the highest level of service experience.The insurance companies definitely believe that there is a huge untapped rural market which can be explored.

Demand of today is to penetrate insurance in rural sector, as 65% of Indian population belongs to rural. Longitivity and success of any company depends who hits the rural market first. Be it HUL, Pepsi and coke they have specially targeted rural segment and they have performed exceptionally well.

ICICI prudential has also pioneered in this segment, last year we have started rural channel and till date we have done 1100 + micro offices in rural area operational. And if you talk in terms of business prospective they are much more than expectation in this recession scenario.

Being responsible for developing rural channel in Punjab, we have operationalised 120 micro offices in rural areas with 7000 + Insurance advisors.

 So I think rural is an good option, which will be cost effective and profitable in this down market scenario

Dear all if you guys are having plans to invest your resources in rural India take it from me its the right decision. The earlier you enter the better it is. Believe me or not with my past experience in implementing targeted health insurance scheme at a state level, I have found its potential. We have to slog initially to attract investment but later it’s a win win situation once they understand its importance and benefits. Also like to add there a steady income source and most of rural populations saves more than your exisiting customer base. Its only how deep you want to travel.

I believe its one of the trickiest because it differs with the geograhy. Rural sector in Gujarat is different than Orissa. Further, yet it is not the establish fact that rural market works hence there is no evidence.

But potential is huge. We need to identify and test ways to tap it.

Thats the sliver lining, no doubts about that the only concern being misselling.

yes, they are open to insurance mainly as savings tool.

People in rural areas are more feeded up these days, thanks to media & print industry. They know the imp. of insu. & are ready to accept it with open heart.

Yes, it is possible to sell insurance to rural populance as many of them stay in the rural part of the city and work in the city and are better off than many of the city dwellers. The only problem is that the company selling the insurance should make sure that the product should be rural centric and the premium payability is available in and around the rural area. The person/advisor should be well-versed with needs of the people and should be in a position to convert the features into advantages for the rural folks.

I think companies have now already started moving towards rural sector. People are ready to get insured for price range for Rs 2000-Rs 3500 according to the information of IRDA.