How to change the perception of customers from insurance to investment..??

the consumer psychology is such an undefinable thing.to change his/her perception we would have to educate them  the through agents and media.this can be done by making insurance mandatory for all individuals...

I think its just 8-10 month back story when everybody fighting for changing customer preception from investment to insurance and now its change just opposite its all due to market.

But yes definately we can change preception of customer from insurance to investment or investment to insurance by doing proper genuine need analysis of client . and its done

Hi, I am sorry to say that Insurance is NOT an INVESTMENT but a way to reduce RISK of an Investment/Cash-flow.Insurance for tax-saving reasons underplay the basic concept of Insurance which is to ensure cashflow in the event of loss of the bread-butter earner of the family (life ensurance) or any financial asset. The mixed version of insurance with endowment/money-back is like Pizza-base(pure insurance) and adding various flavours like onion or chease making Onion or Chease Pizza.Conflict of interest of insurance agents and ignorance of customers always give rise to sell/buy insurance without proper analysis of one's risk of cashflow and cumbersome approach of insurance co. is also to blame for use of complex terms like Underwriting,ULIPS and many other terms to a layman customer. Simplification of these terminology alongwith customer education drive on national level may help.

Insurance and Investment are two totally different things and should never be compared with each other.

Therefore, all of us from the insurance industry should come to terms with this and stop comparing insurance with investment.

Insurance companies should take all the efforts to make people aware about the products and benefits. They can spread awareness by organising various camps, sending mails or through free counselling for interested people.

I think this will help because most of the people are not aware about the inestment benefits of insurance in product like ULIP. To understand ULIP a person should be aware of how the share market works, so only awareness can change perception......

Like in case of Derivatives, Life Insurance should be just that - (i) a cover for unanticipated demise of the breadearner. (ii) it has to address the financial gap that arises on account of event (i) and (iii) in case of loans taken for assets, to cover the outstanding so that the family could retain the asset.

In practice, Insurance Advisors/Agents show little interest in pushing Pure Insurance products. Notwithstanding the wealth of information available on the web, the Insurance Advisors still play the crucial role in educating 98% of potential customers. This lack of enthusiaism appears to be on account of less incentive paid by the Insurance Companies as compared to the Investment packaged Insurance products.

Of course, the "greed factor" does play a critical role. As everyone worth his salt was looking the other way till the US Economy went into a near comatose and Banks and other FIS were declaring fantasitc returns, dividends and bonuses, the extent of leveraging is completely overlooked and becomes too complicated. Likewise, the Indian consumer also falls into the trap when he is told that a Pure Insurance product yields zero return upon survival of the PolicyHolder as on the date of maturiy. On the contrary, expensive packages like Moneyback Plans become the flavor of the day.

If IRDA can make it mandatory for Insurance Companies to provide a split of the Mortality Risk Premium and the other components of the Premium for each element of the package, the dame will become quite transparent. Moreover, how Investment decisons are taken by an Insurance Company or a Portfolio Manager/MF should also get published regularly.      

Like in case of Derivatives, Life Insurance should be just that - (i) a cover for unanticipated demise of the breadearner. (ii) it has to address the financial gap that arises on account of event (i) and (iii) in case of loans taken for assets, to cover the outstanding so that the family could retain the asset.

In practice, Insurance Advisors/Agents show little interest in pushing Pure Insurance products. Notwithstanding the wealth of information available on the web, the Insurance Advisors still play the crucial role in educating 98% of potential customers. This lack of enthusiaism appears to be on account of less incentive paid by the Insurance Companies as compared to the Investment packaged Insurance products.

Of course, the "greed factor" does play a critical role. As everyone worth his salt was looking the other way till the US Economy went into a near comatose and Banks and other FIS were declaring fantasitc returns, dividends and bonuses, the extent of leveraging is completely overlooked and becomes too complicated. Likewise, the Indian consumer also falls into the trap when he is told that a Pure Insurance product yields zero return upon survival of the PolicyHolder as on the date of maturiy. On the contrary, expensive packages like Moneyback Plans become the flavor of the day.

If IRDA can make it mandatory for Insurance Companies to provide a split of the Mortality Risk Premium and the other components of the Premium for each element of the package, the dame will become quite transparent. Moreover, how Investment decisons are taken by an Insurance Company or a Portfolio Manager/MF should also get published regularly.      

Hi Jitesh,

We can not change customer perception about insurance overnight. There is a need from the company side to be as clear as possibl in their plans or products. And the advisor should also be transparent in his dealings and explanation. He should not try to close the deal by doing something on his own and and telling it to the customer. Because if you will be transparent in your work ethics than customer perception will change and their confidence will grow. afterall it is the customer who is going to be affected by your deeds. So his interest should be paramount in your mind.

Best Regards

I think its just 8-10 month back story when everybody fighting for changing customer preception from investment to insurance and now its change just opposite its all due to market.

But yes definately we can change preception of customer from insurance to investment or investment to insurance by doing proper genuine need analysis of client . and its done