The Government wants people to invest in mutual funds. Association of Mutual Funds in India (AMFI); educates citizens on the how’s and why’s of investing in mutual funds. AMFI started the highly successful campaign, Mutual Funds Sahi Hai’ in March 2017, to educate you and all citizens on mutual funds.
Now, IRDA or the Insurance Regulatory and Development Authority of India, wants to educate the people of India on the benefits of insurance plans. It is taking a leaf out of AMFI’s book and would soon launch the Mega Awareness Campaign, ‘Insurance Sahi Hai’. The ‘Insurance Sahi Hai’ campaign will educate the citizens of India on the importance of an insurance plan from October 2019. The ‘Insurance Sahi Hai’ is a mass campaign across channels like TV, Digital and even outdoor.
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Insurance Sahi Hai is the most costly awareness campaign, ever launched in the insurance industry. It has a whopping budget of Rs 100 Crores. Insurance will be a pull and not a push product in India. Life Insurance Corporation or LIC will contribute the bulk of the amount.
Insurance has always been a push product in India. It is not very popular and is availed just for tax benefits. So what is a push and pull product? A push strategy uses marketing channels like trade promotions to push a product. Pull marketing draws customers to a brand through non-intrusive methods like SEO or search engine optimization.
See Also: What Is Health Insurance?
Don’t have an insurance plan? Well, you are not alone. The insurance penetration in India is just 3.69%. Insurance penetration is nothing but the percentage of insurance premium to GDP.
Let’s take a look at the life insurance penetration in India. Life Insurance Penetration was 2.15% in 2001 and went up to 4.6% in 2009. It then fell to 2.76% in 2017. This shows that people were not keen on life insurance plans in this period.
Insurance density is the ratio of insurance premium to population. The insurance density of the life insurance sector in India was $9.1 in 2001 and reached a peak of $55.7 in 2010. The insurance density fell after this to reach $46.5 in 2016.
So what do you understand? Well, insurance penetration and insurance density have both gone down in the last decade. India badly needs an Insurance Sahi Hai campaign.
India’s insurance density was $73 in FY2017-2018. The global insurance density was $850 in this period. The average among Asian peers was $360.
Cayman Islands had an insurance density of $12,122 in 2017 and Hong Kong an insurance density of $8,313 which was the second-highest in the World.
See Also: History of Health Insurance in India
For the first time in its history, IRDA turned to radio stations to promote insurance in India in 2017. IRDA launched insurance awareness programs through radio jingles for 6 months. IRDA used All India Radio (AIR) and private radio channels like Fever 104, Suryan FM, RED FM, Radio City and Radio Mirchi to play advertisements in towns and small cities. The program was run in different languages like Hindi, Tamil, Telugu, Malayalam and Kannada.
IRDA runs campaigns like TV campaigns alerting customers on insurance scams which claim to offer bonuses from IRDA. IRDA is the insurance regulator and doesn’t offer bonuses on life insurance plans.
The radio jingles cover life insurance, motor and home insurance and even health insurance. Topics touched are misselling and renewal of insurance plans. Radio jingles warn customers to take a look at policy documents before availing the plan.
Radio jingles are broadcast in the early morning and late evenings. This is the time people are free from daily work or are commuting from home to office or back. They would tune in to radio channels.
AMFI ran the highly successful campaign Mutual Funds Sahi Hai. More than 32 Lakh investors were added between March 2017 to April 2018.
The main intention of AMFI was to promote mutual funds in India. All financial sectors joined together to promote mutual funds in India.
IRDA will run the Insurance Sahi Hai campaign on similar lines. The focus would be:
Why you need insurance?
More about insurance plans?
How insurance benefits you and so on.
See Also: Health Insurance Plans
Insurance Sahi Hai would focus on life insurance, especially term life insurance plans. These are pure risk protection plans. People avail insurance for tax benefits and not for risk protection.
The Government wants people to avail pure risk protection plans like term life plans. The life insurer pays the sum assured called death benefit to the policyholder’s family, if he dies within the term of the plan. There are no survival benefits. Term life plans are a must and you must never mix insurance with savings or investments. You also need a health insurance plan to meet costly emergency hospitalization.
Comprehensive motor insurance protects from costly repairs if the car/vehicle is damaged in an accident. Third party liability plan compensates an unrelated third party on life lost or property damage in an accident in which you were involved. Householders package policy protects the structure of your house and contents from damage due to natural calamities, fire and allied perils, theft and burglary.
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