Health is wealth - and that's certainly the case for Indian life insurers. Nearly 40 days after their entry into the long-term unit-linked health insurance business, the two life insurers - Life Insurance Corporation of India (LIC) and Reliance Life Insurance Company Limited - have been logging good business.
The Asian insurance giant LIC averages around 1,200 policies per day.
"We have earned around Rs.520 million till date. We are confident of closing this year with a premium of Rs.4 billion from our unit-linked long-term health insurance policy Health Plus," D.D. Singh, executive director (Health), LIC, told IANS.
According to him, LIC has sold 50,000 policies till date at an average premium of around Rs.10,000 per policy.
Given the poor penetration of health insurance products achieved by the 13 non-life insurers in India, LIC's achievement is quite commendable.
Pleased with the positive response received from LIC's strong agency force for the product, Singh said, "Our agents have understood this product well and that is reflected in the sales numbers."
However the process of selling this product is different from selling other life insurance policies.
Talking about his experience in selling Health Plus, A Suresh Kumar Oza, an LIC agent, said, "It takes more time to educate a prospect on the policy features and how it works. They are more conversant with the traditional mediclaim insurance sold by non-life insurers."
"Long-term unit-linked health insurance cannot be sold as easily as any other unit-linked life insurance policy or traditional endowment or money back policies as a tax saving product," he added.
That apart, the necessity of submitting photographs for the issuance of identity cards and medical reports delay enrolment in the scheme.
A combination of all these factors plus the absence of clarity on the income tax rebate available under Health Plus perhaps made LIC to revise its target to a Rs.4 billion premium from an ambitious Rs.50 billion for this fiscal.
Confident of achieving the revised target, Singh said, "Normally LIC experiences accelerated sales after the second week of March. We will book Rs.3.5 billion premium with Health Plus."
Speaking about Reliance Life's experience in selling its Reliance Wealth + Health Plan, its CEO P. Nandagopal said, "The retail response is very, encouraging, especially from the southern markets. The average premium per policy is Rs.15,000."
Reliance Life launched the policy soon after LIC came out with its health product.
Declining to give any sales numbers and the target for the year, he said, "We do not believe in having product-wise business targets as we encourage our agents to adopt a solution oriented approach."
Queried about the training given to the company's 160,000 agents, Nandagopal said, "All our sales force has been fully trained with audio visual aids to pitch properly. The retail response is very encouraging, especially from the southern markets."
Reliance Life used tools like video tutorials, multi-media messaging service (MMS) audio clips and weekly refresher programmes to drive home the salient features of the product to its field force.