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LIFE INSURANCE

Bharti AXA plans on expanding its wings in the fast growing life insurance Bharti AXA plans on expanding its wings in the fast growing life insurance market. It has forecasted a 5 percent market share holding by the end of 2012. market. It has forecasted a 5 percent market share holding by the end of 2012. One

One of of the the priprimamary ry reareasonsons s fofor r thithis s aggaggresressivsive e expexpansansion ion strstrateategy gy of of thethe company is the huge

company is the huge potential and largely untapped insurance market.potential and largely untapped insurance market. Ind

India ia is is the the fiffifth th larlargesgest t lilife fe insinsuraurance nce mamarkerket t in in the the emeemergirging ng insinsuraurancence eco

economnomies ies gloglobalbally ly and and is is grogrowinwing g at at 32-32-3434% % annannualually. ly. ThiThis s impimpresressivsivee growth in the market has been driven by liberalization, with new player’s growth in the market has been driven by liberalization, with new player’s significantly enhancing product awareness and promoting consumer education significantly enhancing product awareness and promoting consumer education and information.

and information.

Total life insurance premium in India is projected to grow Rs 1,230,000 Crore Total life insurance premium in India is projected to grow Rs 1,230,000 Crore   by 2010-11. The current market is worth 50,000 crores. Bharti AXA Life   by 2010-11. The current market is worth 50,000 crores. Bharti AXA Life

in

insusurarancnce, e, whwhicich h is is a a jojoinint t veventnturure e cocompmpanany y bebetwtweeeen n InIndidia'a's s leleadadiningg cong

conglomerlomerate, ate, the the BharBharti ti Group and Group and FranFrance-bce-based ased finafinancial protectincial protection on andand wealth management service provider-AXA, has currently a modest share of 1 wealth management service provider-AXA, has currently a modest share of 1  percent in the market.

 percent in the market.

Bharti-Axa’s key strategy is to leverage on the

Bharti-Axa’s key strategy is to leverage on the wide reach of Bharti Operationswide reach of Bharti Operations  by aligning with Bharti Airtel distribution points, corporate agents and brokers.  by aligning with Bharti Airtel distribution points, corporate agents and brokers.

Bharti Axa has set-up virtual branches

Bharti Axa has set-up virtual branches to distribute policies using the retail to distribute policies using the retail andand telecom outlets of the Bharti Group. Bharti-Axa envisions virtual branches as telecom outlets of the Bharti Group. Bharti-Axa envisions virtual branches as aa key strategy and has currently 25 percent revenues from the same.

Chi

Chief ef actactuaruary y at at BhaBharti rti AXA AXA GLN GLN SarSarma ma saysays. s. “Ca“Capitpital al conconstrstrainaints ts havhavee  prevented us from being overly aggressive. We would like to retain what we  prevented us from being overly aggressive. We would like to retain what we have and consolidate our position.” The company is also not planning any big have and consolidate our position.” The company is also not planning any big advertising campaigns and instead, has chosen to communicate with customers advertising campaigns and instead, has chosen to communicate with customers through phone calls, text messages and emails. Sarma agrees that product through phone calls, text messages and emails. Sarma agrees that product distribution and building channels has been a problem for Bharti AXA because distribution and building channels has been a problem for Bharti AXA because the company does not have a parent bank to fall back on. “Also, many banks the company does not have a parent bank to fall back on. “Also, many banks ha

have ve tuturnrned ed ininto to ininsusurarancnce e prprododucuct t mamanunufafactctururerers s frfrom om memere re ininsusurarancncee distributors. This makes them our competitors ruling out the possibility of a distributors. This makes them our competitors ruling out the possibility of a distribution deal with them,” he says.

distribution deal with them,” he says.

However, despite the capital constraints, Bharti-Axa is all set to infuse another  However, despite the capital constraints, Bharti-Axa is all set to infuse another  10

100 0 CrCrorore e in in ththe e fofoururth th ququararteter. r. ApAparart t frfrom om ththisis, , ththe e cocompmpanany y is is on on anan aggressive hiring spree with its plans to beef up the sales force to 45,000 from aggressive hiring spree with its plans to beef up the sales force to 45,000 from the present 30,000.

the present 30,000.

The current product portfolio of Bharti-Axa is that of eight life insurance The current product portfolio of Bharti-Axa is that of eight life insurance  products. This includes six ULIP products. The company’s CFO, V

 products. This includes six ULIP products. The company’s CFO, V Srinivasan,Srinivasan, commented that Bharti-Axa’s key strategy would be to focus strongly on ULIP commented that Bharti-Axa’s key strategy would be to focus strongly on ULIP  products.

 products.

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