Reputation Study:
Life Insurance
Industry
Reputation Study:
Life Insurance Industry
Introduction
A deep-dive into Reputation Score of the Indian Life Insurance Industry
Life insurance is one of the most essential financial products, that offer protection and security to millions of people. It also significantly contributes to India’s economic growth and social development. India is already the ninth-largest player in the global life insurance industry. Additionally, the Indian life insurance industry also scores way above the general insurance segment in terms of the size and business that it generates. This dominance can be attributed to diverse factors, including the burgeoning awareness around life insurance, the rising middle class, and the deepening penetration of life insurance products in our hinterlands. The pandemic has only propelled this industry to the forefront, conferring upon it the distinction of being one of the sunrise sectors within the broader BFSI domain. Furthermore, life insurance players have harnessed the power of artificial intelligence (AI) and machine learning (ML), as well as digitalization, to engender product innovations and delight customers, particularly with regard to claim settlement, online sales and enhanced comprehension of customer behaviour.
On the regulatory front, the Insurance Regulatory and Development Authority of India (IRDAI), guided by its far-sighted vision of augmenting insurance penetration and nurturing sustainable industry growth, has promulgated several regulations during the period. Among these transformative measures is the liberty granted to life insurance entities to introduce novel products sans the prerequisite of prior regulatory clearance, thereby empowering customers with the prerogative of choice.
Although these disruptive innovations are revolutionizing the industry, our study reveals that a degree of discontent persists among customers. This makes it imperative for a thorough redressal by life insurance companies. Disregarding this may lead to tarnishing of the industry’s sacrosanct image.
To gauge the collective perception, expectations and challenges encountered by the life insurance industry, we delved into non-financial metrics, with reputation as an indicator. Reputation, a comprehensive and all-encompassing metric, encapsulates myriad facets of a business, ranging from seemingly inconsequential details to consequential determinations of immense significance. No specific criterion or tool presently exists to holistically gauge an organization’s reputation and furnish actionable insights. This brought us at Eminence Strategy Consulting, to conceptualize a comprehensive construct known as the ‘Eminence Reputation Score’.
The Eminence Reputation Score, a meticulously weighted average of four parameters arrived at through an extensive survey of corporate leaders, encapsulates stakeholders’ perceptions of a company. These stakeholders encompass a wide gamut of individuals, spanning customers availing themselves of the company’s services, the dedicated workforce propelling the organization’s vision, shareholders investing in the company, and regulators ensuring compliance with prevailing corporate governance practices. Moreover, the Reputation Score encapsulates the organisation’s overarching impact on the society at large.
For the period spanning January to December 2022, the industry amassed a Reputation Score of 37.2, indicative of a moderate performance with abundant opportunities to redirect focus towards augmenting the customer experience. The primary positive contributors to this score were Responsible Business Practices and Brand Exposure, both of which scored an impeccable 100, lauding the industry’s prowess in delivering innovative products and spearheading numerous initiatives with salutary societal and environmental ramifications. However, the Reputation Score faced headwinds from customer grievances pertaining to deficient customer care experiences and delays in claim settlements, landing a negative score of over 50. Additionally, the industry witnessed a low score on workplace character at 34, owing to employee grievances concerning protracted working hours and internecine office politics.
We invite you to gain valuable insights into the life insurance industry’s reputation and look forward to receiving your feedback at info@eminencestrategy.com
Eminence Reputation Score: A comprehensive model capturing multiple reputation dynamics
Life Insurance Industry Coverage
January – December, 2022
Data Sources
Social Media Conversations I Employee Reviews I Customer Reviews I Media Coverage
Scoring Scale
POOR
(<0-20)
Moderate
(21-40)
Average
(41-60)
Good
(61-80)
Excellent
(81-100)
Our analysis shows that the overall reputation score of the life insurance industry from
January to December 2022 is 37.2, representing a moderate score with significant upside potential
Each driver has a defined weightage as per the Eminence Reputation score model
The Reputation Score is based on following drivers
Reputation drivers arranged in descending order of the weightage assigned to each
No Data Found
-50.9
Customer Experience
No Data Found
100
Responsible Business Practices
No Data Found
100
Brand Exposure
No Data Found
34.3
Workplace Character
Click on each driver graph for insights
Attributes driving the Positive Reputation Score
Significant role in the launch of innovative policies and focus on ecological
footprints and health of customers and employees.
Attributes driving the Negative Reputation Score
Customer Experience
Customer grievances such as misselling & delay in crediting the insurance claim have negatively impacted the image of the Life Insurance industry
Life insurance companies are launching new customized policies based on their customers’ financial needs; however, the objective of customer delight is overshadowed by negative customer reviews on public platforms. Nearly one-third of the consumer complaints received by the Department of Consumer Affairs are from the insurance sector. Most of these complaints are for Medical & Life Insurance claims. A negative score is a reflection of customer dissatisfaction and the gap between the promise over the real/on-ground service experience.
Following the introduction of Covid 19, consumers' financial needs changed dramatically, and hence the availability of a wide range of policies, as well as adequate policy coverage, resulted in a positive customer experience.
Customer complaints about misselling policies led to negative feedback for the life insurance industry. Customer dissatisfaction was heightened further by the rude behavior of customer service representatives as detailed by customers on the public portals and complaint forums.
Discrepancies on digital platforms, such as incorrect premium amounts being debited from accounts and inadequate functionality of website and app, added to the negative perception of the industry. Unfair exercises, such as delays in crediting insurance claims or, in some instances; no refund, irked the customers.
Score
Most Prominent Topics
-50.9
(POOR)
No Data Found
Responsible Business Practices
Initiatives for Social & Environmental well-being contributed significantly to a positive image of the industry.
As per the IRDAI report, due to effective supervision by the regulator; the number of Unfair Business Practices (UFBP) complaints registered against private sector life insurers reduced from 64.58% to 54.66% in 2021-22 from the previous year. During these uncertain times, the life insurance industry has shifted its focus to being a partner in the customer’s journey rather than just a payer. Our study shows that the life insurance industry is at the forefront of running social & environmental initiatives for a safer society.
Life insurance companies have taken many initiatives for environmental sustainability like tree plantation, and beach cleaning drives, and reduced the use of plastic with the objective of “Saving Earth”.
They enhanced their focus on facilitating health care to their customers by launching free homes for children fighting cancer and their families to enable them to continue treatment. Players also continued to focus on Mega Vaccination drives for Covid-19 by providing vaccination and Covid care kits.
IRDAI’s initiatives such as the ‘Bimar Sugam’ and Bima Saral, aim to bring in standardization of processes and transparency, benefiting not only the customers but the distributors as well.
Score
Most Prominent Topics
100
(Excellent)
No Data Found
Brand Exposure
Strong product & marketing strategy, leaders’ take on the Life Insurance industry’s performance, and digitization had a positive impact on the industry’s imagery
2022 was a remarkable year for the insurance industry. The industry produced high decibels of media exposure through extensive marketing and communication strategies. The emphasis on customizing policies to meet the financial needs of customers has positively impacted the industry’s imagery.
Right product strategy includes adding value to the financial needs of customers. The insurance industry has been relentlessly launching innovative policies with evolving customer requirements. For instance, the launch of savings-oriented insurance plans, fixed maturity plans, guaranteed return plans, and DigiShield Plan. These innovative policy launches; amplified the score for this category.
Leaders of the industry gave their views on the Union Budget 2022-2023, increasing the Digitization in the industry, industry growth & IRDAI reforms; which contributed highly towards the perception of the industry. Insurance companies have partnered with various banks to strengthen policy distributions & reach.
Score
Most Prominent Topics
100
(Excellent)
No Data Found
Workplace Character
Reactions of the employees working in the industry have been balanced. While the work culture & values are appreciated by most, there is equally strong negative feedback on the senior management of life insurance companies
For an industry to be rock solid; along with customer satisfaction, it is equally important to focus on employee satisfaction. The study indicates an average workplace experience for the life insurance industry. The efforts by the industry have been commendable in terms of maintaining the work culture, and values and providing career opportunities to its employees but a lot is yet to be accomplished.
Life Insurance companies gave immense importance to the culture and values. The study indicates positive employee feedback about the excellent work environment and facilities. The learnings for the new and existing employees were given high importance to create a positive workplace experience. The employees were satisfied with the career and growth opportunities.
Negativity was fueled due to senior management’s behavior towards subordinates and workplace politics. The hectic work schedule resulted in no work-life balance and that has been highly criticized by the employees. Despite the efforts of insurance companies to provide better compensation & benefits there seems to be a disparity between the executives compared to the workforce in the field.
Score
Most Prominent Topics
34.3
(Moderate)
No Data Found
Potential Reputation Risks
Negative reviews from customers have been significant on social media platforms. Be it misselling, delay in responses or executive’s rude behavior; customer angst is high. Lack of proper functioning of the digital platforms (website, apps) added to the customers’ concerns.
The need of an hour is to shift gears from being a service provider to a solution partner. Customer expects timely resolution with a minimal waiting period. Digitization is enabling better customer service, however, ground-level concerns need to be tackled well, for a wholesome customer experience.
Reviews from employees on social media platforms show a lack of work satisfaction in the industry. Be it the behavior of senior management towards its subordinates or long working hours resulting in no work-life balance has piqued the employees’ perception of the industry.
Leadership teams need to engage more and better. The conduct of the senior management has particularly emerged as a challenge. A shift in the mindset of the Life Insurance industry from being an aggressive sales-driven industry to a more employee-focused, and workforce-friendly category needs to be established through a sustained narrative.
Recommendations
Banks are launching new products, while customers are still grappling with the existing products. Closing the service gap is essential for a smoother customer experience. Customers are putting their grievances on public platforms, that reflect a disparity in the flawless user experience committed by the banks. A focus on educating customers on better usage of digital platforms can mitigate the concerns.
The buzz around sustainable practices has increased, and the narrative is mainly steered by foreign banks. Private banks and more importantly, PSBs should increase their focus on ESG in order to remain relevant to the stakeholders, especially the environment conscious future customers.
Employees are the biggest brand ambassadors and turn into loyal customers when given a positive experience. While a lot has been done by the banks in terms of workplace best practices, negative reviews on public platforms reflect a high level of discontent amongst the personnel. This needs to be addressed as a priority for banks to continue being among the preferred sector by the current and potential workforce.
Concept & Methodology
Reputation is an overarching concept encompassing all the facets of a business from the little things that matter to major business decisions; however, there are no specific measurement criterion or tools available that presents a holistic picture of an organization’s reputation or provides a consolidated rating. With this background, Eminence developed the concept of “Reputation Score” as a composite score to measure an organization’s standing based on publicly available data and credible industry sources of information.
This one of its first-of-its-kind, holistic Reputation Measurement Score is based on globally accepted parameters. The dashboard offers a complete view of an organization’s reputation across its stakeholders. Since a multitude of factors influences corporate reputation, an exploratory study was conducted across CEOs and CXOs to understand the most impacting elements of reputation. Internal focus group discussions (FGD) were conducted with the objective to identify a comprehensive list of factors affecting corporate reputation. The identified reputation drivers, hence, are a result of well-researched ideas and feedback from this stakeholder group and secondary research sources.
The Life Insurance companies for the study were based on parameters such as market share and media visibility score. The study takes into account 50+ data variables, 10,000+ business-responsible conversations across news & social media, and 1000+ customer & employee voices. The score is arrived at based on scientifically designed weights and statistical algorithms, corroborated by research experts.
50+
Data Variables
10,000+
Business responsible conversations across news & social media
1,000+
Customer & employee voices
The score is arrived at based on scientifically designed weights and statistical algorithms, corroborated by research experts.
Team Eminence
Extensive experience in Branding, Communications, Brand Research, and Data Analytics.
Experienced professionals, having worked in business categories like Banking and Financial Services, IT, FMCG, Entertainment, Automobiles, Telecom, Manufacturing, Credit Ratings, etc.
A diverse mix from the fields of Journalism, Economics, Brand Research, Media Measurement, forms a strong force of individual and collective knowledge base for our clients.
Mitu Samar, Founder & CEO of Eminence, is a seasoned reputation consultant with two decades of experience. After having worked with well-known companies across BFSI, Credit Ratings & Logistics, she founded Eminence Strategy Consulting (https://eminencestrategy.com/), thus facilitating organizations and individuals in building, establishing, and protecting their reputation through stakeholder engagement.
She serves as an independent director on the boards of the Times Internet Limited and Aegon Life Insurance.