‘Greater synergy needed among insurance distribution channels’

Insurance industry must improve efficiency in distribution by finding greater synergy among the different channels, a CII-EY report has suggested.

This will help in well-rounded growth of the industry and maximum value creation for all the stakeholders, the report said.

The report also wants insurers to be careful in identifying the right ways to employ additional capital inflows that they may receive over the next few years from foreign partners.

Sanjiv Bajaj, Chairman, CII National Committee on Insurance and Pensions, said the onus was clearly on the industry to realise its full potential in the coming years. “The market has expanded and given each one of us more than enough room to prosper. Solvency is far in excess of minimum regulatory requirements. We made some mistakes and the slowdown of the economy hit us hard but the regulator stepped in and the life insurance sector responded by realigning well”, he said.

Rohan Sachdev, Global Insurance Emerging Markets Leader and Partner, EY India, said the industry must focus on aspects that will build value for all stakeholders — customers, distributors, shareholders and insurers.

“A step-by-step approach must be adopted to build value for customers, the primary stakeholders. Technology and analytics help to understand exactly what customers want, thereby creating long-term value for customers and earning their loyalty.” The report highlighted that skill development at an industry level and better service integration between the insurer and the distributors will help in improving efficiency.

Also, the potential capital infusion must be effectively utilised to drive awareness and reach out to the under-penetrated segments.

Insurers must embrace digitisation and have a resilient cyber security framework to disrupt the traditional business structures, the report said.

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