In Fact, Life Risk Changes Over Time. New Insurance Demand Is Also Created In The Market.
Insurance is For Risk Management. And The Risk of Life Remains The Same. Two Years Ago Today, We Could Think About The Epidemic? About The Need For Insurance to cover the huge Cost Of His Treatment? However, as Soon As This Risk Came In Our Life, the Covid Vaccine Came To The Market As Well.
In Fact, Life Risk Changes Over Time. New Insurance Demand Is Also Created in The Market. And In Keeping With That, Insurance Companies Also Come In The Market With New Projects. Keeping These Projects Relevant And Keeping Your Business Profitable Is Not An Easy Task. It Involves Complex Math Calculations and of Course Getting Approval From the Insurance Regulator Before It Goes On The Market.
This is The Initial Step To Create The project. Before planning an insurance Scheme Companies Carry Out A Detailed Market Survey To Understand The Buyer’s Needs And Gaps. Various levels of survey are conducted. answers to the following Questions Are Collected:
Keep in Mind That Insurance Is A Product. And Like All Other Products, its Ultimate Goal Is To Satisfy The Needs of The Customers. It Is True That if a Project Can Touch The Customer’s Pain Points, It Becomes Easier To Sell. With The Help Of The Information Obtained From The Survey, A Project Is Developed in Such A Way That It Can Meet The Needs Of The People.
This is The Next Step In Creating An Insurance Plan. Insurance Companies Identify Various Risks Associated With Projects. Again, a Project May Be Profitable For Some People But Not Profitable For The Company. The Sustainability Of The Project Also Needs to Be Reviewed. Canceling a Plan Hurts Customer Sentiments or Damages The Insurance Company’s Brand Image. So It Is Very Important to Understand It. Moreover, Creating New Projects Takes A Lot Of Time, Labor and Money. As A Result, If The Project is Not Sustainable, It Will Ultimately Affect The Revenue.
Fix The Price
Once The Risks Of The Product Are Understood, it is Time To Set The Price. This is One Of The Challenges That Insurance Companies Face. In Other Businesses, Product Pricing Is Based on the Cost Of Ingredients And profit Margins. But When The Insurance Company First Sells A Plan, The Actual Cost Is Not Known.
The Actual Price Is Known When All The Claims Of The Policy Holders Are Settled. Hence Insurance Companies Estimate Future Risk Trends Based on Historical Data And Charge premiums and plan Prices. Companies Today Use Advanced Analytical Techniques to Calculate What Might Happen, Predict Future Customer Usage, And Determine Pricing Strategies.
Applying For Approval Of Irdai
Before Devising A Strategy And Launching An Insurance Product In The Market, One Has To Apply For The Approval of The Insurance Regulatory and Development Authority of India.
Keep in Mind That This Application Has To Be Done in a Specific Format, In Which Everything Related To The Product Needs To Be Explained.
From General Description To Project Specifications, For Whom, Delivery Route—Everything Needs To Be Detailed in This Application. The Regulator Approves A Project Only If All The Criteria Are Met. After the approval of IRDAI the Marketing Department of Insurance Companies To Sell The Scheme In Market Name.
Creating an Insurance Plan Is A Complex Process. There are many Internal And External Factors That Insurance Companies Have To Consider Before Developing New Schemes And Bringing Them To Market. Outliers Include Digital Delivery, When And Where Insurance Services Are Available, Etc. Again Internal Issues Include Increasing Profits And Diversifying Supply Channels Etc.
Also Read – A Step-by-step Guide To Building An Insurance Portfolio