IRDA, GIC come together to create insurance awareness

In a bid to increase awareness about non-life insurance products, the Insurance Regulatory and Development Authority (IRDA) along with the General Insurance Council (GICL) would be launching a consumer awareness advertising campaign. The pan-India advertisement campaign would be rolled out on television, radio and print in 11 different languages in a month’s time.

The GICL is an association of 27 non-life insurance companies in the country.

R Chandrasekaran, secretary general, GICL, told Financial Chronicle, “The awareness campaign would focus on indemnity. It will tell people that in case of a damage/loss, an insurance policy can help you get back to the position before the loss.”

“We are going to approach the Directorate of Audio Visual Publicity for approvals. This is the first time we are launching a co-ordinated pan India campaign to create insurance awareness. In a couple of weeks, we will be ready with the advertisements on TV, radio and print. There will be no advertisements on web and outdoor. The advertisements will be in 11 languages (English, Hindi, Marathi, Gujrati, Assamese, Oriya, Bengali, Tamil, Telugu, Kannada, Malayalam),” added Chandrasekaran.

An industry official close to the development said, “The cost is around Rs 20 crore and is largely funded by IRDA.”

The idea to launch a pan India insurance awareness campaign was first proposed in 2010 by the CII sub-group on health to IRDA. The insurance regulator then sponsored a national survey consisting of 30,200 households in 29 states and union territories to gauge awareness, penetration and experience of insurance products in 2011.

The study found that awareness for non-life (health) insurance is low with only 54 per cent households having heard about it. A high proportion of households connected insurance with loss of life and were unaware about other types of insurance covers in the non-life insurance space. Television was the primary source of information for insurance for most households, followed by radio among rural households and newspapers as the second source of information for urban households.

The study recommended that in terms of an immediate action plan, a consumer awareness advertising campaign needed to be rolled out at the earliest that would ensure that the masses are made aware of the need and benefits of insurance.

“The communication task for the campaign should be to create awareness and to provide ‘reason to buy’ general insurance personal line products across motor, health, property and rural segments. The creative thought for spreading awareness has been suggested as “kal aaj aur kal” – the rewind button for an individual’s life styles as insurance which indemnifies one against adverse events. The ‘reason to buy’ insurance for an individual has been emphasised by positioning as the solution an individual needs to adopt to have the capability to bounce back should an unforeseen event strike causing a financial loss,” said IRDA study on insurance awareness.

Though the non-life insurance premium underwritten grew by 23 per cent in FY12, reaching Rs 53,000 crore from Rs 43,000 crore in FY11, the growth of the industry has not led to an increase in insurance penetration (being defined as ratio of general insurance premium to national GDP). When the insurance industry opened up in 2001, the penetration level of insurance was at 2.71 per cent. After 10 years of opening up, the penetration levels of the insurance sector stands at 5.10 per cent. Out of this, the life insurance sector has penetrated at a higher level than the non-life sector. The general insurance sector penetration level was 0.55 per cent in 2000, which has risen to 0.7 per cent in 2011.

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