Max New York Life The 3P Strategy

Case Analysis

3/14/2012

Group 5
Bitupan Borborah, Raghu Vamsi & Sangeeta

1. With the advent of private insurance players in India, how did Max New York Life decide upon its plan to gain market share in the country? The Mission, Vision and Values of MNYL were all directed towards becoming the most admired and preferred Life Insurance Company in India, they were also a people oriented company who wanted to become employees and agents first choice. To succeed with these objectives, they considered to work upon their weakness of being a new player in insurance industry with limited network and reach. With this weakness they had to face the threat of competing against LIC, huge player in insurance industry with well established network; but they had the strength of New York Life and its wide range of products and the opportunity of untapped Indian Market were customers lacked privilege of having a qualitative advice for their investment and thought that insurance policies were tax-saving investments rather than risk coverage. With this strength and the service gap and untapped market as an opportunity, MNYL decided upon its plan to gain market share in the country. They trained agents to become agent advisors, so that they could advice the customers in making a wise and informed choice of their investment. They adopted different alternative channels of distribution like franchisee model, rural business, telemarketing, banc assurance, corporate alliances and gram sahayaks. They provided much differentiation in products. All this helped MNYL to tap the Indian markets and gain the market share.

2. What was the marketing plan and strategy used by MNYL to increase its business in Life Insurance? Discuss with reference to product differentiation and process improvements made by Max New York Life?
MNYL started product differentiation by giving Whole Life policies that offered customers the correct balance between protection and savings. They appointed gram sahayaks who were the opinion leaders in villages like school teachers, social workers and chemists who could reach the rural public with specialized rural policy which provided term insurance for a very nominal and affordable sum of money. They were the first one in India to introduce a free-look period which helped customers to weigh the various available options and take well informed decisions. They were the first ones to sell a policy with riders i.e. additional benefit to the basic policy offered. They gave cash bonus for their Whole Life policyholders, in form of either as an investment with the company or as an addition to their policy or premium or as cash in hand. They tied-up with corporate like Shoppers Stop and others to tap potential customers and maximise their reach. As a part of process improvements, MNYL tied up with Newgen to get business process management tool using the web which saved lot of cost on paperwork and telephone costs and also reduced the turnaround time for customer request by 45% aiding to immediate retrieval of information.