India’s insurance sector is poised for a tremendous 500 percent growth and forecast to become a 60 billion dollar industry by 2010. In order to tap the rural market, insurance companies have to understand the peculiar needs and occupational structures of India's villagers. Insurance needs to be packaged in such a way that it appears as an acceptable and affordable investment to the rural people. There is a changing mindset in rural India with more people wanting to take charge and manage their risk effectively. Rural India’s income has risen due to shifting of its occupation from agricultural to non-farm income and this has become an important facet.
The growth of the insurance industry in rural India has been impeded by the sheer failure of insurers to reach rural areas and understand their specific needs. In turn, many of the rural poor are suspicious of insurance firms and lack understanding of their role.
Comat considers it important to focus on building an equitable market for insurance across the nation. India’s 950 million uninsured represent a ‘missing market’ of $2 billion for insurance companies. We partner these companies to allow insurance benefits to permeate to rural areas through our well-networked Rural Business Centers (RBCs).
The Comat RBC helps counter challenges faced by most insurance companies such as the high cost of setting up branches in rural areas, educating the populace on the importance of insurance as a protection and savings instrument, high level of policy termination and other operational challenges such as documentation and collection of premium. Comat brings a unique advantage in that we can draw upon our in-depth knowledge of the rural populace and work with our partners to offer ‘customized’ products that are ‘tailored’ to suit the rural consumer and ensure that he/she understands the benefits of the same.
We are confident that with our extensive network of RBCs, we will be able to offer protection to the rural segment that will benefit significantly from it. Products include Life, Motor and Personal Accident insurance. We would also look at expanding our product-portfolio to include health and rainfall insurance, amongst others.
Comat has partnered with the Life Insurance Corporation of India (the nations largest life insurance service provider) and ICICI Lombard (ranked India’s No.1 private general insurance company) to provide effective insurance solutions to the rural populace in all its RBCs. We understand and cater to their need for simple procedures, prompt settlement and ‘doorstep’ insurance service delivery.
We also work closely with the rural citizen and help them understand the benefits of being a part of the formal financial net through the presence of a large sales force in rural areas.
Comat has commenced delivery of insurance solutions in 1000 RBCs and will look at expanding the same to as many as 7000 centers over the coming months. Our current work has extended to 5,000 villages where we have seen an increase in ‘savings’ among rural citizens. Life Insurance is treated as a ‘tax friendly’ savings account and there are over 10,000 first time policyholders who have now entered the ‘formal financial sector’ through this scheme.