Reliance Life open to talks on bancassurance tie-up

Reliance Life Insurance aims to be in the top three league of private life insurers by premium income in the next three years.

To meet this aspiration, the company has now realised that it needs to get on board a bank of a critical size as a bancassurance partner.

As on date, Reliance Life is in the sixth position in premium income among the private players. Bancassurance has been a distribution gap for Reliance Life.

To bridge this gap, Reliance Life is now open to discussions on giving a very small equity (say up to 5 per cent) to a good candidate (bank) as distributor stock option.

But the company has ruled out giving any upfront money for bancassurance tie-ups as sought by some banks, if such deals are legal.

“Upfront money is not legal and not permitted in any law. We know it is not legal and so there is no point offering it also,” Malay Ghosh, President and Executive Director, Reliance Life, said in an interview to Business Line here.

“If a company in five years can create value for us, we are ready to give small equity to them at today’s valuation with guarantee to buy them back at future valuation. This is possible. But giving upfront dowry our promoters do not like.”

According to him, to address the bancassurance gap, the company is working on two-pronged strategy.

First, it will undertake more intensive discussions with the insurance regulator and engage with it to see that the bancassurance guidelines — which talks of opening up bancassurance in whatever form — happen fast.

The company is also talking to every bank in India and impressing on it that if an opportunity comes for it and if it looks for another partner (if not happy with the current one), it might think of Reliance Life as a partner.

Reliance Life Plus Club

Reliance Life Insurance, a part of Reliance Capital, has launched a first-of-its-kind customer service initiative — ‘Reliance Life Plus Club’.

Inspired by ‘Zutto Motto’ (forever more service) service at Nippon Life, Reliance Life has under the new initiative made it mandatory for all the sales agents and channel partners to visit its policy holders at least once in a year.

During the interaction, these representatives would review the customers’ existing policies, understand the changes and developments in their lives since the last policy was issued, evaluate current insurance needs and offer advice on suitable new products.

Such a structured post-sales customer service platform will help reduce mis-selling, according to Malay Ghosh.

The Indian life insurance industry is facing issues on orphan policies and also complaints on mis-selling.

The company targets to meet 1 million customers (out of 9.5 million customers) by the end of the current financial year.

srivats.kr@thehindu.co.in