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Interview of Ashutosh Bishnoi, Vice President, Marketing,
OM Kotak Mahindra Life Insurance
Unit linked insurance plans are popular today.
Why?
I think its because they are more returns-oriented. For
the first time, a person buying insurance is able to understand
where his money is going and he is able to also choose the
asset stream where he can park his funds. He is more comfortable
today. Such a choice was not available earlier.
How many unit linked products have you launched?
We have one plan at present – Kotak Safe Investment Plan.
How much has the plan contributed to your business?
Majorly. We had launched our unit linked plan in July and
in terms of sales unit-linked plans have contributed about
25 percent to overall premium.
Is the Indian customer matured enough to understand
the nuances of the product?
Personally I do not think a person needs to understand the
workings of the stockmarket. All he needs to understand
is how much he gains or loses.
Who is your target audience in case of unit linked
plans?
Be it unit linked plans or any other our focus is not selling
at the lower end. Our strategy has always been to target
the upper middle class. We are not focussing on the masses.
What are the points that a customer should take
into account while purchasing unit-linked products?
Before buying unit linked plans a customer should analyse
his risk appetite. If an individual cannot stomach a short-term
loss he should not go in for unit-linked products.
Since these products are directly related to the
ups and downs associated with the stock market, when the
market sees a downward phase, will the customer not lose?
In case of our product we have built a safety feature into
the plan that takes care of such risks.
While transparency is one thing, regularly monitoring
the fund is an important aspect. How far will the common
man be able to do so considering that insurance products
hitherto did not have such features?
The policyholder will need to monitor his investment atleast
every quarter.
How much of the premium component goes into administration,
fund management & other charges and how much of it actually
constitutes the risk cover?
In our case: approximately 20% goes into expenses
on agents, administration, registration, stamp duty etc.
Our fund management charges are around: 1.5% to 0.3%
Your distribution network?
We have spread ourselves across 31 cities with
42 branches and 6000 life advisors.
What are your future plans?
On the individual front our product shelf is as of now
reasonably full. By the end of this year we plan to come
out with children's plans and unit linked annuity plans.
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