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‘Huge Scopes Exist for Bangladeshi Customers to Engage in Insurance Sector’

Adeeba Rahman/Photo: Arif Mahmud Riad
Adeeba Rahman/Photo: Arif Mahmud Riad

Adeeba Rahman being a Chartered Insurer and an Associate Member of Chartered Insurance Institute, UK accompanied by long outstanding experience of 19 years out of which more than 15 Years in almost all the areas of life insurance business, is experienced in working with two international banks, two life insurance companies at different levels, as well as gathered experiences from a renowned securities company and a tea company. Adeeba currently is holding the position of CEO of Delta Life Insurance Company Limited.

Adeeba in her recent interview with Fintech  reflects on the prospects of life insurance business in Bangladesh, opportunities for youngsters and inform how to create a trusted brand in financial sector. Here is the excerpt for Fintech readers.

Recently, you have been conferred with the “CEO of the Year” Award by CMO Asia and “Women in Insurance Leadership Award” by Indian Chamber of Commerce. How do you feel leading the Women empowerment agenda and what’s your message for the young leaders?

Bangladesh is having a huge demographic dividend in terms of young population, and we look forward to this young generation taking up the leadership position soon. The youth who are already in the leadership roles and those aspiring to be one should remain focused and committed on the purpose, vigilant on Corporate Governance and live their dreams without fear. Challenges and obstacles are motivation to be long-term strong leaders.

For more than three decades, it has been a sincere and organized effort of Delta Life to empower the women in the rural Bangladesh through opportunities of income generation and also providing solutions for family’s financial security and I take a lot of pride in leading this Company from the front. For me it is a duty to continue with the legacy and responsibility to create newer avenues of enabling prosperity through the women force. Continuously for three years, we have been celebrating the women power through “Naari Sammelan” where about 300 of our key women associates participate and share their success stories. We plan to enable the women at all levels to participate in the growth opportunity through continuous education and learning. We aim to provide simplified technology oriented tools which will help them to work efficiently and use the time effectively

A hardcore insurance professional, you opted for Insurance Career as a youngster and have risen through the ranks. As a successful Leader, what message would you like to give to the youth of the nation and how can they participate in the sunrise industry like Insurance?

 I had joined Insurance Industry in the year 2002 when I was in my twenties, and it has been an exciting and eventful journey comprising of highs and lows, where I learnt that Life Insurance is a long-term business and patience and perseverance will help you to sail through all the obstacles. Life Insurance, to me, is much more than a profession or a business. For me it’s a calling where one has the responsibility to provide financial security to the families of a nation which is in its nascent stages of growth and eagerly preparing towards being a prosperous state. My endeavor has been to help the youngsters understand the nature of business and the unique essence of serving the society, besides being an attractive career option. Insurance shall be one of the upcoming industries in the near future, and youngsters should plan early as this sector provides opportunity across various functions of sales, distribution, customer service, actuarial, product experts and many more

Delta Life has been awarded with the “Micro Insurance Leader” by CMO Asia. As a pioneer of this concept in the life insurance industry, please share about the success story of “Micro Insurance” and how has it transformed over the years

Recognition of the pioneering efforts for three decades is a matter of pride and joy for every member in the Delta Life family. In 1988 Delta Life Insurance launched the concept of micro-insurance in the country with the primary objective of reaching every household through a network of trained and dedicated agency force, and help them understand the need for family protection and small savings. Starting from Tk 10 every week from a household in those days, today with the immense progress of the nation and individual income, our Agents still visit every household once a month to collect the premium as low as Tk 100 and help them create a corpus for 10 or 15 years. “Gono Grameen Bima” as our micro-insurance is popularly referred to as contributes approx 40% of our total Gross Premium, whereas for the Industry it is approx 16%. Delta Life currently has a market share of 18% in the micro-insurance segment. We are continuously taking initiatives to introduce technology for ease of processing and also new and innovative methods of premium collection including mobile banking channels.

How do you see digital changing the business landscape in the coming years and how will the consumers benefit from the same?

Digital has caused disruption in various industries and financial services world-over has transformed dramatically in the way business is conducted. Loan Approvals in minutes and Insurance Policy being sent on email in less than half an hour are some of the revolution being witnessed in the sub-continent also. Each of this disruption is aimed to benefit the Customers in terms of pricing, procurement and servicing. Life Insurance Industry can be immensely benefitted with digital application in terms of risk-assessment, reduction of moral hazard, prompt settlement of claims and enable all stake-holders to be in control of the business at all times. Delta Life has already stepped into the digital space through a user friendly App – Delta Life Smart Advisor and we are in the process of launching of newer tools which will help our field force to render services in a better and efficient manner, and also empower the Customers to know about their policy details and service requests at the click of a button.

How does the product of your company fulfill the customers’ needs and are they simple?

The general perception amongst the people is that life insurance product is complex and not easy to comprehend, however at Delta Life we have always believed in “Simplicity” as our guiding principle coupled with transparency which helps to create trust amongst our valuable clients. More importantly, it is also pertinent to note that sellers (in this case Agent) need to be properly trained and well-versed with the product features and benefits and they should be able to address the queries at the time of solicitation. We have a suite of products which cater to different needs of the family like Savings, Income Protection, Wealth Creation, Children’s Education and Retirement Planning. However each of these products are explained in simple language to the Customer in terms of “Give and Get” equation – what does the Customer pay as Premium and what benefits does the Customer receive under various scenarios during the tenure of the policy. Every year we publish the Policy Bonus, post the actuarial valuation and inform it to our Customers so that they are aware about the accumulation in their policy. Life Insurance is a long-term contract and hence it’s very critical to keep things simple and easy for common man to understand and not be misled by false promises and commitment.

As a market leader in providing Group Insurance schemes to large number of corporate in Bangladesh, can share your experience and potential areas of employee benefits that can be further explored?

We have been serving about 500 Corporate Clients including the large state-owned organizations, private sector and MNCs. Primarily; two products which are popular in the Employee Benefit segment are Group Term Life Insurance and Group Health Insurance for self, spouse and family. Over last five years, we have witnessed an increased awareness and interest amongst the Corporates to provide benefits for the employees in terms of enhanced coverage and including the family members in the health cover. Our experience has been fairly encouraging and we are developing newer segments and product options to facilitate the employers to provide for more flexibility to the employees, which is a key distinguishing feature in other markets. Employee benefit program can be extended beyond the normal to offer enhanced covers and benefits as voluntary options in future. With the growing economy and more people joining the formal employment, this segment would require lot of attention as it represents a huge opportunity in the market place. Currently, we have more than 10% market share in this segment which we intend to grow continuously with newer value propositions to the employers for creating a happy workplace.

Bangladesh Life insurance market has immense potential and untapped opportunity. What according to you are the game-changers for increasing the penetration at a faster pace?

With a fast-paced economic growth, Bangladesh represents enormous opportunity for financial products like Life Insurance. Increasing per capita income, higher life-expectancy and large number of young working population makes it an interesting and attractive market for life insurance products. Building consumer trust and confidence through a concentrated education and awareness programs by the industry, regulators and government shall be the first step towards higher penetration. The industry needs to attract young talents from the market who can build a Career in Insurance because the country’s youth today are equipped with modern technology and have an orientation to experiment new things to bring fast-paced results. With the current penetration level at less than 1% of GDP, and economic growth poised to be in the 8% annual category, there needs to be serious thinking on enabling newer distribution channels, incentivizing agents for a long-term career, product innovation and revisiting the existing set of regulations to suit the current trend in the financial markets across South East Asia. Financially strong insurers with long-term visibility need to take the lead and with the help of the regulatory body these insurers can make a difference to the overall landscape of the life insurance market. Almost 90% of the business contribution in terms of gross premium is from top ten players, leaving the balance 22 players to contribute only 10%. A coordinated effort with objectivity can help increase the penetration level by 1.5-2% in next couple of years

 Education and healthcare are two important pillars of growth for Bangladesh economy. How do you view the role of Health Insurance in a building a robust healthcare system?

While the macroeconomic drivers suggest more health care spending and the demographic data suggests increasing demand for health insurance, out-of-pocket financing is currently the primary means of financing health care costs. The need for quality health care necessitates emerging of a strong and robust private health insurance market which shall provide the people with options of reducing the out-of-pocket financing and be more assured. Neighboring countries like India are witnessing growth in Health Insurance market at a CAGR in excess of 20% for last couple of years. Enormous opportunities exist across Bangladesh to engage and educate customers, “manage for wellness,” and increase preventive care to boost the effectiveness and efficiency of the health care system. We definitely see the Health Insurance market to become a $1 Billion market over next couple of years supporting millions of households. The success is dependent on many factors including technological innovations and well-developed segment of Third Party Administrators.

Innovation is the buzz word in financial services. Please highlight some of the innovations in products and customer servicing which can transform the business radically.

Financial Services Industry is marked by continuous innovation across sectors and various operational areas.  Life Insurance Industry is still to witness the magnitude of innovation which has provided for transformation of the Industry in various markets across South East Asia. This industry needs innovation primarily across effective Distribution, flexible Products, efficient Customer Servicing and prompt Claims Payment. In the fast changing landscape, traditional mode of agency-led distribution needs to be supported by new and innovative mode of distribution through Banks, Institutions, and Online etc, which will lead to deeper penetration and significantly lower the cost of operation. A matured equity market will enable unique product line in form of Unit Linked Insurance Plans and similarly the need to develop both Protection and Pension plans which can be customized to individual’s needs. We need to remember that CUSTOMER is the most important person in this business and all our efforts in innovation should lead to better solutions, enhanced benefits and world-class service standards for the Customer.

Delta Life is amongst the leading life insurers. How do you plan to continue the leadership position over next couple of years, considering changing technology, new competitors and product-line and primarily how do you stay ahead of the curve?

Delta Life has been keeping track of the development in the Insurance market across the sub-continent and other similar markets which helps us to identify the trend in advance and prepare the organization for future. We have been investing in technology for almost a decade and have gradually ramped up other areas which require orientation towards efficient and prompt Customer Service. The key focus areas which will help us deliver as per the desired expectations are innovation in technology for cost and service efficiency, digital tools for operational ease and comfort to the Customers, customized solutions to cater to different needs and changing economic parameters, and a trained and professional work-force equipped to engage with the modern customer.

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