Max New York Life - The 3P Strategy

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In 1999, when the insurance sector was opened to private players in India, Max India Limited tied up with New York Life to form Max New York Life (MNYL) to provide individual and group life insurance solutions. In a short span of around 5 years, it established a wide distribution network with 28 offices and representatives across 21 cities in India. MNYL offered 13 products and 9 riders customized to over 400 combinations that provided a number of options to the customer.

MNYL mission, vision and values were all directed towards becoming the most admired and preferred Life insurance Company in India. They also aimed to be the first choice for employees as well as agents. In 2000, MNYL realized that to compete against LIC, the only large player in the life insurance segment, it had to build a huge network and implement a product differentiation strategy to gain customers. However, the tie up with New York life ensured that different options were given to the customer as against LIC products which were not differentiated.

There was also an opportunity in the Indian markets as penetration rates were only 1.3% and insurance policies were mainly considered as a tax-saving investment, rather than risk coverage. The leading player (LIC) concentrated only on selling and very little qualitative advice was offered to the customer buying its insurance policies. This service gap enabled a customer-oriented player like MNYL to impress the potential customers.

MNYL laid stress on training of agents, as personal relationships were the key to success in selling insurance. For this purpose, it took special measures to train agent advisors who were the primary source of distribution. In 2002, it had around 1900 agent advisors who underwent 152 hours of training before selling as against 100 hours stipulated by IRDA .

These training programs were spread over 2 years for 500 hours and ensured upgradation of skills and knowledge. The training program covered consumer psychology, the financial markets, and development of selling skills, discipline and the right attitude in the agents. These agents were groomed to become financial advisors to customers. Commenting on internal brand building, Debashis Sarkar (Sarkar), senior vice-president, marketing, MNYL said:

“We will also be focusing on internal brand-building, since brand-building has a larger context in the service sector. Internal employees are all opinion shapers and indirect brand-builders and brand promise needs to be replicated down the chain at every customer touchpoint” .