Indian 'life insurance ladies' sell plenty of policies -- and carry a tune
Japanese insurers' old tactics hit right notes in new markets
HATSUKI SATO, Nikkei staff writer
TOKYO -- Faced with dismal prospects for growth at home, Japan's life insurers are trying out some of their traditional sales tactics to try and make inroads in emerging Asian markets.
Shortly after 9 a.m. every business day, scores of women bring Reliance Nippon Life Insurance's Mumbai sales office to life with a stirring rendition of the country's national anthem.
After investing in local life insurer Reliance Life Insurance in 2011, Nippon Life Insurance spent a long time striving to figure out an effective formula for expansion in the country.
Selling life insurance has traditionally been a side job in India. But poorly motivated salesmen moonlighting for a bit of extra cash rarely explained their products thoroughly and reliable after-sales services were almost unheard of.
As a result, about half of all newly sold policies got cancelled within a year, according to Koji Ichiba, general manager at Nippon Life's International Planning & Operations Department.
"We needed committed, full-time salespeople who can provide meticulous after-sales care," said Ichiba.
In a country where less than 30% of Indian women work, it seemed logical to try out the "seiho ladies (life insurance ladies)" system that had been so successful in Japan.
"We concluded that our best chance was to hire homemakers," he said.
Initially, there was concern over whether the company would be able to hire in sufficient numbers. But the strategy has proved successful and the teams of saleswomen initially employed at Reliance Nippon Life's seven local offices have been a huge hit.
Full-time housewives naturally tend to be less wary about saleswomen calling door-to-door, and are more likely to agree to chat than if a man calls, according to Ichiba.
The chat has not only resulted in more sales, but has also led to more women being hired.
One leading saleswoman was invited to travel to Japan to visit Nippon Life offices. Having never dreamed of leaving the village where she was born, becoming a saleswoman changed her life, she said, according to the company.
In February 2017, the company's policy of employing housewives was reported as a shining example of women's social advancement, prompting other local life insurers to copy the system.
Reliance Nippon Life now has some 2,600 saleswomen working at its 110 sales offices across the country and the company is planning to launch the system in Thailand.
Dai-ichi Life Holdings has taken a different approach.
"We were going through tough times. Morale among local employees was low and our product line was grossly insufficient," said Akihiko Tanaka, ex-deputy general director at Dai-ichi Life Vietnam, the local unit founded in 2007 by acquiring a local insurer.
While taking steps to enhance business infrastructure such as improving fragile systems, the company also used a number of Japanese-style management techniques to retain employees and boost morale. One such measure was to introduce a Vietnamese corporate song in 2012, which is sung at regular meetings and training sessions.
In addition, the company has organized annual company trips to resorts to nurture team spirit.
In 2016, Dai-ichi Life entered a business partnership with state-run Vietnam Post. Many of the postmasters in the country are local celebrities, as was once the case in Japan.
The tie-up is aimed at making Dai-ichi Life a familiar and trusted name to facilitate sales growth and it "will have a great impact," predicted Tanaka.
Taiyo Life Insurance, a unit of T&D Holdings, is looking to build on its presence in Myanmar through the efforts of Takeshi Shimada, chief representative of the company's Yangon office.
Dressed in a traditional longyi, Shimada has been traveling across the country trying to convince local people of the need for life insurance.
Taiyo Life was among the first foreign life insurers to start moving to Myanmar after the return to civilian rule in 2011. In 2012, it became the first foreign life insurance company to establish a representative office in the country.
Myanmar's life insurance market is still in its embryonic stage.
Pretty much the only kind of insurance widely available in rural areas is "snake bite insurance."
Under military rule, a state-run insurer held a monopoly on the market but its products did not offer sufficient coverage. The number of people in the country with life insurance is very low.
Taiyo Life started out by trying to build a solid foundation for sales operations in Myanmar. The company has donated computer equipment to the state-run insurer and helped its partner develop actuaries.
These efforts have helped Taiyo Insurance win the trust of the government and local businesses, laying the foundations for the partnership.
"Unlike major insurers, we cannot buy a life insurance company in a mature market," said Shimada, who has been involved in Taiyo Life's Myanmar expansion since the beginning. "True to our reputation for cold calling, I have been building business connections by making the rounds of people and organizations."
With the country set to open the market to foreign players, Taiyo Life is working with the state-run insurer to map out strategies for product development and sales promotion.
Expanding into markets like the U.S. and Australia simply requires the purchase of a local company. But this approach does not work in Asia's underdeveloped markets, where it is necessary to develop a customer base from scratch.
It seems some of the old tricks involved in the Japanese approach to life insurance sales might just prove useful in these emerging markets.