International Journal of Application or Innovation in Engineering & Management (IJAIEM)
Web Site: www.ijaiem.org Email: editor@ijaiem.org, editorijaiem@gmail.com
Volume 1, Issue 2, October 2012
ISSN 2319 - 4847
CRM IN INSURANCE
Nitin Singh Sikarwar
Associate Professor Marketing HCTM, Technical Campus, Ambala road, Kaithal (Haryana), India
ABSTRACRT
After telecom and banking, it is the turn of insurance companies to deploy customer relationship management (CRM)
solutions. As competition is increasing, companies are trying to retain existing customers, with a wide range of services driving
the market of services for CRM applications. Insurance companies spend nearly 12 percent of their IT budgets on CRM
software and services. Our focus of the study would be on how CRM helps in the growth of business like providing better
customer service, increasing customer revenues, identifying customers, enabling sales staff close deals faster, make call centers
more efficient, up-dating customers about recent developments, etc. In case of an insurance employee, all his colleagues are
his internal customers. Unless there is a perfect harmony among the different individuals involved, the customer is put to a
great deal of inconvenience. In addition to the pressure created by an unhappy internal customer is well experienced by
insurers. External customers are all those with whom an insurer has to interact in the course of managing daily business. In
addition to the regular customers who have a policy wit the insurer, there are a number of potential customers whose issues
need to be addressed.
Keywords: CRM-Customer Relationship Management, internal customers, External customers, CRM software.
1. INTRODUCTION
Customers Relationship Management (CRM)is a broad term that covers concepts used by companies to manage their
relationship with customers, including the capture, storage and analysis of customer information. The CRM must
consider customer privacy and data security. Customers want the assurance that their data is not shared with third
parties. However Customers also want their data by companies to provide a benefit for them. For instance, an increase
in unsolicited telemarketing calls is generally resented by customers while a small number of relevant offers is
generally appreciated by customers.
Business process outsourcing (BPO) plays very important role in lead generation and customer care. They gather the
data from companies data warehouse using data mining tools for use by insurance companies. This is based on age
group, income source, service type, gender etc. The customers are tapped telephonically on their feedback, to inform
insurance company to follow-up the customer. BPO helps to improve the customer experience by resolving complaints
rapidly. They identify issues faced by customers and help to detect and capture other useful pieces of information
around a customer’s life stage, financial needs and product interests, which can generate leads and trigger cross-selling.
There are three aspects of CRM- operational , collaborative and Analytical. In operational aspect of CRM there is a
support to “front office” as well as “Back Office” business processes, including sales, marketing and services. Each
contact or interaction with a customer is generally added to a customer’s contact history, and staff can retrieve
information about customers from the database as necessary. One of the advantage of this contact history is that
customers can interact with different people or different contact “channels” in a company over time without having to
repeat the history of their interaction each time.
In collaborative CRM there is direct interaction with customers. The interaction can be through variety of channels,
such as internet, e-mail, automated phone (Automated Voice Response (AVR)) etc. The objective of collaborative CRM
is cost reduction and service improvements. Third aspect of CRM is analytical CRM which analyses customer data for
variety of purposes including design and execution oft targeted marketing campaigns.Optimization activity.The
analyzed customer information can also be used for customer acquisition, cross-selling, up-selling, retention,etc.
Analysis of customer behavior to aid product and service decision-making, management decision-making, prediction of
the probability of customer defection. CRM attract customers by providing chatting facilities (chat rooms) of chat rooms
which increases customer’s loyalty to a service provider.The most important tool of customers service is e-mail. It is
used to spread information, to send product information and to correspond with customers regarding their inquiries.
2. ADVANTAGES OF CRM
There are some insurance companies which have linked their website to its call center. Thus enabling the call center
executives to know the customer’s sales history and his buying behavior. It helps the companies to know the consumer
behavior and buying patterns for different range of products or policies. When a customer log onto company’s website
to buy a policy or to complain when he faces a certain problem, an agent in the call center can simultaneously talk to
Volume 1, Issue 2, October 2012
Page 222
International Journal of Application or Innovation in Engineering & Management (IJAIEM)
Web Site: www.ijaiem.org Email: editor@ijaiem.org, editorijaiem@gmail.com
Volume 1, Issue 2, October 2012
ISSN 2319 - 4847
him, see his history and give advice accordingly. The interaction will further lead to know more about customer’s
purchasing habits, which would affect future sales of the company. Integration of information into organization as
whole for everybody use can simultaneously operate with enterprise resource planning (ERP) and databases to help
refer to customer bill status, his account and other relevant details. In this way CRM helps the organization in
increasing sales by adding new customers, by understanding their needs, behavior and enhancing their positive
experience.
Application of CRM in insurance industry offers several benefits. Firstly it is a continuous product development. Which
reduces the cycle time for introduction of new products. Secondly there is efficient distribution.,Which enables faster
communication with agents and brokers and reduces the cost to distribute and update information. Thirdly servicing by
use of contact center management systems enabling better servicing thus reducing costs. Fouthly claims by introduction
of CRM systems helps in web based loss filing and checking the claims status. Fifthly optimizes the selling strategy
thus helping in accurate forecasting of customer behavior and better territory management. Lastly helps in developing a
definitive ROI strategy through the use of various metrics such as customer satisfaction ratings, depictinf the number of
customer complaints and knowing about the customer attrition levels.
3. MANAGEMENT GAME PLAN FOR CRM
Some of the time-tested and popular strategies adopted by private insurers towards relationship building and
management efforts range from sending out a greetings message on special occasions, data mining and cross-selling to
sponsoring mega events. Experience has shown that each interaction at an event may not result in a sale; nevertheless
the aim is to make each interaction a potentially profitable opportunity to offer additional value to the customer. Again,
insurers embarking on event-driven marketing strategies are in a better position to feel the pulse of the customers and
channel their energies towards meeting customer expectations. The other advantage is that this strategy results in a
greater return on marketing investment coupled with reduced marketing costs, lesser cost of communication reaching
out to a larger targeted audience and a higher response rate.
Campaign management in retail insurance is also growing by leaps and bounds from single channel mass campaign to
multi-channel targeted campaigns. Technologies have evolved to such an extent that the management can keep a tab on
the real-time status of a campaign, complete with client history to enable competition has turned the insurance industry
into a buyer’s paradise. “The pension market has been developing in a big way that would benefit the large section of
the people in the organized and unorganized sector. The annuity market has started growing. Customers are offered
unbundled products with a variety of benefits as riders from which they can choose. This choice has empowered the
customers and this is a positive signal.
However in their anxiety to reach out to more customers and grab a bigger piece of the cake, insurance company
branches appear to be mushrooming all over the cities. More branches entail deployment of more staff. Recruitment
and deployment of personnel without adequate inputs relating to the industry, the products and related issues can have
a detrimental effect on CRM. A ‘top-down’ CRM focused approach that starts with the top management, percolates and
permeates all levels of the organization, is the need of the hour. Success of such a strategy will be possible only when
an exclusive CRM team ensures dissemination of the CRM philosophy, conducts a regular CRM audit and offers
suggestions and ideas while filing the ‘CRM performance report’ with the top management.
LIC’S Commitments and Standards:
To Our Customers
We will:
 Provide them prompt, efficient and courteous service;
 Act as trustees of their funds and invest the funds to their best advantage;
 Conduct our business with utmost economy and on sound business principles;
 Build and maintain enduring relationship;
 Keep the customer informed.
4. CONCLUSION
Standards for Easy Access to information for customers
We will:
 Educate the customers and the public of the various options available in the area of products and services.
This will be done through on-going consumer education campaigns with a special focus during the
“Consumer Education Week” to be organized in September every year.
 Make available to the customers brouchers in regional languages and in easy-to-understand style on our
products and services.
Volume 1, Issue 2, October 2012
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International Journal of Application or Innovation in Engineering & Management (IJAIEM)
Web Site: www.ijaiem.org Email: editor@ijaiem.org, editorijaiem@gmail.com
Volume 1, Issue 2, October 2012
ISSN 2319 - 4847


Expand our existing Home page on the Internet to include more details of our products and services, on an
on-going basis;
Enhance the content and frequency of our communications with our customers. This will be attempted
through press Releases, press Conferences, TV/Radio Interviews etc. The communications would, besides
providing information on progress of the organization, highlight forums of grievance redressal available
to the customers, inside the organization.
Standards for Fairness in Dealing with customers
We Will:
 Strive to deal with our customers in an open and transparent manner;
 Explain the rationale behind our decisions, consistent with requirements relating to business
principles, wherever such decisions are likely to affect the customers’ interests adversely;
 Continuously expand our product-line and services to afford wider choice.
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International Journal of Application or Innovation in Engineering & Management (IJAIEM)
Web Site: www.ijaiem.org Email: editor@ijaiem.org, editorijaiem@gmail.com
Volume 1, Issue 2, October 2012
ISSN 2319 - 4847
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