'Bundling' game to expand base

The next time you open a savings bank account with a new-generation bank, you just might get a free life insurance cover. Buy units of a mutual fund, and you could get an insurance cover equivalent to its value, absolutely free.
And a Diner''s Club cardholder gets life cover up to Rs 30 lakh! It''s just the beginning of one of the newest concepts in the domestic insurance business—bundling.
Quite a few marketing heads of life insurance companies readily admitted that bundling opportunities are too lucrative to overlook.
For Saugata Gupta, marketing chief of Prudential ICICI Life, doing business in life insurance is a lot about identifying niche opportunities all the time. And he is confident that bundling is one of the most promising strategies in the Indian market.
''''Gone are the days when insurance was seen as just an investment-linked product or a tax-saving product. Now we are working on value-added products that can entice the masses, be it as add-ons to housing loans, credit cards, auto loans, or deposit-linked products.''''
In fact, several life insurance companies are busy tying up with financial services firms to offer life insurance cover to end-customers. SBI Life has taken a lead over the others through tie-ups with GE Countrywide and Maruti Countrywide for offering life cover with personal loans and auto loans, and with sister company SBI Home for innovative life insurance products.
The other players are also aggressively looking for piggy-backing opportunities. Prudential ICICI is planning to tap the mortgage insurance market in a big way through strategic tie-ups with housing finance companies, and with banks for deposit-linked products.
Om Kotak Mahindra Life Insurance has designed a product whereby MF investors in particular schemes get free insurance cover. The company is also in tie-up talks with travel companies.
Ashutosh Bishnoi, marketing head of Om Kotak, believes that bundling opportunities in the Indian market are immense. ''''When we look at creating new products, bundling is increasingly a thrust area, especially in terms of wealth creation over the long term. Bundling also helps in augmenting the awareness campaign required for an insurance product, since the life cover comes as an add-on with a conventional product, at mostly nil or concessional rates.''''
According to insurance analysts, over 70 per cent of the policies sold in India are investment-oriented: Pure risk-based products have never been marketed as aggressively as endowment products here.