Child Space

Food for Thought

Need of Child Space

Food for Thought

Why There is a need of Child Space ? :

• Lets understand the same from a study done by AC Nielsen.

Food for Thought

Dependent Get a Job Have Kids Family Life Empty Nest Retired

Learning to Save

Aspiring Home Owner

Home Equity Builder

Wealth Consolidator

Accessing Property Wealth

Wealth Diversifier

DEPENDENT TEENAGERS

LOWER YOUNG

COUPLESLOWER NO

KIDS

LOWER FAMILIES

LOWER NOT RETIRED

LOWER RETIRED

MIDDLE CLASS

FAMILIES

INDEPENDENT YOUNG SOLOS

YOUNG COUPLES

YOUNG AFFLUENT PARENTS

AFFLUENT FAMILIES

AFFLUENT NO KIDS

AFFLUENT NOT

RETIREDAFFLUENT RETIRED

MATURE SOLOS

So

cio

-Eco

no

mic

Sta

tus

HIGH

LOW

Global Learning's

Financial requirements are more aligned to Life-Stage

Food for Thought

Awareness of Financial Product Categories

Figures in %

100 9997

92

89

Life Insurance Debt Investment Other Investment Non Life Insurance Equity Investment

Base: All respondents (7367)

Life Insurance lead the pack with universal awareness across different Investment products. Awareness of equity products is the least.

Food for Thought

100 9997

92

89

Life Insurance Debt Investment Other Investment Non Life Insurance Equity Investment

Base: All respondents (7367)

Awareness of Financial Product Categories: Life Insurance

Figures in %

9585 82

80

59

Traditional Plan Child Plans Pure/ term Plan Pension Plan ULIP

Traditional plans like ( endowment/money back) are most known Life Insurance policies, however ULIPs are the least known Insurance Policies.

Food for Thought

Life Stage: 7 Financial Ages

“I really don’t want to deal physically with the bank, everything

should be electronic.”

“I save almost nothing and spend all I earn, so I need instant

access to my money.”

Spending Years - Youth

Needy Years - Married

“No one tells you how expensive married life is going to be. We need loans for

everything – a car, household goods, the list never ends.”

“I am dependent on my parents for all my monitory

needs .”

Dependent Years - Adolescent

Responsible Years – Married w/ at least 1 kid

“We need good-value investment options to save for our children’s education and future.

We’d like to have our own house & we need a loan for that.”

Settlement Years – Married with adult childrenWe need finance for our children’s education & good investment options to save for our retirement.”

Worried Years – Couples w/ married children“We need finance for our children’s marriage & good investment options for our forthcoming retirement.”

Peaceful Years – Retired

“We get what we need from our previous investments & pensions.”

X - Not covered in Life 2008

X

X

Food for Thought

All

Spending Years

Needy Years

Responsible Years

Settlem

ent Years

Worried Years

Base 7367 1589 1240 3441 980 95

NETT : TOTAL LIFE INSURANCE 100 99 99 100 99 100

Life Insurance- Traditional/Endowment/Money back 95 95 95 95 94 95

Life Insurance- Child Plans 85 85 82 86 83 81

Life Insurance-Pure/term insurance 82 85 83 81 79 77

Life Insurance- Retirement/Pension 80 85 79 80 76 64

ULIP/Life insurance 59 66 59 58 54 50

Netts Non Life 92 93 90 93 90 84

Health Insurance 88 89 85 89 86 75

Accident Insurance 82 86 81 83 80 63

Insurance Awareness Levels – Lifestyle Stages

Figures in %

INSURANCE AWARENESS

ULIP & retirement plans have the higher level of awareness in people from Spending years, however child plans awareness is higher amongst people from responsible years.

Food for Thought

All

Early Adaptor

s

Mid Adopt

er Late

adaptors LIC

Other private Players

Base 7367 1898 2420 662 3028 512







Netts Non Life 92 96 93 95 95 98



Product Awareness Levels – Adoptiveness & Ownership

Figures in %

INSURANCE AWARENESS

Awareness level amongst early adopter is higher as compared to other category of people , however there is no major differentiation in awareness level amongst LIC & Private policy Owner.

Food for Thought

All Top 8 Metros

Other metros North East West South

Base: 3382 1975 1407 746 541 1090 1005

Money back Insurance 97 98 95 97 97 97 97

Endowment Insurance 85 92 75 83 88 80 89

Child Plans 85 95 71 78 84 85 91

Retirement /Pension Plans 80 90 65 77 79 79 82

Term Insurance 78 85 68 66 80 80 84

Unit linked Insurance Plan (ULIP) 57 68 41 52 41 58 68

Awareness Levels – Centre wise

Awareness levels for all types of policies higher in South, However ULIP is low on

awareness across all centers, particularly in east.

North has comparatively lower awareness of policies.

Figures in %

Food for Thought

63

23

15

9

25

9

97

85

85

80

78

57

Money back Insurance

Endowment Insurance

Child Plans

Retirement/Pension Plans

Term Insurance

ULIP

Spont Total

Figures in %

Policy Awareness: Spont &Total

Base: All Respondents (3382)

Money Back and Endowment are most aware life insurance products, whereas ULIP is the least aware in pecking order.

Food for Thought

But what is the reality ?

• The fact is, although the awareness for securing child’s future is very high but penetration is very less…

Food for Thought

66

4538

15 10

Life Insurance Other Investments Debt Investments Non Life Insurance Equity Investments

Base: All respondents (7367) Figures in %

44

2111

10 4

Traditional Plan Pure/ Term Plan ULIP Child Plan Pension Plan

Penetration of Financial Product Categories: Life Insurance

Traditional Plans is the most penetrated product among insurance products followed by Pure/Term Plans

Traditional plan has highest penetration in Kolkata(69%). However ULIP has highest penetration

in Ahmadabad (21%)& Bangalore(17%)

Food for Thought

National urban penetration of Child Plan (10%)

Within Age groups

22-30 yrs: 7%

31-40 yrs: 14%

41-50 yrs: 11%

Note: Above figures do not add to 100% since these are a reflection of that measure “within the particular SEC/ Age group”

Category Profile: Life Insurance ( Child Plan)

Within Zone

North: 9%

South: 8%

East: 13%

West: 12%

Within Town class

Top 8 metros: 10%

Mini Metros: 9%

Within Life stages

Spending years: 2%

Needy years: 5%

Responsible years: 16%

Settlement years: 12%

Worried years: 2%

Within Adopters

Early Adopters: 13%

Mid Adopters: 11%

Late Adopters: 7%

Fig in %

Food for Thought

Figures in %

Conversion ratio from awareness to penetration Life Insurance

46

12

26

5

19

Conversion Ratio

Traditional Plans( Endowment/Money back) has the highest conversion ratio, which is quite low in pension plans & Child plans

Food for Thought

Future Intent: Child Plan

10%

90%

Child Plan Non-Holders Child Plan Holders

15

85

0 20 40 60 80 100

Future Intentfor Child Plan

holders innext 12months

Yes No

Base: Child Plan holders - 556

6

94

0 20 40 60 80 100

Future intent forChild Plans Non-

Holders in next 12months

Intend not to buy

Intend to buy

Base: Child Plan Non-Holders : 4837

Total % planning to invest in Child Plans in next 12 months = 6 %Base: All respondents (7367)

Fig in %

Food for Thought

FUTURE INTENTION IN LIFE INSURANCE All

Spending Years

Needy Years

Responsible Years

Settlement Years

Worried Years

Base 7367 1679 1138 3394 942 179







Netts Non Life 5 6 3 5 4 11



Future Intent (Life Insurance)–– Lifestyle Stages

Figures in %

Future Intention to purchase LI is higher amongst respondent from Spending years & worried years.

Food for Thought

Preference - type of Policy

Money Back Insurance

Term Insurance

Endowment Insurance

ULIP

Child Plans

Retirement/Pension Plans

Fig in %

Base: All Respondents (3382)

Money Back Insurance Policy enjoys highest preference among types of policies, on the other hand ULIP has very little preference

Food for Thought

In Sum: Future Purchase Intention

Future Purchase Intention

Only 42 % of people are intending to invest for next 12 months

Life Insurance has highest future purchase intention :30%

Traditional Plans:17%

Child Plans: 6%

Other Investments: 13%

Gold :7%

Debt Investments: 11%

Bank Fixed deposit :11%

Food for Thought

Current Trend in the Market :

• All the Insurance Companies are targeting this segment as an independent category.

• Lot of Ad & media activities are happening.

Food for Thought

Major Products available :

Kotak

Star Child

Head Start Assure Wealth

Head Start Future Protect

AvivaLittle Master

Young Scholar

Bharti Axa Bright Star

BajajYoung Care

Young Care Plus

Food for Thought

Major products available …(2)

Birla Sun Life Childrens Dream Plan

HDFC

Unit Linked Young Star Plus II

Unit Linked Young Star II

Young Star Champion

ICICI

SMART Kid Single Premium Plan

SMART Kid New Regular Premium Plan

Food for Thought

Major products available…. (3)

TATA Ujjwal Bhawisya

SBI Unit Plus Child Plan

Sahara Sahara Ankur

Reliance Secure Child Plan

LIC Children Future Plan

Food for Thought

Major products available…. (4)

Max New York Life SMART Steps & SMART Steps Plus

HSBC Child Plan

MetLife Met Little Star

Star Union Daichi Prabhat Tara

Food for Thought

What Max New York Life is doing ?

Food for Thought

Plan of action :

• Focus “Child” as a category.

• Highlight the importance of saving for Child’s future.

• Do a proper “Fact Finding” to understand the need of the prospect.

• Use rule 72 to calculate the increasing cost of Education, higher education & foreign education.

Food for Thought

Thanks!

Child Space

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Transcript of Child Space