Ek Samvaad - "Startup Strategies" Chintan P. Mehta in conversation with Rakesh Jain CEO, Reliance General

It is always delightful to interact with industry intellectuals and get your work assessed from their perspective. It’s a good fact check for course correction. Thanks to Kunal, Deepak and Shrish, I got one such opportunity to meet with Mr. Rakesh Jain, MD & CEO, Reliance General Insurance Co. Ltd.

Though I do have very good rapport with Mr. Jain whenever we meet socially, seldom do we get a chance to meet without any agenda. Visiting him at their new corporate office was one such instance.

I have been following Mr. Rakesh Jain ever since he took charge of Reliance General way back in 2012. One of the toughest times for a leader, I must say. Reliance General had a massive trust deficit during those days at the customer as well as the intermediary level. No doubt some went up to the extent to term this move of his as suicidal. But, the outcome of these 10 Years of efforts are impressive and a learning story for Industry fellows.

Step by step and brick by brick, the way he has carved Reliance General is a story to be shared. Today I am not going to talk about that, let us keep it for some other day.

Discussions which I had with him can be inspiring for so many insurances, insurtech startups and can help in decoding their future course of action which I would like to share with all of you today…

"STARTUP STRATEGIES"

Develop Long Term Partnerships:

Do not look into short term associations and gains. Always invest into long term relationships as insurance is a very peculiar business. One needs support from an insurer especially in scenarios where you have adverse loss ratios. It is well understood that the distributor does not have control over the Loss Ratio beyond certain limits. In such instances you need support from an insurer, and if you are not with them for a long-term basis, it becomes extremely difficult to survive and sustain.

If you are always moving from one partner to another for short term gains, you will feel deserted in such times. Better to have strong alliances to stick along in thick and thin.

Create Value for Your Clients:

As an intermediary your utmost priority should be towards creating a value proposition for your clients. Try and sell what is right for your client. In insurance sales, it is extremely important to analyze the need prior to advising. Generally, we sell what is random, what is regular but one should be ready to take certain pain to get into the customer’s shoes before advising.

This can go a long way. The Customer appreciates the value proposition proposed and that will give you credibility over others which helps in retention. Retention is extremely vital in insurance sales. Here felt Mr. Jain’s thoughts echoed my quotable quote… “Enhancing the Value Proposition Should be the core of your Startup”

Adopt Vertical Growth Strategy:

Startups always gets confused in adopting a reliable growth strategy. To Grow Horizontal or Vertical confuses most organizations. As per Mr. Jain, in insurance it is better to focus on vertical growth. A vertical growth strategy means scaling product/services inside an existing market. You can add products to supplement existing sales. It allows you to go deeper into existing market/clients.

As per Mr. Jain, it is always advisable to engage existing clients on multiple products rather than scouting for new clients every day. Yes, you need to create a capable workforce to do so as this looks easier said than done.

Invest into LOB’s with Long Tail:

Focus on the Line of Business which gives you long sustainable revenues. In today’s market practice most players in insurance domain are eyeing for short term gains and acquisitions. This can be very fragile.

It is better to invest into products which are renewable, where chances of retention are higher. This may be not be the short cut to the top but the definite way for sure.

In Insurance, Health and Life Insurance products are good bets in creating a long tail.

Do not invest heavily in I.T.:

This is a big No Zone as per Mr. Jain. Insurance companies have invested very heavily on I.T. infrastructure. To try and develop one’s own system at an intermediary level is just the duplication.

Just because everyone is doing it, doesn’t make it right. Most intermediaries are making this mistake these days. No need for duplication. Investing heavily on I.T. could be a big black hole in your company’s strategy. Don’t fall prey to it.

Insurance companies have robust I.T. infra, make use of it. Create a front/landing page which understands your client and vice versa is good enough at an intermediary level. Insurance company may not know your client profiling, preferences etc. On board them on your page and divert to respective company is a smart move. Focus on your core and leave the rest to the Insurer.

Being a late entrant is a Virtue:

Here comes one more out of the box thought from Mr. Rakesh Jain. We always believe that the first mover gets enormous advantage. We all try and think one new idea to bring it first and win the race.

Mr. Jain has a contrarian thinking, as per him an innovative late mover can learn from the pioneer’s mistake. They are at a sustainable advantage as late movers have the opportunity to check how well a new product is received in market and design the strategy accordingly.

So, all the startups who feel they missed the boat should not be disheartened. It’s all about placing your bets rightly. You are at the right place at the right time!

At the end, Mr. Rakesh Jain concluded politely, “hamara kaam hai gyaan dena, achcha lage to lo”. (I personally feel, lena chahiye because his gyan is well earned)