Pranav SIP

A REPORT OF SUMMER INTERNSHIP PROJECT
on
for
by:
PRANAV WARHADY
171977
Date of Completion:
23rd June, 2018
Project Guide:
Mr. Manish Tripathi
Cluster Manager (P.O.S. Vertical)
Bajaj Allianz General Insurance Company
Faculty Guide:
Dr. Shalini Tiwari
Faculty Member,
National Insurance Academy
Market Mapping of Point of Sales P.G.D.M. 2017-19
ACKNOWLEDGEMENT
I take this opportunity to express my indebted gratitude to Mr. G.

Surrendaran, Senior Manager, POS Vertical, Bajaj Allianz General
Insurance Company, without whose encouragement and support,
this project work would not have materialized.
I also take this opportunity to express a deep sense of gratitude to

my project mentor, Mr. Manish Tripathi, Cluster Manager P.O.S.
vertical, Bajaj Allianz General Insurance Company, Pune, for his
cordial support, valuable information and guidance, who in spite of
being busy in his duties, took out time to lend me a patient ear.
I also thank the entire team of Bajaj Allianz at the Regional Office
for their cooperation in every possible way. They have been integral
in making this project a success. I also thank them for making my
and my colleagues’ stay in the organization memorable in every
possible way.
I express my deepest thanks to Dr. Shalini Tiwari who guided me

through each and every phase of my project by giving her valuable
insights and ensured that I followed the correct path to complete
my project.
1 National Insurance Academy, Pune

DECLARATION
I hereby declare that this project titled as ‘Market Mapping of Point

of Sales’ is an original piece of research work which has been
completed by me as an academic work for classroom presentation,
under the guidance and supervision of Mr. Manish Tripathi, Cluster
Manager, P.O.S. Vertical, Bajaj Allianz General Insurance Company
Ltd. and Dr. Shalini Tiwari, Faculty Member, National Insurance
Academy, Pune. The information has been collected from genuine
and authentic sources.
The work has been submitted in partial fulfillment of the requirement

of PGDM program of National Insurance Academy, Pune.
Pranav Warhady
Roll No: 171977

TABLE OF CONTENTS
1. Introduction
1.1 Background 5
1.2 Insurance Penetration in India 5
1.3 Where does India stand? 5
1.4 Reasons for low insurance penetration 7
2. Need for the Study 8
3. Objectives of the Project 9
4. Organizational Profile 9
4.1 Vision 10
4.2 Mission 10
4.3 Values 11
4.4 Organizational Structure 11
4.5 Products 11
4.6 Statistics 13
5. What is Market Mapping? 14
6. Point of Sales an Overview 16
6.1 Guidelines by IRDAI 18
6.2 Difference between ‘P.O.S. Person’ and an
‘Individual Agent’ 21
6.3 Products offered under P.O.S. by
Bajaj Allianz General Insurance Company 22
6.4 Operating Model & Technology 24

6.4.1 Mobile App 25
6.4.2 Q.R. Code 25

6.5 Methodology in Recruiting a P.O.S. 27

6.6 Segmentation 28
6.7 Segment wise Analysis 29
6.8 Mapping the Market and Analysis of Response 32
6.8.1 Field Work 32
6.8.2 Virtual Approach (Agents from other insurers) 34
6.8.3 Customers of Bajaj Finserv Limited (B.F.L.) 35
6.8.4 Cab Aggregators (OLA/Uber) 36
6.9 Incentive Program 36
6.10 SWOT Analysis of P.O.S. 38
6.11 Indian Insurers that have stared procuring
business through P.O.S. 39
6.12 Alternate distribution models tried in Overseas
and Indian Market 39
6.13 Data Storage Guidelines 41
6.14 Advantages of P.O.S. as a new distribution channel 42
6.15 Challenges Ahead 43
7. Recommendations 44
8. Conclusion 46
9. References 47

1. Introduction
1.1 Background
“Insurance is sold and seldom bought’. When we are dealing with intangible products, it
is difficult to persuade the customers to buy our products with their own will. This
possesses a huge challenge for the entire insurance industry, especially in the case of life
insurance and to considerable extent in the case of general insurance. To address this
difficulty, numerous distribution channels have taken birth and are focusing to tap the
untapped.
1.2 Insurance Penetration in India
The measure of insurance penetration and density reflects the level of

development of insurance sector in a country. While insurance penetration is
measured as the percentage of insurance premium to GDP, insurance density
is calculated as the ratio of premium to population (per capita premium).
During the first decade of insurance sector liberalization, the sector has
reported consistent increase in insurance penetration from 2.71 percent in
2001 to 5.20 percent in 2009. Since then the level of penetration was
declining. However, there was a slight increase in the year 2015 (3.44 percent)
and in 2016 (3.49 percent). The level of insurance density reached the
maximum of USD 64.4 in the year 2010 from the level of USD 11.5 in 2001.
During the year 2016, the insurance density was USD 59.7 (USD 54.7 in 2015)
The insurance density of life insurance sector had gone up from USD 9.1 in
2001 to reach the peak at USD 55.7 in 2010. Since then it has exhibited a
declining trend upto the year 2013. During the year 2016, the level of life
insurance density was USD 46.5 (USD 44 in 2014 and USD 43.2 in 2015).The
life insurance penetration had gone up from 2.15 percent in 2001 to 4.60
percent in 2009. Since then, it has exhibited a declining trend up to the year

2014. There was a slight increase in 2015 reaching 2.72 percent and remained
unchanged in 2016.
Over the last 10 years, the penetration of nonlife insurance sector in the
country remained steady in the range of 0.5-0.8 percent. However, its density
has gone up from USD 2.4 in 2001 to USD 13.2 in 2016.
(Source: Swiss Re, Sigma various issues)
1.3 Where does India stand?
Figure 1.
Insurance Penetration in Select Countries (IRDAI Annual Report 16-17)
From the above figure it is evident that the insurance penetration in India is roughly
around 5%, whereas the global average is around 8.5%.

1.4 Reasons for Low Penetration
The reasons for this low penetration may be as follows:
1) Lack of Awareness
2) Products not matching the need
3) India’s low GDP
4) Psychological Barrier
5) Intangible Nature
6) Multiple distribution channels thereby clustering the choice, etc
Many distribution channels have been introduced by IRDAI to ensure that the figure
of insurance penetration crosses double digits.
The following graph casts the overall picture of the Indian Insurance Industry.
Figure 2.
Insurance Penetration in India (IRDAI Annual Report 16-17)
The above figure clearly highlights the trends in life, non-life insurance industry since the
opening up of the insurance sector for the private players. Although there are ups and
downs as far as the life insurance industry is concerned, the non-life insurance sector

seems to have remained on the back foot since 2001. The percentage hovers around 0-
1%.
2. Need of the Study
In view of the fact mentioned above, the Insurance Regulatory and Development
Authority of India (I.R.D.A.I) has introduced a new distribution channel- Point of Sales on
26th October 2015.
The basic aim of this new distribution channel was to facilitate the distribution of those
insurance products that require minimal or no underwriting. So the Points of Sales
Person can be anyone ranging from a grocery shop owner, an automobile service
person, a chemist, an optician, a mobile shopkeeper or a person who specifically
specializes in selling insurance.
This new distribution channel, though is at the nascent stage has tremendous potential
for expansion and is likely to compete with other distribution channels.
Point of Sales (P.O.S.) which was barely introduced two and a half years backed by the
Authority, has to be studied in depth so that a new field force can be created to solicit
business for the insurance company and ensure orderly growth as well as ensure
customer centric attitude of the company towards its prospective customers.
The key issues that needed to be carefully studied while undertaking the project were:
1. Identifying the segments of the market that show a positive inclination for
becoming a P.O.S. for Bajaj Allianz General Insurance Company.
2. To analyze the challenges faced in converting a prospect into a P.O.S.
3. To identify specific pockets in Pune that showed higher inclination for becoming a
P.O.S.

3. Objectives of the Project

a) To analyze the segments that respond positively for becoming a P.O.S.
b) To analyze the root causes that hamper the registration process and hence the
final conversion.
c) To suggest ways to ensure a smooth process right from registration to business
procurement along with POS engagement.
4. Organizational Profile
Bajaj Allianz General Insurance Company Limited is a joint venture between Bajaj
Finserv Limited (recently demerged from Bajaj Auto Limited) and Allianz SE. Both enjoy a
reputation of expertise, stability and strength.
Bajaj Allianz received the Insurance Regulatory and Development Authority (IRDA)
certificate of Registration on 2nd May, 2001 to conduct various businesses (including
Health Insurance business) in India. The Company has an authorized and paid up capital
of Rs 110 crores. Bajaj Finserv Limited holds 74% and the remaining 26% is held by
Allianz, SE.
As on 31st March 2017, Bajaj Allianz continues to be one of the most financially robust
insurers in the industry by maintaining its growth as well as profitability. The company
has made a profit before tax of Rs. 1,078 crore and emerged as the most profitable
insurer recording a profit after tax of Rs. 728 crore. The company reported a GWP of Rs.
7,687 crore, which has grown by 30.3% compared to the last fiscal year.
The company started its operations with a paid up capital of ₹1.10 billion.In the first
year of its operations the company had 36 offices and around 100 employees. Bajaj
Allianz is headquartered in Pune with offices in over 200 cities in India and more than
3,500 employees as of 2018.
The Company lists 97 filed and approved products, of which 27 are health products.

Allianz has operations in over 70 countries and has around 147,000 employees. The
parent company, Allianz SE, is headquartered in Munich, Germany. Allianz has more
than 85 million customers worldwide and its services include property and casualty
insurance, life and health insurance and asset management. In 2013 it was number 25
on the global Forbes 2000 list.
For the 11thconsecutive year, Bajaj Allianz General Insurance has received iAAA
rating from ICRA, indicating the highest claims paying ability and a fundamentally strong
position in the industry. The first accreditation was received in 2005-06 and the
company has maintained this rating since then. The Company has embraced
digitalization as a primary enabler and has been working continuously
on automation and digitization of its service offerings. It offers real time solutions to its
customers and partner via mobile applications and dedicated portals. The industry first
initiatives by the company like cashless claim settlements, in-house health management
team (HAT) and image based policy as well as claim processing, digital offices and
mobile applications such as Eezee Tab and Insurance Wallet have set a benchmark in the
industry. It is the first insurance company in the country to lay the foundation for usage
based insurance through its telematics offering, Drive Smart.
4.1 Vision
To be the first choice insurer for customers
To be the preferred employer for staff in the insurance industry
To be the number one insurer for creating shareholder value
4.2 Mission
As a responsible, customer focused market leader, we will strive to understand the
insurance needs of the consumers and translate it into affordable products that deliver
value for money.

4.3 Values
a) High Standards
b) Customer First, Always
c) Spirit of Adventure
d) Trust
e) Shared Ownership
4.4 Organizational Structure

The Head Office is situated in Pune.
The company has offices including the Regional and Branch offices in 200
cities in India.
Currently around 3,500 employees work in this organization.
It has recently adopted the vertical organization structure.
4.5 Products
On the Retail side the company offers products from the following categories:
Car Insurance Two Wheeler Insurance Travel Insurance

Health Insurance Home Insurance Cyber Safe Insurance

On the Commercial side the products offered are:
Property Insurance Marine Insurance Liability Insurance
Financial Lines Insurance Energy Insurance Engineering Insurance
Employee Benefits Insurance

4.6 Statistics
Number of policies sold by

Bajaj Allianz General Insurance Company in FY 2016-17.
Amount of Premium earned by

Bajaj Allianz General Insurance Company in FY2016-17.
Source: Bajaj Allianz General Insurance Company Annual Report 2016-17

5. What is Market Mapping?
Mapping of the market is considered to be the fundamental step whenever the

company wishes to launch a particular product or study the situation to which the
customers will react when the new product or service is launched. Moreover market
mapping is a study of various market conditions that is plotted on a map to identify
trends and corresponding variables between consumers and products. Market mapping
can help companies locate problem areas and figure out the source of problems by
examining related variables.
Market Mapping not only helps the companies to understand the trends in the local
market but also helps in understanding the areas in which it can improvise itself.
The steps involved in mapping the market are:
Prepare a questionnaire/survey
form/pamphlet to be used
Identify the area to be studied
Choose the people of various professions

to be targeted
Ask specific questions to the people

interwieved
Guage their reaction/response

Mapping the market has its own advantages and disadvantages as explained below:
Advantages:
1) Helps spot the gaps in the market

2) Useful for analyzing competitors
3) Encourages use of market research
Disadvantages
1) Just because there is a ‘gap’ doesn’t mean there is a demand.

2) No guarantee of success
3) Reliability depends on several factors

6. Point of Sales (P.O.S.) – An Overview
Agency
Direct
Moter Dealer
Marketing
Alternate
Channel-
Bancassurance
Travel, Govt,
Agri, CSE
Distribution
Channel
VSO Web Sale
Corporate
Broker
Agency
P.O.S.
To increase insurance penetration in the country, the industry needs more distributors
to travel the last mile. To achieve this goal, what’s needed is a simple certification
process for these distributors. So, to get such distributors on board quickly, the
Insurance Regulatory and Development Authority of India (IRDAI), in 2015, allowed for a
new type of distributor, called the point of sale (PoS) person. Given that these
individuals have a lower qualification and training threshold, compared to other
insurance distributors such as agents, brokers and corporate agents, IRDAI has allowed
these individuals to sell only basic insurance products, which don’t require a lot of
underwriting.

 Mandate for a point of sale person
As per the regulator, products such as motor insurance, travel insurance and personal
accident insurance require very little underwriting as they are based on information
provided by the prospect. Also, such insurance policies are automatically generated by
the system.
Therefore, the intervention required for such products is minimal and the training and
exams for such persons could be of a lesser degree than those for a full-fledged
distributor such as an agent or broker.
In fact, last year in November 2016, IRDAI has also allowed the life insurance industry to
use point of sale persons to sell life insurance products. For this, it identified products
that are simple to understand, and in which the benefits are stated upfront and they are
fixed and predefined.
Accordingly, IRDAI identified pure-term insurance plans with and without return of
premium, non-linked (non-participating) endowment plans that state the investment
benefits upfront and immediate annuity as products that can be sold by the point of sale
persons.
And this year, in order to ensure faster certification of point of sale persons, the
regulator has relaxed the certification programme by allowing the insurers or
intermediaries hiring them to train and examine these individuals in-house.
 A new training programme
Point of sales persons can be engaged either directly by insurers or by intermediaries

such as corporate agents and insurance brokers. The minimum educational qualification

of such persons is Class 10 and they should be 18 years of age at least. Earlier, as per the
rules, IRDAI had appointed the National Institute of Electronics and Information
Technology (NIELIT) to conduct the examination of certificate for point of sale persons.
But in a notification dated 16th March 2017, IRDAI removed this condition. Training and
certification from NIELIT is no longer mandatory. This was done as representations were
made to the regulator that this could hamper quick on-boarding of point of sales
persons.
Accordingly, IRDAI has allowed in-house training by the insurer or intermediary engaging
the point of sale persons. They will have to conduct an in-house training of 15 hours and
an examination thereafter. The insurer or the intermediary will then issue a certificate
and maintain the records for at least 5 years. IRDAI has, however, prescribed a model
syllabus for training purposes.
6.1 Guidelines by IRDAI
On 26th October 2015, this new channel was born and certain guidelines were prepared
by IRDAI to ensure orderly growth of POS. The guidelines are as follows.
I. Point of Sales Person

1. There shall be two types of persons who shall solicit and market insurance policies
namely:
a. Insurance agent or specified persons of corporate agent or broker trained
persons for soliciting and marketing insurance policies or insurance sales
persons of Insurance Marketing Firm or rural authorized persons of CSC-SPV
or authorized person of web aggregators who can solicit and market all types
of insurance policies.
b. “Point of Sales Person” who can solicit and market only certain pre-
underwritten products approved by the Authority.

2. Every “Point of Sales Person” shall be identified by his Aadhaar Card Number or his
PAN Card.
3. The persons soliciting and marketing such pre-underwritten products approved by
the Authority shall be called as “Point of Sales Person”.
4. The “Point of Sales Person” shall be atleast 10th pass.
5. The fees for the online training and examination shall not exceed Rs Five Hundred.
II. Appointment of Point of Sales Person

1. An insurance company or an insurance intermediary can engage a “Point of Sales
Person” to represent him.
2. A “Point of Sales Person” can represent an insurance company or an insurance
intermediary.
III. Products solicited and marketed by “Point of Sales Person”

1. The “Point of Sales Person” can sell only the following pre-underwritten product.
a. Motor Comprehensive Insurance Package Policy for Two-wheeler, private car
and commercial vehicles.
b. Third party liability (Act only) Policy for Two-wheeler, private car and
commercial vehicles.
c. Personal Accident Policy
d. Travel Insurance Policy
e. Home Insurance Policy
f. Any other Policy specifically approved by the Authority
2. Every policy sold through the “Point of Sales Person” shall be separately identified
and pre-fixed by the name “POS – (name of product)”.
3. The insurance company shall file the product with the Authority under the file use
guidelines for information.

IV. Tagging of Proposal Form and Insurance Policy to Point of Sales Person
1. Every proposal form, in paper or in paperless form, insurance policy and other
related documents shall carry provision to record the Aadhaar card number of the
PAN card number in order to tag the policy to the “Point of Sales Person” who is
selling the said policy.
2. The insurance company shall be responsible to record the Aadhaar card number or
the PAN card number of the “Point of Sales Person” in the proposal form and
insurance policy. The insurance company shall be responsible for the conduct of the
“Point of Sales Person” representing him and any misconduct on part of the Point of
Sales Person shall make it liable to a penalty as per provisions of Section 102 of the
Act.
3. For sales effected through the insurance intermediary, the insurance intermediary
shall record the Aadhaar card number or the PAN card number of the “Point of Sales
Person” in the proposal form and require insurance company to do the same in the
insurance policy. The insurance intermediary shall be responsible for the conduct of
the “Point of Sales Person” engaged by it and any misconduct on part of the Point of
Sales Person shall make it liable to a penalty as per provisions of Section 102 of the
Act.
4. One of the factors that shall be considered while renewing the certificate of
registration of the insurance intermediary, shall be the conduct of the “Point of
Sales Person” on the rolls of insurance intermediary.
V. Compliance
1. The insurance companies and insurance intermediaries shall make suitable changes
in their policy administration system to capture the Aadhaar Card number or the
PAN card number details of the “Point of Sales Person”.

2. The “Point of Sales Person” when engaged by the insurer shall place business with
that insurer subject to compliance of rules and procedures of that insurance
company.
3. The Authority shall specify the format and the manner of maintaining returns which
the insurance company and the insurance intermediary shall maintain in electronic
form which can be accessed by the Authority on a remote location basis. The
formats shall give the number of policies sold and the premium collected by the
“Point of Sales Person” on a monthly basis.
6.2 Difference between ‘P.O.S. person’ and an ‘Individual Agent’
Although the ultimate aim to a POS and individual agent remains the same – procuring
business for the company, but they both differ in the types of products that they sell,
the licensing process, etc.
P.O.S. Individual Agent

th th
Education 10 Pass 12 Pass
Training 15 hour In-house 50 hour from IRDAI approved
Institute
Examination Yes Yes IRDAI exam
Validity 3 Years
Type of Products Pre underwritten and All Products
approved by IRDAI
Time required for Minimum Usually less Can take up to 3-5 days depending
issuance than a day on the company
Knowledge level Elementary Intermediate
Policy Issuance Over the Counter (OTC) Through the Insurance Company
Remuneration Commission basis, As approved by IRDAI
similar to individual
agents

6.3 Products offered under POS by Bajaj Allianz General Insurance Company
Currently 23 Non-Life Insurers have obtained the license from IRDAI to sell insurance
products and add on covers through the Point of Sales channel.
According to the data released by IRDA on 18th June 2018, the products and Add-on
policies offered by Bajaj Allianz through Point of Sales channel are as follows:
Products:
Date of PoS
Product
Name of the PoS Product product
Category
Approval
POS- Hospital Cash Daily Allowance Health 24.07.2017
POS- Critical Illness Insurance Health 24.07.2017

POS- Women Specific Critical Illness Plan Health 24.07.2017
POS- Householders Insurance Policy Home 24.07.2017
POS- My Home Insurance All Risk Policy Home 24.07.2017
POS - Global Personal Guard Policy (Individual) PA 16.10.2017
POS-Health Guard Health 27.11.2017
POS-Star Package Health 27.11.2017
Add-On
Date of PoS
Product
Name of the PoS Product product
Category
Approval
POS – Tyre Safeguard under Private Car Package Policy Motor 11.07.2017
POS – Tyre Safeguard under commercial vehicle package
Motor 11.07.2017
policy
POS- Depreciation Shield Motor 24.07.2017
POS- Conveyance Benefit Motor 24.07.2017
POS- Accident Shield Motor 24.07.2017
POS- No Claim Bonus Protector Motor 24.07.2017

POS- Engine Protector Motor 24.07.2017

POS- Vehicle Replacement Advantage Motor 24.07.2017
POS- 24X7 Spot Assistance Motor 24.07.2017
POS- Keys and Locks Replacement Motor 24.07.2017
POS- Personal Baggage Cover Motor 24.07.2017
POS- Accidental Medical Expenses Cover Motor 24.07.2017
POS- Accidental Hospitalization Allowance Cover Motor 24.07.2017
POS- Consumable Expenses Motor 24.07.2017
POS- Conveyance Benefit Motor 24.07.2017
POS- Accident Shield Motor 24.07.2017
POS- No Claim Bonus Protector Motor 24.07.2017
POS- Vehicle Replacement Advantage (Standard Cover) Motor 24.07.2017
POS- Vehicle Replacement Advantage (Exclusive Cover) Motor 24.07.2017
POS- Accidental Hospitalization Cover Motor 24.07.2017
POS- 24 X 7 Spot Assistance Motor 24.07.2017
POS- 24 X 7 Spot Assistance Motor 24.07.2017
POS- Revenue Loss Protection Cover Motor 24.07.2017
POS- Retrieval Cover Motor 24.07.2017
POS- Towing Cover Motor 24.07.2017
POS- Cargo Transshipment Cover Motor 24.07.2017
POS- Vehicle Replacement Allowance (Standard Cover) Motor 24.07.2017
POS- Vehicle Replacement Allowance (Exclusive Cover) Motor 24.07.2017
POS- Keys & Locks Replacement Cover Motor 24.07.2017


POS- Rim Safeguard under Private Car Package Policy Motor 27.11.2017
POS- Rim safeguard under Commercial vehicle Package
Motor 27.11.2017
Policy
Source: IRDAI website
6.4 Operating Model & Technology
One of the first challenges in changing the operating model is the need to separate
product manufacturing and distribution, as the former is measured in terms of
optimized unit costs while distribution seeks to maximize the value of the
relationship for company, distributor and hence the customer. Technology also
needs to be reviewed because many insurers, overly reliant on face to face
distribution have allowed their front office and end user delivery capabilities to lag
those of innovators in their own and other service industries.
Bajaj Allianz has since its inception in 2001, invested huge amounts in harnessing
business through technology. Many mobile applications, web portals have been
designed which have created a win-win situation for the customers as well as the
company.
The various applications of Bajaj Allianz General Insurance Company are:
Insurance wallet, i-inspect, Mobibuzz, BeSafe, etc.

6.4.1 Mobile App
Bajaj Allianz is planning to make full use of mobile technology to canvass business by the
P.O.S. channel. Keeping in mind the prospective people who would be issuing the
policies ‘over the counter’, it is soon going to introduce a mobile application to make the
process simpler. Bajaj Allianz as is aiming to issue a policy within 6 minutes through
P.O.S., technology is going to play a pivotal role in achieving new heights.
The process is as follows:
•Customer
2 min •Aadhaar
approached •Vehicle details Details •Payment
for insurance captured captured details
captured
2 min 2 min
Although Bajaj Allianz is in the final stages of naming its mobile application which will hit
the Play Store in a couple of weeks, it has already started to canvass the vendors,
shopkeepers to enter in the POS business.
6.4.2 QR Code
In a recent study it had been observed that people were reluctant to purchase
insurance, considering the time that it takes to buy and issue a policy. In order
overcome this barrier and to expeditiously issue a policy, Bajaj Allianz has introduced
the QR Code concept for the customers.
The process flow of the QR Code concept is:

Payment is
done and the
Customer scans policy is issued
the QR code
Customer and fills the
approaches the necessary
POS sticks the POS details
QR Code in the
shop
The entire marketing and advertising material is provided by Bajaj Allianz to the POS.
Paytm (by One97 communications) is the first company who started mass usage of QR
Codes.
People have adapted to it quickly and hence a ready market is already in place as Bajaj
Allianz does not have to spend much on educating the customers, how to use the QR
Codes. Few insurers have started considering the potential of the QR Code technology in
insurance in order to leverage customer experience.

6.5 Methodology in Recruiting a P.O.S.

As the aim of introducing this new distribution channel is expeditious issuance of
policies, Point of Sales follows a 4-Step Process:
• Recruitment Planning and Strategy Formation:

This comprises of comprises of recruitment strategy
for identifying the possible people who may be
STEP 1 willing to become a P.O.S.
• Sourcing:
BAGIC Talent Team will directly approach the
STEP 2 potential sources
• Screening and Evaluation:

BAGIC Talent Team will complete the
documentation process and collect documents from
STEP 3 the specified persons.
• Recruitment regulatory process:

BAGIC team will issue POS certificate and deliver the
welcome kit along with the Mobile App to the new
STEP 4 POS.

6.6 Segmentation
Market mapping as discussed before is a study of various market conditions and to

identify the sections of the market that respond positively as well as negatively in order
to deploy the resources of the company in such a manner that the profit of the
company is optimized.
We at Bajaj Allianz primarily fragmented the entire market depending upon the
professions. As becoming a POS is fundamentally related to the profession of the
person, it is necessary to segregate the segments and then focus on a particular
segment.
2-wheeler
Automobile Car accessories
accessories
Computer Training
Coaching Centers English Classes
Institutes
Computer/Mobile
Digital Services Camera Accessories Photo Studios
Accessories
Fashion & Design Apparel Stores Beauty Salon Cosmetic Shops
Insurance
Financial Services Tax Consultants
consultants
Health Care Medical Shops Wellness Shops
Household Kitchen Appliances TV Stores Home Appliances
Hardware/Electrical
Small Traders Grocery shops
shops
Stationary Photo Copiers Offset Printing Art & Crafts

According to the segments shown above, each segment consists of the people of a
particular profession. Each of the above segments were targeted and the results were
analyzed in order to gauge the market response.
6.7 Segment wise Analysis
The responses of the people were categorized as Yes, No and May Be. According the
data was analyzed on Microsoft Excel.
A total of 341 shops were visited across Pune which belonged to the above mentioned
categories. The results were as follows:
a) Automobile: This type included 2 wheeler, 4 wheeler accessories shops, garage, etc.
Total Call : 20
Yes : 3
No : 12
Maybe : 5
b) Coaching Centers: It included English speaking classes, computer training institutes,
etc.
Total Call : 10
Yes : 1
No : 5
Maybe : 4
c) Digital Services: This composed of Mobile store, Camera outlets, Photo Studios, etc
Total Call : 69
Yes : 13
No : 45
Maybe : 11

d) Fashion and Design: This included Jewelry shops, Apparel stores, beauty salon,
Cosmetics shops, etc.
Total Call : 10
Yes : 1
No : 7
Maybe : 2
e) Financial Services: This category consisted of Tax consultants, Loan providers,
Insurance consultants, etc.
Total Call : 16
Yes : 6
No : 7
Maybe : 3
f) Health Care: This major category composed of Medical shops, Opticians, Health and
Wellness stores, etc.
Total Call : 78
Yes : 7
No : 54
Maybe : 17
g) Household: This included Kitchen and Home appliances stores, TV stores, etc.
Total Call : 11
Yes : 1
No : 3
Maybe : 7
h) Small Traders: This category included Hardware shops, Grocery shops, Electrical
shops, etc.
Total Call : 38
Yes : 1
No : 29
Maybe : 8

i) Stationary: This category consisted of Stationary shops, Offset printing shops, etc.
Total Call : 28
Yes : 4
No : 20
Maybe : 4
j) Miscellaneous: This final category consisted of all those people/shops who do not
come under the above-mentioned categories!
Total Call : 61
Yes : 9
No : 44
Maybe : 8
Graphical Representation:
90
Segmentwise Analysis
80
70
In Percentage (%)
60
50
40
Positive
30
Negative
20
10
0
Interpretation: From the above graph it can be concluded that:
1) Financial Services tops the chart in terms of the positive responses generated.

2) Small Traders such as Grocery shops, Hardware shops, etc. are least interested in
becoming a POS which may be attributed by the volume of work that they
already have.
3) Digital Services segments as well as stationary shops were also pretty much
interested (18% and 14% respectively).
4) Automobile segment was also interested, but their major line of business would
be restricted to motor insurance.
5) Health Care segment consisted of Medical Shops, Health and Wellness shops,
Opticians of which high inclination was shown by Medical shops.
6.8 Mapping the Market & Analysis of Response
The mapping of the market for Point of Sales (P.O.S.) was done in 4 ways as illustrated
below:
6.8.1 Field Work
This constituted a major part of our internship wherein different areas of Pune were
identified and according specific segments of that area were tapped/pitched for P.O.S.
This involved explaining the advantages and incentives that a person gets once he
becomes a P.O.S. of Bajaj Allianz. As P.O.S. is itself a new vertical and in the nascent
stage, convincing people to become a P.O.S. was a difficult task. The commission
structure was explained. Accordingly the responses were analyzed in order to identify
the segments that had shown keen interest.
Moreover as P.O.S. is itself created to insure the last mile customer, it was absolutely
necessary to identify those shops/services that are frequently visited/availed by the
customers.

The major idea was to create these shops as ‘Customer Touch Points’ of Bajaj Allianz in
availing general insurance services.
As the fundamental aim of the new POS vertical is to create a new distribution model
for selling insurance, tapping shops was a complicated task. This was because those
people whom we were tapping had absolutely no or only little knowledge about
insurance. Many were reluctant to listen to our proposal.
The observations for field work as follows:
Mobile Phone and Financial Service Providers are the most responding category
in the Vishrantwadi area.
Stores with less footfall and employees with low pay were more interested in this
project.
People with some insurance knowledge showed more positive response.
Many employees were interested but denied further conversation due to

permission issues.
The trigger word for professionals such as doctors, CA’s, advocates was
‘commission’.
The reasons for becoming a POS were:
Prior/Basic Knowledge about insurance

Already an agent, have been associated with BAGIC before.
Authorized Bajaj Dealers.
The reasons for not becoming a POS were:
No need of extra income

Negative perception of Bajaj Allianz due to bitter experience
Lack of Documents
Lack of trust on us (Interns)
6.8.2 Virtual Approach (Agents & Other Insurers)
The virtual approach consisted of calling the agents of other insurance companies to
lure them to become a P.O.S. of BAGIC. The agents belonged to ‘Star Health Insurance’,
‘ICICI Lombard’, ‘Cholamandalam’. LIC, etc.
Along with the field work, the Virtual approach concept was also aimed at ensuring that
basic pre-underwritten products are available to the customers from their agents itself.
The people who were contacted through the virtual approach were already dealing in
the business of insurance. They were agents of private general insurance companies in
India as well as of LIC. Being already with insurance, they were keen to listen about this
new vertical-POS. Further queries like the commission structure were asked by many.
 Agents of Public Sector companies majorly refused the proposal, citing

various reasons mentioned below:
Not interested
No time
No need of extra income
Age Factor
 Few agents mentioned that they get comparatively higher commission

ranging from 20% to 50%.
 Few agents denied the proposal, citing the reason of not getting market.
 Some stated that they already have enough business.
 Already associated with BAGIC agency vertical.

 No longer associated with the insurance industry.
 Document issue
6.8.3 Customers of Bajaj Finserv Limited (B.F.L.)
Bajaj Finserv Limited (B.F.L.) is the Indian counterpart of Bajaj Allianz General Insurance.
It deals in providing personal, car, and other types of financial instruments.
The idea was to explain the benefits of becoming a POS which will serve as a side
income. The data was filtered according to the amount of loan taken, monthly earning
of the person and age. Accordingly people earning less than Rs. 30,000 a month were
targeted.
We explained that as the work of a POS was hassle free as it was completely based on a
mobile app. We also explained by taking a hypothetical situation that their EMI would
be compensated by their own extra efforts should they become a POS of BAGIC.
As these people had no prior knowledge of insurance, this segment was completely not
interested for becoming a POS. Our assumption was that they would be interested
because they would need an extra source of income. But this this assumption proved to
be false.
Our analysis between the Virtual response approach and using the data of BFL was as
follows:
Responses to Agents were more effective than calls made to BFL database.
Probability of Final conversion of existing agents would be greater than BFL

data.
Procurement of Business by agents would be more than the BFL customers.

6.8.4 Cab Aggregators (OLA/Uber)
In order to ensure accelerated growth of the POS business, we targeted the cab drivers
of OLA/Uber. The basic idea was that when a customer boards the cab, and identifies
the poster of Bajaj Allianz, he/she can purchase/renew their policies. This process would
be expeditious and buttery smooth as the customer just has to scan the QR code on the
poster and he then will be redirected towards the web page wherein he has to enter his
vehicle details if he wishes to purchase/renew his motor insurance
Apparently convincing the cab drivers was a much easy task as they would earn a side
income by just putting a poster and getting associated with Bajaj Allianz.
We found that this particular segment had tremendous potential for becoming a POS.
The reasons for this include:
The cab drivers were tech savvy and using a mobile application for selling
insurance was not a difficult task for them.
As the marketing material such as posters, QR code would be provided by Bajaj
Allianz which were self-explanatory, a passenger could easily notic the QR code
and purchase/renew insurance without having to ask the cab driver.
The registration fee was waived for OLA cab drivers so their monetary
investment in this business was effectively zero.
Many accepted our proposal as a means of extra income.
6.9 Incentive Program

For any sales channel to progress, the agency force should be motivated to procure
more business for the company. In order to achieve this objective, Bajaj Allianz had
chalked out a lucrative incentive program. As the maximum commission is fixed by
IRDAI itself, any insurer has hardly any chance to lure its sales force by offering

higher commission. To overcome this barrier, Bajaj Allianz introduced various

incentive programs which are as follows:
1) A trip to Goa if the POS procures a business of Rs. 1,50,000 within 3 months.
2) A trip to Bangkok if the POS procures a business of Rs. 2,20,000 within 3
months.

6.10 SWOT Analysis of P.O.S.
STRENGTH WEAKNESS
1) Suitable for pre-underwritten 1) True potential can only be
products leveraged if done through mobile
App
2) Paperless if done through App
2) Lack of Awarenes of this new
3) A minimum qualified person can
distribution channel
also become a POS
3) Only few types of policies can be
4) Policy issuance in just 6 minutes
sold
4) Chances of fraud as the scrutiny time
of documents is short
SWOT
Analysis
OPPORTUNITES
1) Huge potential to capture the THREATS
untapped market 1) Faces tough competition from the
2) A boon to tap the rural market agency channel which is already
established
3) Many shopkeepers can be
onboarded to become a POS 2) Difficult to change consumer
behaviour
4) Can make tie-ups with computer
institutes, cab aggregators, travel 3) Chances of mis-selling
companies, motor garages, etc.

6.11 Indian Insurers that have started procuring business through POS
As POS is still at a nascent stage, insurers are waiting to guage and caliper the market
reaction towards POS. Though not all have started procuring business through POS,
many insurers include non-life and standalone health have registered the products that
they will be selling through POS with IRDAI.
Among those who have started selling insurance products and Add-ons are:
1) Bajaj Allianz General Insurance Company

2) Reliance General Insurance
3) TATA AIG (On the verge of developing mobile app)
4) ICICI Lombard (In the final phases of selling products through POS)
6.12 Alternate distribution models tried in Overseas and Indian Market
Wal-Mart
1) Ventured into life insurance marketplace with an insurance card

from MetLife.
2) Available for purchase at approximately 200 Wal-Mart Locations

in South Carolina and Georgia
3) The policies were for one year and were sold in colour coded
boxes for different age groups- Blue (18-44), Yellow (45-54), Green
(55-59), Red (60-65).

Costco
1) At Costco, one can shop for auto, home, health, group,

group dental and life insurance.
2) Partnered with Aetna, one of the world’s largest managed

health care services company to offer health insurance
services.
One aspect that appeals its numerous members is the sheer

diversity of goods that can be purchased at very low costs and
insurance policies are included in this company’s vast catalog
of products.
Edelweiss
1) Edelweiss Tokio launched an over-the-counter life

insurance product in India called ‘Edelweiss Tokio Life-Saral
Nivesh’.
Reliance General Insurance
1) It offers customized insurance products including motor,

travel, PA, health and student travel for corporate and
individual customers using a new mobile Point of Sale App.

6.13 Data Storage Guidelines
The Insurance Regulatory and Development Authority of India (IRDAI) has issued a
Circular on Point of Salesperson (POS) Database on 13th April, 2017.
This Circular has been issued pursuant to the amendments issued by IRDAI on the POS
Guidelines on 16th March, 2017, wherein an insurer or insurance intermediary proposing
to engage the POS person has to ensure that the applicant is not engaged as POS with
any other insurer or insurance intermediary by cross checking with the database housed
in Insurance Information Bureau (IIB).
In that context, IRDAI has advised all insurers and insurance intermediaries to upload
the existing database of their POS in the portal & start using the functionalities of this
POS portal as stipulated in the guidelines from 15th April, 2017.
The web link for the POS system is https://pos.iib.gov.in

6.14 Advantages of P.O.S. as a new distribution channel
The new distribution channel has opened up more opportunities for the companies to
tap the uninsured market. The advantages are as follows:
Pre-Underwritten products can be sold over the counter within few minutes.
This significantly lowers the time taken from erstwhile submission of proposal
form to issuance of policy document.
As the education qualification required by IRDAI is minimal, more number of

people (prospective point of sales persons) can be induced in the foray of P.O.S.
channel
The P.O.S. channel coupled with the use of technology such as a mobile app can
leverage the true potential of this channel.
The onboarding time of a Point of Sales person is drastically reduced as

compared to traditional agents which involved a more rigorous process.
Wider network enables the customers to purchase or renew their policies on-
the-go leading to a seamless customer experience.
Industry friendly guidelines about the P.O.S. have enabled people of different
professions to undertake selling of insurance products. So now shopkeepers,
cab aggregators, and many others can source business for the company.

6.15 Challenges Ahead
As it is rightly said, “New doors open both- opportunities and challenges”. Although
P.O.S. has tremendous potential, the challenges ahead should be addressed at initial
stages to leverage the capacity of this new distribution channel.
The challenges before the insurance companies and the industry as a whole are:
Not many people (including customers and insurance advisors) are aware of the
new distribution channel.
As the education qualification and other statutory requirements are minimal, it

can impact the decision of the prospective buyer depending upon how the
product is sold ultimately leading to mis-selling.
As the products are pre-underwritten and not tailor made, chances of adverse
selection are high.
The biggest challenge is to bring about a paradigm shift in the way an insurance
product is purchased.
Not all types of products can be sold through this channel, restricting its use to
only pre-underwritten products.

7 Recommendations
As this a completely new distribution channel which is in its initial phase of
selecting the right mode of delivery, pilot projects should be done in different
parts of the country. The trend shown in Pune will differ from the trend shown
in Patna.
In order to achieve an overall growth for the company, it is necessary for the
company to portray this channel as a ‘difference maker’ from the traditional
channels. It should not happen that the advantages of P.O.S. makes the
traditional channels such as individual agents extinct.
The backbone of the POS channel is to make insurance a pull product rather
than a push product. So appropriate marketing tools such as self-explanatory
posters should be used to a large extent.
Pre-underwritten products sometimes can pose a danger of adverse selection
(i.e. If the risk is not inspected at its own merit), so appropriate care must be
taken leveraging the use of technology.
It was observed that the focus was on the individual agents that already deal in
insurance business. Perhaps looking at the flexibility of the guidelines
prescribed by IRDAI, people from other professions such as shopkeepers, etc.
should be targeted more aggressively.
It is difficult to make a shopkeeper sell insurance products primarily because a
shopkeeper himself deals in tangible products, so selling a ‘promise’ may be a
difficult task for him. Apart from the compulsory training that is provided by the
company, training sessions should be conducted at regular intervals.
It is necessary for the P.O.S. to remain motivated so engagement programs and
lucrative benefits should be offered.
Looking at the current scenario which has seen some standardization in the
non-life sector, pre-underwritten products will be a norm for all lines of

business especially in the retail sector. So more types of products have to be

brought into the foray of POS, instead of restricting to Motor, PA, Travel, etc.
The cost of procuring business from a customer is comparatively less than other
distribution channels, so the benefit must be passed on to the customers. This
will encourage people to buy the products from a POS and will naturally gain
volumes.
This channel will create wonders if it is marketed in a more aggressive way in
the rural market. Currently no product is offered for the rural customers, so
appropriate pre-underwritten products should be designed keeping in mind the
needs of our rural folks.
Launching a completely new channel is difficult for any company altogether. So
to encourage people to purchase insurance products through this channel,
discounts should be given for a few months.
Eg. This similar strategy is adopted by giving a digital discount to the customers
purchasing policy online.
The company must decide on what it is looking for from this distribution
channel. Broadly speaking, the question will be whether the product has gone
to the market at a lower cost and achieved the desired purpose.
As the company is focusing on leveraging technology, in the initial phases it
should select those customer-touch-points taking into consideration the buying
behavior of the younger generation and later mover towards other age groups.
There should be more customer engagement programmes, so as to encourage
customers to make renewal purchases from P.O.S. distribution channel.
For example, quizzes/games can keep the customers engaged. The points
earned by the customer can be utilized to make renewal purchases.

8 Conclusion
As mentioned earlier, the penetration of insurance in India is quite low as compared to
other countries, and one of the key reasons for this is the lack of trained professionals
who can be employed as agents or distributors be it for a simple product like motor
insurance or travel insurance, or for more complex insurance solutions like ULIP. The
P.O.S. can majorly cater to these lines of business.
Moreover, from the analysis of segments those respond positively for POS proposal,
signifies that the company has a steady market as far as financial services industry is
concerned. The company should channelize its resources for tapping other segments
such as Digital Services, Automobile, and Health Care among others.
Although, to achieve the underlying aim for which POS is built, it is necessary to shift the
focus in other segments. This will not only help the company to reach the last mile but
will also help in shifting the mindset of the prospective customers.
It is of prime importance that the onboarding of the new POS should be as smooth as
possible. Many prospects are hesitant to become a POS due to lack of documents. The
kinks can be removed by leveraging technology and making use of Aadhaar.
At the same time it is necessary for the company to maintain transparency during the
entire process which inherently instills confidence and a sense of responsibility for the
prospective Point of Sales.
The job of the company does not end when a POS is on boarded. Imparting training and
teaching the POS to sell right products to the right customers should be institutionalized
in the minds of the Point of Sales Persons.
In this dynamic era of minds, P.O.S. can hence bridge the gap between the insurance
industry and the people at large.

References:
Websites:
http://www.businessdictionary.com/definition/market-mapping.html
https://www.renewbuy.com/blog/general/4-benefits-becoming-point-of-sale-pos
https://www.livemint.com/Money/5m5n0Amanb8eg1sawwtyaO/Role-of-a-point-of-
sale-person-in-insurance.html
https://www.financialexpress.com/industry/banking-finance/point-of-sales-person-to-
help-curb-misselling-of-insurance/160276
https://www.irdai.gov.in/ADMINCMS/cms/Circulars_List.aspx?mid=9.10.1
https://www.lexplosion.in/irdai-advises-all-insurers-and-insurance-intermediaries-to-
upload-the-existing-database-of-their-pos-in-the-portal
Newspapers:
Financial Express
Times of India
Annual Report:
IRDAI Annual Report 2016-17
Bajaj Allianz General Insurance Company Annual Report 2016-17
Swiss Re, Sigma various issues

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A REPORT OF SUMMER INTERNSHIP PROJECT

I take this opportunity to express my indebted gratitude to Mr. G.

I also take this opportunity to express a deep sense of gratitude to

I express my deepest thanks to Dr. Shalini Tiwari who guided me

1 National Insurance Academy, Pune

I hereby declare that this project titled as ‘Market Mapping of Point

The work has been submitted in partial fulfillment of the requirement

2 National Insurance Academy, Pune

6.4 Operating Model & Technology 24

3 National Insurance Academy, Pune

6.5 Methodology in Recruiting a P.O.S. 27

4 National Insurance Academy, Pune

1.2 Insurance Penetration in India

The measure of insurance penetration and density reflects the level of

5 National Insurance Academy, Pune

1.3 Where does India stand?

Insurance Penetration in Select Countries (IRDAI Annual Report 16-17)

6 National Insurance Academy, Pune

1.4 Reasons for Low Penetration

The reasons for this low penetration may be as follows:

Insurance Penetration in India (IRDAI Annual Report 16-17)

7 National Insurance Academy, Pune

2. Need of the Study

2. To analyze the challenges faced in converting a prospect into a P.O.S.

8 National Insurance Academy, Pune

3. Objectives of the Project

9 National Insurance Academy, Pune

10 National Insurance Academy, Pune

b) Customer First, Always

4.4 Organizational Structure

Car Insurance Two Wheeler Insurance Travel Insurance

11 National Insurance Academy, Pune

Health Insurance Home Insurance Cyber Safe Insurance

Property Insurance Marine Insurance Liability Insurance

Financial Lines Insurance Energy Insurance Engineering Insurance

Employee Benefits Insurance

12 National Insurance Academy, Pune

Number of policies sold by

Amount of Premium earned by

Source: Bajaj Allianz General Insurance Company Annual Report 2016-17

13 National Insurance Academy, Pune

5. What is Market Mapping?

Mapping of the market is considered to be the fundamental step whenever the

The steps involved in mapping the market are:

Identify the area to be studied

Choose the people of various professions

Ask specific questions to the people

Guage their reaction/response

14 National Insurance Academy, Pune

1) Helps spot the gaps in the market

1) Just because there is a ‘gap’ doesn’t mean there is a demand.

15 National Insurance Academy, Pune

6. Point of Sales (P.O.S.) – An Overview

VSO Web Sale

16 National Insurance Academy, Pune

 Mandate for a point of sale person

 A new training programme

Point of sales persons can be engaged either directly by insurers or by intermediaries

17 National Insurance Academy, Pune

6.1 Guidelines by IRDAI

I. Point of Sales Person

18 National Insurance Academy, Pune

II. Appointment of Point of Sales Person