At a time when the insurance sector in India is raking up losses, Bajaj Allianz recorded the best ever profit for FY 2014-15 under the sterling leadership of Managing Director and CEO Tapan Singhel.Corporate Citizen caught up with the dynamic head honcho on insurance, leadership and life!
If you consider the Indian economy, the priorities were different earlier. Consider our parents. If they could educate their children, build one house and buy one car, they would consider that they had achieved their life’s financial objectives. There would not be any surplus income after these investments. If you look at today’s generation, there is a lot of surplus income. They are able to buy a house and a car by the time they are 30. If you look at human psychology, once people secure the essentials, then the next segment they invest in is brands. They buy the BMWs, Louis Vittons, Audi’s etc. Once they splurge to their hearts’ content, then they look at what essentially should have been a priority investment – security. Our earlier generations concentrated on just making ends meet, today’s Gen-Y is spending on brands as well as diverting whatever disposable income they have on insurance. Today, our purchasing power is on the rise and with that, there is a tendency to turn towards insurance. India is still grossly under-insured, but thankfully, the situation is fast changing. In my estimation, in the next 20-30 years, the number of insured persons will match global numbers, or close to them at the very least.
Actually, I think it’s the opposite. The insurance industry as a whole loses more money than it makes, because we pay out more claims than the revenue we make. During the Jammu & Kashmir floods and the Hudhud cyclone in Andhra Pradesh, we settled claims worth Rs.962 crores in a three-month period. In fact, we had set up a special toll-free helpline number and a special team to handle all claims and related assistance cases in the affected areas. So the industry is customer friendly and we understand that during a crisis, the process of settling claims has to be speedy and transparent. The criticism that the industry received is due to old policy conditions. When insurance was new in India, there were policy conditions that would be obsolete in today’s day and age. Let’s say that someone took an automobile policy. Automobiles use a lot of fiber parts, as opposed to metal parts used decades ago. The depreciation on plastic and fiber is 50 percent. When a customer files a claim for Rs.1 lakh and gets Rs.60,000, he feels cheated. But the reality is that is what he paid for. In this case, the expectation gap for the customer was huge. The challenge for the industry is to make products simple. The customer needs to be explained what he or she is buying, and the same has to be delivered when the moment of truth comes. Customer delight is what is going to take the insurance industry to the next level.
If you look at Bajaj Allianz, we are one of the most profitable companies in this sector, and we are also capturing market share. I believe in the philoso phy that if you are obsessed about your customers, obsessed about delivering value to them, the customer is happy to purchase your product. As a company, our obsession with not just our customers but also our employees is high, and that results in greater efficiency internally and an enhancement of brand perception amongst our customers, which translates to higher sales and increased profits.
It’s good to own up. A company should always be genuine, honest and straight. A crisis can come, sometimes due to your own mistake, and other times due to external factors. The important thing is not be unfair or unethical. Whatever the case, when a crisis comes your way, stand up and own it. Genuineness towards your customers, standing up where you have goofed up and taking corrective actions are the only things that can work.
‘Never be afraid of failure. i failed in my B.Sc and then went on to top my class at m.Sc. Failure is not the end. it teaches you a lot of things. Do not worry too much about failing. Worry about not trying.’
When I started using social media, many people urged me not to do it, because they felt that there will be no buffer and that people could post whatever they felt like. The reality, however, is that the role of the CEO has changed. It is no longer about being on the top of the pyramid and sitting aloof, it is about sitting with the masses. Today the pyramid is inverted and the customer is at the top. The CEO is the embodiment of the company. If people feel that the CEO does not speak with them, is not responsive, or not a genuine human being, they will not go for the company’s product. Times have changed now, and the glamour of being a CEO has gone. The CEO must appear completely approachable and humble and only then will people interact with him or her.
I love spending time with my daughters and my wife. My family is the most precious thing to me and unfortunately, due to my hectic work schedules, I have not been able to devote as much time to them as I would have liked. But I make the best of the time I get. This is something I would like to convey to young sters. I asked some youngsters what they do when they reach home by 6.30-7 p.m., and they said watch TV with the family. What kind of family time is this? It’s not about the quantity of time you spend with your family, but about the quality of it. Even if I spend one hour with my family, I don’t think of anything else while I’m doing that. Time is an asset, make sure you don’t waste it.
I love to travel. Also, it is one of the necessities of my job. I love traveling in India. I think our country has a lot of beauty that can satisfy any kind of traveler. If you love deserts, you can go to Rajasthan. If you love to ski, the slopes of Gulmarg can match Switzerland. India has something for every kind of traveler.
Absolutely. Don’t worry too much about where you are going, just sit back and make the most of your journey. When I started off, I wanted to be a scientist, and accidentally landed in the insurance sector. When an opportunity comes, grab it even if it wasn’t in your initial game plan.
I also want to advice students to never be afraid of failure. Youngsters are under so much pressure these days, and some don’t even hesitate to try to commit suicide when they fail. I want to share something. I failed in my B.Sc and then went on to top my class at M.Sc. Failure is not the end. It teaches you a lot of things. Do not worry too much about failing. Worry about not trying.
When you make it into your career, be humble. Don’t be enamored by power and position. Just be passionate about what you can do. Don’t get too obsessed about the results. Challenge the status quo and come up with solutions that benefit the customer.
By Neeraj Varty
