Insurance Distribution, Marketing and Customer Service
Insurance Distribution, Marketing and Customer Service
This domain tests distribution channels, ethical marketing, suitability and service standards.
Core rules
- Channels: individual agents, corporate agents, brokers, bancassurance, direct online, web aggregators and micro-insurance agents. Each has licensing, training and conduct requirements.
- Marketing: segment customers, design suitable products, advertise fairly and avoid misleading promises. Needs analysis and suitability are central.
- Commission: pay only as permitted; disclose commission where required; rebating is prohibited.
- Customer service: proposal processing, policy issuance, endorsements, renewal, claims, complaints and policy servicing.
- Grievance redressal: internal grievance redressal, Insurance Ombudsman and consumer forums.
- Data and conduct: protect customer data, record complaints, avoid mis-selling and false urgency.
Worked example
A customer says an agent sold a unit-linked policy promising "guaranteed 12% returns" and offered a gift for signing. The benefit illustration showed 4% and 8% scenarios, not guarantees. The agent also failed to disclose commission. This is mis-selling and rebating. The insurer should investigate, cancel or refund as per policy, take disciplinary action against the agent, and report the conduct breach. The customer should be directed to grievance redressal and the Ombudsman if unresolved.
Traps
- Confusing commission with illegal rebating.
- Ignoring suitability and needs analysis.
- Promising guaranteed returns.
- Not disclosing commission or product risks.
- Failing to record and escalate complaints.
- Sharing customer data without consent.