Marketing uses human psychology well. Harsh realities are sweetened, stated obliquely or the attention is diverted to fringe advantages.

‘You could die suddenly and leave your family on the streets. Better buy life insurance’, translates into dreamy phrases like ‘invest for your son’s higher education/ daughter’s wedding. Yes, this message still persists in settings untouched by political correctness.

Tax saving

‘Save tax’ is another sweetener, as is ‘get handsome returns.’ Both divert the attention from the main purpose of life insurance. The basic message is obfuscated and the seriousness and focus of a simple life insurance policy is diluted and lost. They can also lead to under-insurance as the customer buys life insurance just to meet tax-planning needs and does not take the opportunity to apply his mind on how much money his family will actually need if he is out of the picture.

While one isn’t saying that unpalatable necessities should be scarified to ensure compliance, the life insurance sale and purchase process would benefit from being realistic, level-headed and focussed.

Insurance, especially life insurance, has suffered from over-selling. Life insurance sales is a world by itself in the universe of selling. Marketers are pumped up with sales training, motivational talks, positive thinking techniques and trained for aggressive pitching and tenacity. In perspective, it has probably become a case of familiarity breeds contempt and the customer avoids the unpleasant and pesky nature of this interaction, rather than being able to approach it as a grown-up and rational decision to make. Aggressive and desperate persistence by the seller also makes the buyer feel he is bestowing a favour by the purchase and playing hard to get and trying to bargain are typical reactions. All for a product that he better have and who knows if the need will arise today or tomorrow.

Contrast this with the inception period of life insurance.

Apparently, the underwriters would convene once in a few months to consider the proposals that have come in. Only a select few proposals were accepted and, I am sure, those successful life assureds felt positively blessed!

So, creating demand can work in various ways and maybe life insurance sales should take a step backward and think things through. But the bottom line still is you would be better off with appropriate life insurance.

(The writer is a business journalist specialising in insurance & corporate history)

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