How Aviva is Challenging the Status Quo and Promoting Healthy Habits Along with Insurance Under Mr. Asit Rath’s Leadership

Aviva’s journey in India. How did it begin?

Aviva has a long history in India, dating back to 1834, when it became the first foreign insurance company to enter the Indian market. However, after India’s independence, Aviva, like many foreign insurers, ceased operations. The company made its comeback in the early 2000s through a joint venture with Dabur, bringing its extensive global expertise in insurance to Indian customers. Today, with a 325-year global legacy, Aviva is recognised for its commitment to life, general, and pension insurance.

How has Aviva evolved over the years?

Since its re-entry into India in 2002, Aviva has served nearly 3 million customers. The company witnessed fluctuations in growth over the past decade but has recently pivoted to a strong upward trajectory. This resurgence is driven by a fundamental shift from a distribution-led model to a product-led approach. By focusing on customer-centric solutions and leveraging digital transformation, Aviva is now experiencing double-digit growth, signalling a new era of expansion and innovation.

What makes Aviva’s product offerings unique?

Aviva is focused on addressing three key financial needs: protection, investment, and pension planning. Its innovative product suite includes:

• Aviva 3D term plan: Unlike conventional term insurance, this plan extends beyond life coverage. It offers financial protection against critical illnesses, cancer and cardiac risks. Its integration of wellness features, including a smartwatch, AI-powered nutrition guidance, and genetic testing, reinforces Aviva’s commitment to holistic financial and physical well-being.
   
• ULIP with zero allocation charges: Understanding the needs of younger investors, Aviva introduced a millennial-friendly ULIP that maximises returns by eliminating allocation charges. If the policyholder passes away, the family receives continued savings contributions, ensuring long-term financial security.
   
• Pension plans with step-up income: As retirement planning gains importance, Aviva’s pension plans provide an inflation-adjusted income, ensuring financial stability for policyholders in their later years.

Are ULIPs still a smart investment choice?

ULIPs (Unit Linked Insurance Plans) have faced scrutiny in recent years, especially with the rise of mutual funds and standalone term insurance as preferred investment options. However, ULIPs remain a compelling choice for long-term financial planning.

Unlike mutual funds, where investors may withdraw prematurely due to market fluctuations, ULIPs encourage disciplined savings with a 15-year average holding period. This long-term commitment allows policyholders to benefit from tax efficiency, lower costs over time, and a combination of insurance and investment growth. Aviva’s modern ULIPs are designed to address past concerns, offering transparency and enhanced returns.

How is Aviva supporting financial awareness in India?

Beyond offering insurance products, Aviva is committed to enhancing financial literacy. The company actively engages in:

• Customer education programs: Simplifying complex insurance concepts through workshops, webinars, and online resources.
• Social media campaigns: Raising awareness about financial planning, retirement security, and the importance of protection.
• Partnerships with educational institutions: Introducing financial education modules to help young professionals make informed decisions about insurance and investments.

Aviva is aligned with IRDAI’s goal of “Insurance for All” by 2047. The company’s focus remains on:

• Innovative and affordable insurance solutions: Expanding its product suite to cater to evolving customer needs.
• Tech-driven growth: Enhancing customer experience through digital-first solutions.
• Financial inclusion: Strengthening its presence in smaller cities and rural areas to bridge India’s insurance gap.

With a strong legacy, innovative products, and a commitment to customer-centric growth, Aviva is well-positioned to redefine the future of insurance in India.

How Does Aviva Tackle Misselling by Brokers and Agents?

Insurance misselling has been a long-standing issue, with some brokers making false promises to close a sale. When I joined Aviva two years ago, we noticed a pattern of misselling complaints, particularly from customers who had been misled by call centre agents working for broking firms.

Despite our efforts to correct these practices, the problem persisted. Ultimately, we made a bold decision—we walked away from this segment altogether. Today, Aviva has no partnerships with brokers who operate through call centres and engage in questionable sales tactics.

However, we recognise the value of ethical brokers maintaining high customer service standards. We are selective in forming partnerships, conducting strict audits of our sales processes, and ensuring that any distributor found engaging in misselling is immediately disassociated.

At the same time, we are vocal about calling out companies that tarnish the insurance industry's reputation. It’s crucial to identify and eliminate bad actors to protect customers and uphold the credibility of the entire sector.

How Widespread is Aggressive Insurance Selling, and How is Aviva Combating It?

Misselling is more common than many realise. I’ve experienced this, being repeatedly contacted by an online platform to purchase a term insurance policy even after having one. Instead of understanding my existing coverage, they simply pushed another policy.

The insurance industry must shift from aggressive selling to need-based advisory to solve this. At Aviva, we leverage technology-driven solutions to ensure that sales conversations focus on customer needs rather than just closing deals.

Key initiatives include:

• Advanced financial calculators: These tools help agents analyse a customer’s financial needs and suggest suitable products rather than blindly selling.
• Data-driven insights: AI-powered assessments ensure that policies are recommended based on an individual’s risk profile, financial goals, and existing coverage.
• Revised commission structures: Unlike traditional models where agents earn a sizeable upfront commission, we are shifting to a structure where distributors earn more over time—as long as customers continue with the policy. This aligns the interests of the customer and the advisor, fostering long-term relationships.

Will distributors accept lower upfront commissions?

Many insurance distributors are accustomed to receiving 30-40% upfront commissions. So, will they accept a new model where earnings are distributed over time?

It’s a strategic choice for distributors. We believe that patient, long-term-focused agents will earn more in the long run with our approach. At Aviva, we are focusing on:

• Attracting new advisors: By working with professionals new to the insurance industry, we can help them build their portfolios with sustainable earnings.
• Developing easy-to-sell products: Simplified and customer-friendly products make it easier for ethical distributors to succeed without resorting to misselling.

Ultimately, fly-by-night operators looking for quick profits may not align with our approach—but those committed to a long-term career in insurance will find it far more rewarding.

Why has India’s insurance penetration remained low?

Despite the insurance industry growing at around 7% annually, penetration remains below expectations. Top consulting firms predicted explosive growth a decade ago, but the reality has changed. Several factors, including low awareness, complex products, and trust issues, have hindered faster adoption.

Is the next decade a game-changer for insurance in India?

Absolutely. This is the best time to be in the insurance industry, especially for young professionals. With IRDAI’s vision of “Insurance for All” by 2047, the industry is poised for transformational growth.

Some industry reports suggest that if India meets this goal, three Indian insurance companies could rank among the world’s top 50, whereas today, only Life Insurance Corporation (LIC) holds a spot.

This next decade is a golden period for life insurance, with stronger industry collaboration and innovative product offerings driving greater penetration. At Aviva, we are excited to contribute to this growth and shape the future of insurance in India.