Every reporter: Tu Yinghao Every editor: Liao, Dan
As the life insurance market enters the era of 3.0% predetermined interest rate, various insurance institutions have launched new products, and new products based on savings insurance have attracted much attention, including increased whole life insurance with a fixed interest rate of 3.0%, annuity insurance, and dividend insurance combining fixed and floating income, and various critical illness insurance and medical insurance products have also innovated.
The shift between old and new products has undoubtedly brought great changes to the life insurance market. For insurance institutions, it is necessary to take the pulse of market changes and provide diversified products to meet customer needs, so as to better meet changes and seize new growth opportunities.
Photo courtesy of the interviewee
Change brings challenges, opportunities and challenges coexist. Despite the impact of the reduction of product interest rates and the "integration of newspapers and banks" in the bancassurance channel, life insurance premiums will still maintain a steady growth momentum in 2023 and are ready to go. 2024 is about to begin, what kind of mainstream products will be in the life insurance market? How will the life insurance market evolve in the 3.0% era? Under the general trend of "product + service", how should insurance institutions seek differentiation and better stimulate customer demand? For these questions, Liu Yuqing, marketing director of China Pacific Life Insurance, recently accepted an interview with the reporter of "Daily Economic News".
The product mix will change
In 2023, most life insurance market players, including CPIC Life, will take the initiative to control the cost of liabilities, actively prevent long-term interest rate risks, and complete the switch of scheduled interest rate reduction products in a smooth and orderly manner.
Liu Yuqing said that pension wealth insurance products provide customers with a longer and more stable choice of pension insurance products, and their relative competitive advantages are significant. At present, various insurance companies have adopted a differentiated competition strategy in pension wealth products, from the perspective of mainstream product forms, including 3.0% predetermined interest rate increase whole life insurance, annuity insurance and other ordinary products, continuing the product highlights before the switch, but also including participating annuity insurance business, sharing the results of participating insurance business with customers, and meeting the wealth management and pension inheritance needs of customers of different ages and different risk preferences.
Looking forward to the evolution of the life insurance market pattern in 2024, Liu Yuqing believes that the product structure of the industry will undergo certain changes, but this change will not be too drastic, but a relatively slow process. "Although the scheduled interest rate has been reduced by 0.5 percentage points, the increased whole life insurance will still occupy a large share of the market, but the market share may decline to a certain extent compared with 2023; ”
Under the new market changes, what remains unchanged is the increasing insurance awareness and protection needs of customers, and health insurance such as medical insurance and critical illness insurance will still be an important part of the future life insurance market.
"Based on market research, we found that there is still a strong demand for health protection products in the market. However, from a consumer perspective, they may not fully recognize the differences between Million Medical Insurance and Critical Illness Insurance in terms of product features and customer needs. This requires a process of consumer education. In fact, the two products are quite different in terms of explicitness, and they play different functions and roles when dealing with unexpected risks. Liu Yuqing believes that if the industry can continue to improve its professional capabilities and better describe the functions and differences of different health insurance products, I believe they will maintain their due market position and product share.
From the perspective of market supply, Liu Yuqing said that the leverage ratio of traditional critical illness insurance is relatively low, and it is less attractive to older customers. In order to better meet the diverse needs of customers, all companies are currently innovating, iterating and upgrading critical illness insurance products, and in the field of health protection, it is believed that there will be some major product changes. For example, in 2023, CPIC Life Insurance will launch a new generation of critical illness products, through the deep integration of production and services, using the "chassis + component" approach, with higher protection leverage and more customer choices, providing customers with a full-process, integrated and customized "product + service" comprehensive solution.
The industry further promotes high-quality development
With the disappearance of the demographic dividend of the life insurance industry and the acceleration of the transformation of traditional business models, how to turn the "crisis" into an "opportunity" and seize the opportunity for growth in the life insurance industry is what life insurance practitioners are looking forward to.
"Some of the challenges encountered by the industry as a whole are related to the extensive development methods in the past. In Liu Yuqing's view, through some internal and external changes, the entire industry will be promoted to develop in a better direction. "From purely sales-based thinking, salesforce-based thinking, to customer-based thinking, which will bring some changes to the supply side of the industry. At the same time, the industry will gradually shift its focus to customers, which will also change the means of service and the interface for customers. ”
"Nowadays, we no longer launch products in stages, but have a relatively rich product system from the beginning, so that customers can adapt their products in our product system. Liu Yuqing said that it is foreseeable that from the perspective of the market and customers, the industry will show several trends in the future.
First, customers are more rational and put forward higher requirements for the quality of products and services of insurance companies. In today's economic recovery foundation is not yet solid, industry fundamentals and residents' employment income are under pressure, superimposed on agent ecological reshaping and other factors, the consumption preferences and behavioral Xi of the main insurance customer group have changed. Customers are becoming more rational in their consumption decisions and more focused on the products and services themselves.
Second, customer needs are more diversified, which poses a challenge to the diversification of products and services. With the aging of the domestic population, the proposal of the construction of the national multi-level security system, and the successive introduction of the personal pension system, customers have diversified needs for health, pension, wealth and other aspects in addition to purchasing basic insurance products.
The third is the importance of brand image and recognition. With the rise of self-media platforms such as Douyin and Xiaohongshu, customers have more ways to learn about insurance companies, and tend to choose brands with better reputation and more trust. The brand is an important window for customers to contact and understand insurance companies, and improving brand recognition means having a better market reputation and user stickiness, so as to attract more customers and form a virtuous circle.
In the form of mainstream products represented by increased whole life insurance, annuity insurance, and critical illness insurance, in Liu Yuqing's view, the ideal product structure in the future will move towards 40%, 30%, and 30% diversified development.
In addition, 30% of the insurance products are annuity insurance products, which can meet the needs of the elderly customers in the aging society in the field of pension, and 30% are health protection products represented by critical illness insurance, which can play a role in the protection of insurance in critical illness or medical treatment. Liu Yuqing said that moving towards the product structure of 433 is a challenge for the industry and insurance companies, because it has a certain challenge to the business philosophy of insurance companies, which is different from the inertial thinking and practice of excessive product concentration in the past.
In Liu Yuqing's view, the supply of a variety of products and better attention to customer needs have also put forward higher requirements for industry sales personnel. Therefore, moving towards the ideal product structure requires the joint efforts of the entire industry.
He expects that the life insurance industry will further promote high-quality development, continue to return to the original intention of insurance, return to the origin of protection as the direction, the future life insurance market product types will be further enriched, critical illness insurance, medical insurance, accident insurance, annuity insurance, whole life insurance and other products will still have a corresponding market scale, on the basis of ordinary products, dividends, universal, investment-linked products diversified supply will be strengthened, for specific customer groups specific needs of differentiated products will be more and more abundant.
Product + service is both an opportunity and a challenge
In recent years, insurance institutions have increased their layout in the fields of pension, health, medical care, etc., and it can be expected that the future competition in the life insurance market is no longer limited to product competition, but also service capacity competition.
"In the past, it was not enough to rely on products alone to solve the risk solution for customers, and product + service is actually a comprehensive solution for customers. Liu Yuqing said that in this process, how to effectively combine services and products to better meet customer needs and provide better comprehensive solutions, whether it is in the face of wealth management, pension, major diseases or medical demands, is an obvious and important demand.
In Liu Yuqing's view, service is a long-term performance process, which has a certain similarity with products. "We know that insurance products have a set of rules and regulations to regulate their long-term performance ability in risk management, but in the service field, the long-term performance risk management of the service itself may be the focus of the industry. We call this the productization of services, i.e., the management of insurance services as if they were insurance products. On the one hand, we want to see service promote the consumption of products, and on the other hand, service is also a kind of commitment to customers. How to ensure the future service delivery capability, the effectiveness of service supply, the controllable risk in the process of service performance and the better customer experience are all aspects that we must think about and act seriously from the perspective of product + service. ”
"Product + service is both an opportunity and a challenge for the industry. In his view, how to turn challenges into opportunities requires in-depth thinking from the perspective of the industry, rather than simply considering the logic of "service is used to promote product sales". Since 2022, CPIC Life has continued to explore the integration of production and services, using multiple rounds of customer insights to understand customers' pain points and itching points for products and services, and at the same time incorporating services into all aspects of product research and development, so that products and services are more compatible, and integrated design and research and development of products and services have been realized.
It cannot be ignored that in the years of active transformation of the life insurance industry, major insurance institutions have actively built their own pension and health ecology, continuously empowered the insurance product side, and have played a 1+1>2 effect.
Liu Yuqing believes that in the future, from the perspective of product supply, the difference between large and medium-sized insurance companies and small insurance companies is relatively small, and in the service field, different types of insurance companies will be very different. In his view, the diversity of services is broader than the diversity of products, and the iteration and upgrade of services may be more rapid than that of products. Because this depends not only on the development of the industry itself, but also on the changes in the supply of services brought about by changes in other service industries such as the field of elderly care and health.
From the perspective of the mode of service input, in his view, if it is only through the asset-light mode of procurement integration, whether the controllability of future service supply is guaranteed, whether the efficiency is better, and whether the cost is lower, in fact, it may be relatively difficult in the case of asset-light. If the insurance company is through self-construction and equity investment, the services provided may be more confident and confident. "This is not only a test of the capital injection method in the process of the construction of the entire service ecology, but also a test of the hard power behind the insurance company, and in the end, there will be a big difference in the content of the entire service ecology. ”
In the future, who can integrate richer and higher-quality service resources, match accurate services for segmented customers, and gradually build an industry-leading production and service system, can stand on the high ground of competition in the life insurance market.
National Business Daily
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