A matter of life and death

After remaining dormant in the media space for a period of nearly 40 years, Pakistan’s life insurance sector is witnessing a lot of activity with at least three companies ratching up their advertising visibility.

Life insurance has an interesting history in Pakistan, beginning in 1972, when the government nationalised the sector under the Life Insurance (Nationalisation) Order and 32 life insurance companies were merged under the State Life Insurance Corporation (SLIC). Then, during the first phase of privitisation in 1992, private life insurance companies were once again allowed to operate. EFU Life was the first to restart operations in November 1992, followed by The Metropolitan Life Assurance Company (now East West Life Assurance) in 1993, Alico (now MetLife Alico) in 1995 and Commercial Union Life Assurance Company (now Jubilee Life) in 1996.

While SLIC dominates the life insurance sector with a whopping 70% market share, EFU Life and Jubilee Life have captured 15% and eight percent of the market respectively. Together, the three companies account for 93% of the market; the remaining seven percent is shared by Adamjee Life, Asia Care Health, East West Life Assurance, MetLife Alico, and two takaful (Islamic insurance) companies: Dawood Family Takaful and Pak-Qatar Family Takaful.

In spite of these developments, 2010 figures from the Securities and Exchange Commission of Pakistan (SECP) show that insurance penetration (percentage of insurance premiums to GDP) in Pakistan was just 0.32% of GDP (for context, India’s was at four percent of GDP) and insurance density (annual per capita insurance premium) was only three dollars (India’s was $50).

One of the major reasons for this low density and penetration is the 20-year nationalisation of the insurance sector, which severely curbed the industry’s pace of growth, and although private companies have been operating in this space for almost two decades, rebuilding from scratch has neither been quick nor easy.

Mohammed Ali Ahmed, Chief Strategy Officer – Deputy Executive Director, EFU Life Assurance explains that it took the company six years to break even because “setting up life insurance requires investment in developing the infrastructure as well as the sales network.” He adds that “other companies took 15 years to break even.”

Even as private life insurance companies have grappled with developing infrastructure, improved and more varied product offerings and a sales strategy that goes well beyond SLIC’s standard life insurance agents (insurance is now sold through agents as well as banks, the latter option is known as bancassurance), creating awareness about insurance brands, plans and pricing has been neglected.

Murtaza Zafar, Marketing Manager, Jubilee Life explains that most people remain unaware of the fact that broadly speaking there are two types of life insurance – standard life insurance and life insurance with an element of savings (for education, marriage, retirement etc.) and that some plans have a premium as low as Rs 1,200 a year.

Keeping these factors in mind, three life insurance companies have started brand building and awareness campaigns as a first step to communicate their message to the general population. According to Ahmed these campaigns will help when the company’s insurance agents reach out to customers so that people are at least aware of the brand.

Here is a brief overview of the latest advertising initiatives by three life insurance companies:

1. EFU Life

Almost 15 years after the company restarted operations in Pakistan, EFU Life was the first life insurance company to advertise in 2008 with a mass media campaign that changed the company’s tagline from ‘because life is precious’ to ‘zaroori hai’ (roughly translated: ‘it’s necessary’).

The radio campaign used social messages to highlight the importance of life insurance, for example, ‘giving way to a passing ambulance is important, as is life insurance’ and was designed to create awareness about EFU’s brand and plans. Although the campaign didn’t garner many customer calls, people began to recognise the brand.

As Ahmed says, “When our representatives approached customers they were more receptive because they had heard of the EFU brand and had seen our communication.”

EFU has continued this campaign solely on radio for the last few years and in June the company decided to tailor the radio message for a regional audience and translated it into Seraiki, Punjabi and Sindhi.

Ahmed says the sustained radio advertising is a result of the lesson learned from the first campaign.

“If you have a controlled budget and want to make an impact, the best medium to use is radio.”

2. Jubilee Life

Following its rebranding from New Jubilee Insurance (NJI) to Jubilee Insurance in October 2011, Jubilee Life put up a provocative billboard in January 2012 proclaiming ‘we have plans to die for’.

Zafar says the idea was to ‘grab attention’. Although the billboard grabbed plenty of attention especially in the blogosphere (so much so the company came out on top of Google’s search engine) most of the attention was not very positive and the billboard was scrapped.

However, this was not the end of Jubilee’s foray into advertising and in April 2012, the company launched a mass media campaign with the tagline, ‘what you can’t predict, insure’ highlighting various worst case scenarios that need to be insured against.

Although the major objective of the campaign was to create awareness, the variety of situations showcased gave people a sense that life insurance goes beyond death, and also offers savings plans.

3. State Life Insurance Corporation

Of all the life insurance advertising ever done in Pakistan, State Life’s 1976 ‘aye khuda meray abbu salamat rehain’ campaign is definitely the most memorable. The campaign has evolved over the years but in April the company used the exact same tagline in a new mass media campaign which also includes cinema advertising.

Shahid Aziz Siddiqui, Chairman, State Life Insurance Corporation, explains the reason for this revival:

“We felt that the theme defined State Life and that we should reintroduce it to a new generation of people.”

Although State Life’s corporate campaigns are intermittent (this recent mass media campaign coming after a hiatus of two years), the company regularly does a radio programme aimed at creating awareness about its own plans and life insurance in general.

Additional reporting by Vanessa D’Souza.