There are many different types of insurance marketing campaigns in the world but one that is currently widespread in India is the use of SMS as a marketing tactic. This presents a lot of issues especially when received by a clueless investor who does not have the knowledge pertaining to the insurance industry. This is the reason why it is important nowadays for insurance marketing campaigns to be regulated in the country.
There are a number of reasons why rules and regulation should be imposed. Let us take for example the text messages sent. There is no way that a product as complex as a life insurance can be explained clearly with the use of only 160 characters. Another thing to consider is that majority of the texts sent are actually misrepresentations of the actual life insurance being offered to policy holders. Let’s take a look at other factors why this marketing practice of insurance companies should be regulated.
The SMS is presenting a contrast which can be misleading to the consumers reading the texts. They tend to overly emphasize the returns one will be able to earn when availing the product by comparing the amount of savings with the final corpus. Take a look into the following text message: “Get 13.12 lahks on maturity after investing Rs. 2,859 monthly. Tax saved will be below 80C. For more info, contact XXX”. With this example, the big difference between the 2,800 and the 13.12 lakhs can be a compelling factor which would not have the same effect if they stated that 34,000 annually will result to a final corpus worth 13.12 lakhs.
The next issue is that there is no time frame stated. This is a clever strategy because the time frame is a big factor in what could result to an abysmal return. Another problem is that there is nothing about death benefit. This kinds of omit the purpose of a life insurance which is to cover your family in case of any untoward accident happening to you. While there are many other effective and transparent insurance marketing campaigns used by brands through digital marketing, it is obvious that SMS is not the best way to do it.