Ethics in insurance: Building relationships through trust

The 'long-term' will belong to the company which rigidly benchmarks ethics for itself and the industry.

Mumbai: The momentum of the private insurance sector leaves no doubt in my mind that it is amongst the foremost growth sectors of our country. A market share of 26.18 per cent in five years is testimony to this. But even while we brace ourselves to avail of the numbers within our sight, we need to realise that the 'long-term' will belong to that company which rigidly benchmarks ethics for itself and for the industry. In a business such as ours, where the customer entrusts us with his / her financial savings, ethics has a direct relation to sales. The greater the trust, the more the sales.

There are many ways to build trust through ethics, the most fundamental being the way the product is designed. It should offer complete clarity and transparency and the literature supporting the product should not over-promise the benefits or understate the risks. At Birla Sun Life, the use of the sales illustration, the inclusion of the policy proposal form, and the free look period we offer have served to win our customers' trust. By giving customers the option to track investments online and by publishing the performance of the funds against benchmark indices, specifically prepared for us by CRISIL, we prove that we are an open and reliable organisation.

Ethics is an attitude that needs to touch every aspect of the customer relationship. It entails having great reverence for the customer's needs, being open to suggestions and insights that might enhance his / her comfort levels, building in riders and flexibility options that address these needs, providing assistance and clarity in documentation and upgrades, and settling claims on time. Ethics means being fully accountable, not just to the company and to its customers, but to the industry we serve. The inspiration for ethics thus comes from the highest source — from a need to impact the industry.

On the flip side, a lack of ethics can have serious consequences. Litigation and costs of settlement, business losses, a reduction in ratings, and increased scrutiny are not half as damaging as the loss to image and reputation. It's a fact that good ethics makes good business sense. Of course, the mandate for good ethics always stems from the top. Which explains, why at Birla Sun Life, we have introduced a system of checks and balances that guards against concealment and why we follow norms of compliance and adhere to IRDA regulations so scrupulously that our books and processes are open to audit at all times.

While top management can lay down a code of ethics and request adherence, its implementation depends on the individual. As Albert Einstein said, "Ethics is an exclusive human concern without any superhuman authority to back it." To this I add: Ethics is that discipline, that momentum that challenges us to rise above ourselves and raise the bar each time we interact. It is the means by which we measure ourselves, the strength by which we progress, and the light by which we shall be remembered. It is the way ahead - for each of us and for our industry.

*The author is CEO, Birla Sun Life Insurance Company Limited