| Distribution Channels of TATA AIG -
June 15th, 2008
The winds of liberalization initiated vast changes in the functioning of the industry today. Increasing number of multinational partnership with private insurers have paved the way for a radical shift in insurance selling- through a number of new distribution channels besides bringing about more awareness on the need for insurance and also stressing on the important role technology can play.
In the developed markets, many insurers have a preferred mode of distribution (e.g., agents, brokers or bancassurance, DSA). In India, many players are hedging their bets because the need for scale outweighs considerations of focus and because non-agency distribution, which is presently operational for the last two years forms a basis for study.
Tata AIG has a corporate agency channel, which handles its corporate agents and have tie-ups with 38 corporate houses.
Insurers want to lower distribution costs by finding more efficient channels. The new private players are developing multiple channel models; many insurers use or plan to use several banks as distributors. Because most banks have strong regional bias, in this regards Tata AIG has agreement with HSBC( corporate agency distribution) through that it is doing both life insurance and general insurance business..
Because most banks have a strong regional bias, Insurers can use several banks without creating large overlap. Many larger banks are sourcing products from several insurers acting as manufacturers.
An important distribution challenge facing insurers is the need to meet the rural and social sector legislative requirements stipulated in terms of market opening. For Tata AIG, it takes rural insurance as an opportunity and not an obligation. For achieving objective in rural area it has also tie with NGOs(Bridge stone for Karnataka and Kerala).
In this project mainly focus is distribution channel of Life Insurance of Tata AIG and little bit of distribution of General Insurance of Tata AIG also. So as the whole topic of distribution can be known for the both company of Tata AIG ( Life and General insurance). Gradually channels are incorporating day by day for the growth of business.
In the span of two to three years Tata AIG achieve much more business growth what it expected at the time of entrance in Indian market. It happened because it has quality people, innovative management, be able to employ technology effectively besides having right products with effective and modern distribution channel. | 
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