Policybazaar business model, marketing strategy

Policybazaar business model

We all know that life is uncertain and getting insured provides safety to our belongings and loved ones. Analyzing this fact, many people invest in their long-term security by buying an insurance policy which can be life insurance, health insurance, car insurance, and many more.

And to make these insurance policies easily accessible to a large number of people, the insurance web aggregators are elevating their presence through the medium of the internet. Today, we will study the working structure and strategies of India's leading insurance web aggregator: Policy bazaar. The sub-content followed by the topic is-

  1. About insurance web aggregator: Policybazaar
  2. Policybazaar business model
  3. How Policybazaar earns?
  4. Policybazaar marketing strategy

About insurance web aggregator: Policybazaar

Policybazaar is an online intermediary that depicts a large number of insurance policies listed by various companies. It brings in transparency between the clients and the insurance providers by listing valid policies with complete data and price structure.

Apart from transparency, it works as a useful platform for the customers to book a valid insurance plan after doing a comparison among a large number of policies listed. A comparison helps the users to find the best policy as per their budget, duration, and various other factors.

Back in early 20s, people have lost their trust and faith in insurance industries because at that time they were not having internet facilities and they were looted by insurance agents by charging a high commission or selling them fake plans. Now, it is the era of internet, a person can get adequate knowledge for a certain insurance plan and can avail the service online.

So, to offer a one-stop solution for all the insurance aspirants, Policybazaar launched its online service that showcases life insurance, investment plans, health insurance, motor insurance, and others. It gives a user-friendly interface that allows you to enter a few details, explore various plans, make a payment, and get yourself register as a policyholder.

Policybazaar business model

Policybazaar is an insurance web aggregator that simply means it works as online middlemen between the insurance providing companies and customers. And when we hear the term middlemen we feel a bit unsure about the company. But, don't worry because Policybazaar is approved by IRDA which regulates the insurance industry and aims at protecting the interests of customers.

Now, talking about the Policybazaar business model then it revolves as a three-way structure which includes insurance companies, insurance seekers, and itself.

Insurance companies- There are more than 50 companies that are listed on Policybazaar and each one of them features attractive insurance policies. These large number of policies gives a variety to customers for choosing one of the best policy for him. Otherwise, it won't be possible to explore the number of policies offline.

Aggregator- Now, the Policybazaar is the online aggregator that reveals various policies listed by different organizations. It reveals all the policies and plans that are issued by insurance companies.

Customers- The customers land into Policybazaar by following a user-friendly interface from the website or online application. And after that one would buy a certain policy as per his requirements.

How Policybazaar earns?

Now, after reading about the Policybazaar business model, you might to curious to know how it earns? Talking about the earnings then it earns on various parameters listed below:

Annual charges- Most of the revenue is generated from insurance companies that have listed their policies. It charges a flat fee as a part of the annual rate from them. These annual charges are issued by the IRDA which is the same for every product listed.

Commission based- Apart from the annual charges, it makes money from the policies sold to the customers. The companies that are listed on its platform pay a certain amount as a commission which may vary with the type of plan and policy. But the commission is mostly less than 30% of the price of a policy.

Policybazaar marketing strategy

As it runs operations in the Indian market and the Indian communities are mostly fascinated by TV advertisements. So, it has budgeted 80% of its marketing expenses for TV ads. It runs most of its TV campaign by roping in some of the famous celebrities and showcasing an interactive scenario that how the insurance policies are beneficial?

Firstly, it derives in a need for insurance and then tries to manipulate the viewers to buy the insurance plans. They target deep with the emotions of viewers through its advertisements. As one of its attractive taglines is :

"Mehna nahi hai- Policybazaar"

For targeting a price-sensitive Indian market, they run their advertisements very cleverly. And also telecast a similar advertisement in which it tries to promote and aware audience that you must compare insurance before buying which is carried out with a catchy message:

"Compare nahi kare ga toh bane ga ullu"

It simply means that one should buy after contrasting various plans and provoke the viewers to study various plans on its platform and then buy.

Take away

From this reading, we formed a deep comprehension of Policybazaar followed by the Policybazaar business model, marketing strategy, and its revenue model. We got a complete insight into this insurance web aggregator that is India's biggest insurance player and how it manages to build a prominent position in the market.

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