The economic activities can be divided into three main categories - Primary, Secondary and Tertiary. The primary activities include agriculture, fishing, forests and mining. The secondary activities include agriculture, construction, and industry. The tertiary activities include services like insurance, banking, finance, transport, communication etc. The list of services include utilities, civil, insurance banking, defense services, transport etc.
In LIC, life insurance service are rendered with a view to protect the people against the risk of loss due to accident, fire, death, sickness, unemployment and so on.
Some people might argue that there is service marketing, but only marketing in which the service element is greater than the product element. We do agree that, in the sale of majority of the goods, there are both a product part as well as a service part. However, there are so many service organizations like insurance companies, banks, transport companies who do not think of themselves as marketers of goods. They see themselves as providers of services.
Definition of Services
The term service has been differently defined by different authors. According to Ivanovic, "Service is the work of dealling with customers, or payment for the work, services are benefit which are sold to customers or clients such as insurance, transport and educationa". According to Philip Kotler, " A service is an activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything. Its production may or nay not be tied to a physical product".
Characteristics of Life Insurance Services
Life insurance services, as described above, have a number unique characteristics that place them in separate category compared to physical goods. These characteristics create special marketing challenges. They are given below :
1. Intangibility : Llife insurance services are intangible in nature. It is quite different fromm other commercial products. The consumer has to have faith in the services of life insurance provider. Services are intangible and therefore, cannot be seen, felt or tasted. The customer has to be encouraged, enthused and helped to visualize the unforeseen tomorrow and usefulness of a life insurance products. Unlike tangible products, there are no factories and production lines for life insurance.
2. Heterogeneity : Life insurance services are heterogeneous in their nature. That is, they are highly variable. Each life insurance product of the service i some what different from other products of the same services. Different kinds of insurance products are developed from time to time to cater to the specific needs of customers.
3. Inseparability : Very often services cannot be separated from their provider. It is very important to understand the heart and soul relationship between product and service, cost and quality. Life insurance products continues to exist over a long period of time, and for making its service available, the insured person has to go on paying the purchase price (premium) through out the term of the policy. This ensures that the benefits already accrued under sale are not lost. Hence due to inseparability, direct sale of services, is the only channel of distribution. In LIC, insurance agents represent and help in promoting inseparable services.
4. Changing Demand : The success of life insurance service marketing in turn depends on the ability of the firm to find a customer and to satisfy his wants. For this purpose instead of trying to sell what can be produced the business firm should produce what is really needed by the customer and what would satisfy his wants. It is a buyer's market, by and large, the seller i.e. the LIC has to take decision whether to sell a particular policy to particular person or not on the basis of information disclosed by the buyer himself in the proposed form.
In LIC, life insurance service are rendered with a view to protect the people against the risk of loss due to accident, fire, death, sickness, unemployment and so on.
Some people might argue that there is service marketing, but only marketing in which the service element is greater than the product element. We do agree that, in the sale of majority of the goods, there are both a product part as well as a service part. However, there are so many service organizations like insurance companies, banks, transport companies who do not think of themselves as marketers of goods. They see themselves as providers of services.
Definition of Services
The term service has been differently defined by different authors. According to Ivanovic, "Service is the work of dealling with customers, or payment for the work, services are benefit which are sold to customers or clients such as insurance, transport and educationa". According to Philip Kotler, " A service is an activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything. Its production may or nay not be tied to a physical product".
Characteristics of Life Insurance Services
Life insurance services, as described above, have a number unique characteristics that place them in separate category compared to physical goods. These characteristics create special marketing challenges. They are given below :
1. Intangibility : Llife insurance services are intangible in nature. It is quite different fromm other commercial products. The consumer has to have faith in the services of life insurance provider. Services are intangible and therefore, cannot be seen, felt or tasted. The customer has to be encouraged, enthused and helped to visualize the unforeseen tomorrow and usefulness of a life insurance products. Unlike tangible products, there are no factories and production lines for life insurance.
2. Heterogeneity : Life insurance services are heterogeneous in their nature. That is, they are highly variable. Each life insurance product of the service i some what different from other products of the same services. Different kinds of insurance products are developed from time to time to cater to the specific needs of customers.
3. Inseparability : Very often services cannot be separated from their provider. It is very important to understand the heart and soul relationship between product and service, cost and quality. Life insurance products continues to exist over a long period of time, and for making its service available, the insured person has to go on paying the purchase price (premium) through out the term of the policy. This ensures that the benefits already accrued under sale are not lost. Hence due to inseparability, direct sale of services, is the only channel of distribution. In LIC, insurance agents represent and help in promoting inseparable services.
4. Changing Demand : The success of life insurance service marketing in turn depends on the ability of the firm to find a customer and to satisfy his wants. For this purpose instead of trying to sell what can be produced the business firm should produce what is really needed by the customer and what would satisfy his wants. It is a buyer's market, by and large, the seller i.e. the LIC has to take decision whether to sell a particular policy to particular person or not on the basis of information disclosed by the buyer himself in the proposed form.
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