SWOT ANALYSIS

The SWOT analysis is an extremely useful tool for understanding and decision-making for all sorts of situations in business and organizations. SWOT is an acronym for Strengths, Weaknesses, Opportunities, threats. The SWOT analysis headings provide a good framework for reviewing strategy, position and direction of a company or business proposition, or any other idea.

A SWOT analysis is a subjective assessment of data which is organized by the SWOT format into a logical order that helps understanding, presentation, discussion and decision-making. The four dimensions are a useful extension of a basic two heading list of pro's and con's.

The SWOT analysis template is normally presented as a grid, comprising four sections, one for each of the SWOT headings: Strengths, Weaknesses, Opportunities, and Threats. The SWOT template below includes sample questions, whose answers are inserted into the relevant section of the SWOT grid. The questions are examples, or discussion points, and obviously can be altered depending on the subject of the SWOT analysis.

SWOT analysis of MetLife India Insurance:

STRENGTH:

The major Strength that MetLife India Insurance enjoys is that is MetLife is a leader in Insurance sector with a 137 years of experience in the insurance field and also a leader in many of the countries. Its great network, channels also plays a very crucial role in its development in India. More over its joint venture with other partners like J&K Bank, Dhanalakshmi Bank, Karnataka Bank, Karvy Consultants, Geojit Securities, Way2Wealth, and Mini Muthoothu, with their great network also add a lot of strength to its armory. MetLife has a multi channel approach to distribution and is well capacitised on the individual and group side of business. The financial advisors working in the agency sales channels and their tie- ups through banks and corporate agents on the third part distribution arrangements. The vast banking network represents the opportunity to penetrate the market place. The direct sales force is geared to do the talking on the employee benefit space and also work through brokers in this space. MetLife also have an approval to market insurance through a

telemarketing channel. Thus unlike other players in the market who have tie ups with little known other players MetLife has a greater links and thus brings in a lot of opportunity in the Indian insurance sector. In India the bancassurance model is still in its nascent stages, but the tremendous growth and acceptabiluity in the last three years reflects green pasture in future. The deregulation of the insurance sector in India has resulted in a phase where innovative distribution channels are being explored. In this phase, bancassurance has simply outshined other alternate channels of distribution with a share of almost 25-30% of the premium income amongst the private players. A bancassurance alliance results in lower infrastructure and manpower costs. In India, the local regulations are encouraging the development and promotion of this channel. Also, banking in India is mainly done in the brick and mortar model, which means that most of the customers still walk into the bank branches. This enables the bank staff to have a personal contact with their customers, which is very essential for insurance selling. The bank network - especially the public sector and cooperative bank branches are spread across the length and breadth of the country with 65,000 plus branches. This enables the insurance companies to reach out to each and every individual in the country who needs life insurance.

WEAKNESS:

Though MetLife India Insurance has many tie ups with the huge banks and others sectors it itself has less branches of its own. At present MetLife India Insurance has only 44 offices across 29 locations all over India. Where as ICICI prudential has more then 500 branches all over India. More over the market visibility of MetLife is not very great there are only countable commercials, advertisement and other promoting agents. Though in Insurance sector the challenge has been in earning the trust of the consumer, in building a brand in a market which is so diverse and yet distinct. Moreover, educating the consumers are the biggest problem that this sector faces, and the market is not fully educated about the MetLife and its product so the main problem that this company is facing is market visibility.

Opportunities:

India has averaged about 21% of GDP over the last five years. The market is expected for greater improvement in savings among Indian households going forward, aided by the sharp decline in the age dependency in India, which implies that the proportion of the working population and subsequently, the savings rate increase. Low Penetration: Total life insurance premiums collected in India were US $15 bn in F2004, or 2.3% of GDP. This compares with the penetration of 11% in Taiwan, 7% in Korea and 3.5% of GDP in Malaysia. On of the key reasons for low penetration in India was the fact that insurance was primarily sold as a tax planning product until private players were allowed entry into the segment. Private players now provide a savings angle to the product (by introducing unit-linked products) and have introduced new distribution channels ( e.g. bancassurance), which has resulted in a pick up in growth for the entire industry. Prior to F2001, life insurance in India was largely taken for tax saving purposes and products offered were traditional endowment products. However, with the entry of private players, the products offering changed significantly. Private players pushed unit-linked products, leading investors to look at insurance as a saving too. LIC relies almost entirely on its agent force to acquire policies. But MetLife and other private life insurance players in the market introduced alternate distribution channels for the acquisition

of policies, enabling them to increase penetration. Beside that MetLife also has a vast range of products for the Indian market it has all together of 17 products highest for any private life insurance company in India only LIC has more products then MetLife with a total of 45 products.

Number of products offered by Private Players:

ICICI pru HDFC standard life Allianz Bajaj Life AVIVA Life Birla Sun Life Max New York Life Om Kotak Mahindra ING Vaysa SBI Life

11 8 12 11 14 8 12 5 8

Threats:

Firstly, MetLife is an international company and in order to put itself into a good position it needs to find out what are the basic needs of Indian customers so that it can design its products as for the needs of the people. Which could sustain for a long time? Moreover, though the rural sector poses many opportunities for life insurance, there are many challenges that exist in the market. Limited infrastructure facilities in terms of banking, access to information, telecommunications and low presence of medical facilities are some of the hurdles that one has to overcome. The best way to tap the rural market is to partner with establishments/ communities that have a significant presence there. More over increasing number of rivals are also a big threat for MetLife India Insurance as they tend to take up the

market share. Like ICICI prudential has a ULIP policy called Life Time Super and similar to that MetLife has Met Smart Plus and Met Suvida, but since ICICI has a brand Image much clearer then MetLife thus people tend to go for ICICI prudential. Thus product differentiation is also one of the threats.