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LIC to aggressively mine for data
Freny Patel in Mumbai |
June 16, 2004 08:56 IST
The Life Insurance Corporation of India is undertaking the country's largest data warehousing project after the Reserve Bank of India. It has roped in Wipro and IBM to undertake the project.
The project's objective is to analyse consumer behaviour and assign a single customer identification number to get a grip on all products owned by a customer -- be it mutual funds, a home loan, or even a bank account with the Corporation Bank.
This will help LIC play more aggressively on the insurance turf at a time when private sector competition is fast expanding its network and eating into the state insurer's marketshare.
The private sector companies have already captured about a 13 per cent marketshare. LIC has a policyholder base of well over 160 million and it sells over 20 million policies every year.
The most ambitious datamining project in the Indian financial sector will be implemented over the next three years. Capturing and analysing consumer behaviour will help LIC chalk out and devise customised insurance solutions as well as evolve new marketing strategies, managing director RK Vashishtha told Business Standard in an exclusive interview.
Today, each LIC policyholder is identified against his insurance policy document number. "The project will give us a holistic picture of our customers, in terms of their behaviour," said Vashishtha.
After assigning a single customer identity number, the corporation will be able to read all his policies. Consumer behaviour analysis will help LIC play a major role in the competitive insurance market.
Since the life insurance industry opened up in December 2000, 11 private insurance companies have entered the fray and have a combined marketshare of 13 per cent.
The consumer behaviour identified through the ongoing exercise of data purification and cleaning would highlight important facets of purchase such as the number of customers going in for loans, paying premium within the due date, and defaulting in premium payments.
By the third year, LIC will be able to undertake datamining across its various arms.