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Promoting strategies followed by RICBL

Introduction Insurance sectors in Bhutan are playing vital role for the people in Bhutan to ensure the risk of people. While in early 1960s barter System played a dominant role. Common people were absolutely unaware of the concept of Insurance. Oriental Insurance Company Ltd, a public sector insurance company of India set up one branch office in Phuntsholing around 1971. It was the beginning of insurance business in Bhutan. Only general insurance activities were carried out by the same company. Thereafter, Royal Insurance Corporation of Bhutan was established in 1975. It started functioning both as Life Insurer and General Insurer. RICBL had to face lot of problems to pioneer the concept of insurance among general public in the initial years. Most of the Bhutanese people were not aware of the benefit of monetary system not to speak of insurance. This situation prevailed for quite long years. Development of Insurance business goes hand in hand with overall economic development of a country signified in terms of its industrial progress. Insurance business of RICBL has been growing consistently but there still remains a huge gap between insured amount and insurable amount. Market analysis also indicated similar amount of market gap when the premium amount is worked out with reference to the value of the insurable assets. Hence, Mr. Ugyen Rinzin and Mr. Tshering Gyaltshen promoted Bhutan Insurance Ltd. with an initial paid up capital of Nu.100 million which will be raised to 200 million within 3 years. The two promoters hold 40% share and the balance 60% is issued to the public for subscription. The business transaction started on the 20th August 2009. While in insurance sectors Investment strategy shall be formulated for short term and long term. Short term strategy shall cover a period of first five years. Basically, investible resources shall be available from share Capital and Insurance Fund. For the initial years investment shall not be blocked for long term. Short term investment avenues like RMA bills/inter corporate deposit shall be utilized in order to ensure appropriate asset liability match in case of any

exigencies. This is absolutely essential for an insurance company particularly in the first five years. Long term investment strategy involves a time frame beyond five years. It is envisaged that the amount of share capital, retained earnings and appropriate proportion of insurance fund shall be scientifically invested in real estate in a phased manner. The Bhutan Insurance family shares a set of five core values: integrity, understanding, excellence, unity and responsibility. These values, which have been part of the Groups beliefs and convictions from its concepts days, continue to guide and drive the business decisions of Bhutan Insurance. The management and its staffs have been steadfast and distinctive in their adherence to business ethics and their commitment to corporate social responsibility.

The company has the following vision and mission. Vision To become the insurer of choice by providing quality service that exceed customer expectations and by constantly finding ways for improvement. Mission Their mission begins and ends with their clients for whom they exist to serve to the best of their ability. With dedicated services to their clients they aspire to contribute to the social and economic objectives of the nation, providing security to its growing assets through reliable insurance services and increasing retention of finance within the country.

SERVICES PROVIDED BY RICBL The insurance sector provides the following services.

a) Personal Accident Insurance (Individual & Group) b) Auto Insurance Policy (Private & Commercial) A) PERSONAL INSURANCE c) Money Insurance Policy d) Fire Insurance Policy a) Marine Cargo Policy B) COMMERCIAL INSURANCE b) Fidelity Guarantee Policy c) Aviation Policy a) Fire Policy b) Burglary Policy C) INDUSTRIAL INSURANCE c) Machinery Breakdown Policy d) Contractors Plant & Machinery Policy e) Construction Project Insurance D) LIABILITY INSURANCE a) Motor Vehicle Third Party

Research Objectives
The main reason for the study are mentioned below 1. To study what are the strategies followed by RICBL. i.e to find what strategies are followed by the Royal Insurance Cooperation of Bhutan in promotion of their business. 2. To study how affective is the promotion strategies followed by the co. 3. To study the promotion strategies followed by the co. that is distinct from other co. i.e to find how the promotion method is distinctive from other similar firm and how it is gaining competitive advantage over other firms. 4. To find the cost incurred in the promotion.

Literature Review
Rajni Kant Student ID No. PGPMI/N/01/039 Course Post Graduate Program in Management and Insurance Project Project Guide Prof. Gaurav Ashes has carried out the research on the promotion strategies use by the ICICI life insurance company in India i.e Advertisement. The findings and facts show that TAM Media Research, a joint venture between Nielsen Media Research (NMR)/ AC Nielsenand Kantar Media Research (KMR)/IMRB gives fruitful knowledge to understand media and advertising trend. In July 2002, TAM took operational control of ADEX service-the pioneer in Media monitoring in India. TAM inherited a well-oiled monitoring system with a trend work force. ADEX India represents a cutting edges strategy tool which helps us to keep an eye on advertising and media trend .Facts and figures of advertising trend of year 2007-08 and role of Life Insurance advertising in advertising business as per the survey conducted by AdEx India (A division of TAM) Snapshot on TV Advertising in 2007

They found out that 31 per cent growth in TV ad volumes during 2007 compared to 2006. Food & Beverages sector leads in TV advertising during 2007. HUL maintained its first rank in the top 10 advertisers list on TV across both the years 2006 and 2007. Snapshot on Life Insurance advertising on TV in 2007 They highlights that Life Insurance' players had an 80% share of overall TV advertising of 'Insurance' sector in 2007. 'Life Insurance' advertising grew by 72% during 2007 compared to 2006. 'LIC' took the top slot among the players of 'Life Insurance' on TV in 2007. Birla Sun life Childrens Dream was the top brand in the new brands list on TV. Snapshot on Life Insurance advertising in print in 2007 They highlight that in the Insurance sector, Life Insurance contributed 76% of advertising in Print during 2007. Life Insurance advertising dropped by 25% in Print during 2007 compared to 2006. High advertising in Life Insurance sector during the first quarter of both the years2006 and 2007. Private Insurers took 55% share of overall advertising of 'Life Insurance' in Print. LIC and Bajaj Allianz Life Insurance maintained their respective 1st and 2nd ranks in2006 and 2007. Baja Allianz Life Insurance and LIC were the top 2 brands of Life Insurance in Print during 2007. As per the survey conducted they found that there result majority of public use television for entertainment or information gathering, followed by newspaper and internet. Radio is seems to be out dated in urban areas. But after revolution in mobile technology and satellite radio it again starts growing. They also found that ICICI Insurance companies like to give their ads in News/Business channel. It may be because of Insurance is related to finance and Insurance is mainly taken as a tax saving instruments. They have emphasis that ICICI insurance company use advertisement as the mode of promoting their services. Whereas our research is to find out the promotion strategies use by the insurance company (RICBL) in Bhutan.

Alireza Miremadi- Assistant Marketing Professor & MBA Director at Sharif University of Technology, Ramak Raee- MBA Candidates from SUT-IC and Abbas Ramezani- MBA Candidates from SUT-IC have carried out the research on Exploring Innovative Promotional Strategies in

Life Insurance in Iran. They convey that almost all the insurance companies should rely on promotional strategies as essential and vital tools to provide competitive advantage in this competitive world, which leads to promotional strategies in life insurance companies in Iran. Here the researchers aim to probe into the reason of implementing right promotional strategies. Researchers discovered that the insurance companies take the benefit of AIDA model of communication, when they launch the product first time to grab more attention. Whereas our research is to .write objective of our research..

Research Methodology
4.2. Primary data collection 4.2.1. Questionnaires The questionnaire was given to some of the staffs of RICBL only and we had an interview with manager instead of questionnaire in order to gather detail information about the promotion strategy followed by RICBL. The questionnaire was distributed to the staffs to gather information to know their views on the promotion strategy and results of the questionnaire provided insight to the existence of the problems faced by the organization in promoting their business inclusive of the effort from the management and what could be the solutions to those problems. The questionnaires were combination of both closed ended and open ended.

4.2.2. Personal interview For the purpose of study, the group adopted this method to gather further data regarding the promotion strategy carried out by RICBL. Personal interview was adopted since it was more appropriate and the group wanted to get detailed information regarding the promotion strategy and it would be quite difficult to get the detail information about promotion strategy followed by the organization through questionnaires therefore the group used this method to remove the difficulties of getting the accurate and detail information.

Limitations of the study

1. We felt difficult to coordinate each other since no leader was appointed in our group. 2. No proper source to get detail information about the company. 3. Few questionnaires paper was vain, since there is no proper respond from the respondent. 4. Many questionnaire paper were misplaces by the respondent. 5. We hardly get chance to interact with the management because of their busy schedule. 6. Our group faced difficult in collecting detailed and necessary information about the organization since the company needs to maintain some secrecy.