Mumbai: At a time when the financial markets are hit by crisis and uncertainty, insurers are hawking safety and stability in a slew of brand-building initiatives and reassuring ad messages.

In safe hands: For a long time, the January-March period accounted for up to 80% of ad spending, but these cycles are now changing.

Insurance product advertisers are seizing the moment, given that the fundamental propositions of this category—safety, security and stability—can be leveraged in a financial meltdown, say experts.

Government-owned Life Insurance Corp. of India Ltd, or LIC, for example, launched an ad campaign in September highlighting these qualities. “LIC has assets worth more than Rs8 lakh crore... your money is in the safest hands possible," said one ad. Another said, “LIC settled 139 lakh claims last year... we not only make promises but keep them too".

For private sector insurer Tata AIG Life Insurance Co. Ltd, the need to reassure customers following the buyout of the 79.9% stake in the American International Group Inc. by the US Federal Reserve in September prompted it to put out ads that went on to reassure customers that they were not likely to be affected by this development—and that the Tata group was a majority stakeholder (74%) in Tata AIG.

“What we see is understandable," says Santosh Desai, managing director and chief executive officer of Future Brands, a brand consultancy of the Future Group that owns Pantaloon Retail (India) Ltd. “There is a fundamental fear that is capable of causing a high degree of panic… so, while reality is robust, reassurance has to be provided."

Industry experts maintain that consumers tend to lean towards relatively risk-free investments or organizations that are backed by the government at a time of financial insecurity. The same sentiment is also likely to drive the desire for risk cover.

“We were lucky that the campaign was still running… the message (on depth and financial strength of the brand) is extremely relevant at a time when people are looking at secure options to put their money in," says Sangeetha Narasimhan, president-west, for RK Swamy BBDO, the advertising agency handling LIC’s account. “Everyone (insurance agencies) will tap into this sentiment." Some firms are also hoping to grow their business at the competition’s expense. Iffco Tokio General Insurance Co. Ltd, for one, has launched a new ad campaign titled Albert Pinto kyon muskura raha hain (Why is Albert Pinto smiling), featuring Bollywood actor Paresh Rawal as Albert Pinto, in a take-off from the movie Albert Pinto Ko Gussa Kyon Aata Hai (What makes Albert Pinto angry).

The company is pleased, says a company official, as their new campaign launches at a time when the financial stability of their competitor (read Tata AIG) is in question.

“This is the best time for us, why should we let such an opportunity go?" asks N.K. Kedia, director, marketing, Iffco Tokio, adding that the theme for their campaign—Muskurate Raho (Keep smiling) is important, especially “in present day life, which is full of risks and tension". The campaign will be followed up with a few product launches.

Traditional strategies and media spending cycles are changing in the insurance sector to tap the opportunity at hand. Chandradeep Mitra, president of Mudra MAX, the Mumbai-based media specialist of the Mudra Group, explains that insurance in India has historically been seen as a tax-saving instrument. While the government offered tax sops to encourage people to buy insurance, the downside has been that people invest only enough to obtain the tax benefit.

So, for a long time, the entire cycle—in terms of advertising, marketing, promotions or otherwise—has been skewed towards the January-March period that accounts for up to 80% of ad spending in this sector, he says.

While new private insurers have tried to buck this trend, with emotional hooks of securing a family’s future, they also realize that selling insurance purely on these factors may not be enough. So they have also started advertising tax-related instruments and unit-linked investment options, says Mitra. The insurance sector has a lot to gain at the cost of others, such as mutual funds and other market-linked investment options, and is not likely to be affected by any economic downturn, he adds.

As a result, ad expenditure forecasts are rosy for this sector, unlike many others. In the financial year that ended in March, this sector spent about Rs400 crore on advertising, says Mitra. Some of the top spenders were LIC, HDFC Standard Life Insurance Co. Ltd, Reliance Life Insurance Co. Ltd and ICICI Prudential Life Insurance Co. Ltd.

This year, ad expenditure is likely to grow, say experts. As of August, the sector had already spent an approximate Rs138 crore on advertising. This is double the amount spent last year (Rs63 crore) during the same period.

Some of this is driven by the entry of new firms, such as Aegon Religare Life Insurance Co. Ltd, Sahara India Life Insurance Co. Ltd and Canara HSBC Oriental Bank of Commerce Life Insurance Co. Ltd. Also, an existing company, Max New York Life Insurance Co. Ltd, upped its ad budget this year as a key sponsor for the Indian Premier League, Mitra points out.

Experts say that even if there is some conservatism in advertising expenditures by insurers that are part of companies affected by the financial crisis, or due to exposure to other affected markets, this is not likely to impact overall growth in ad budgets.

It’s proven marketing wisdom, they say, that long-term brand building cannot be neglected for short-term tactics to push sales. Aware of this, players such as HDFC Standard are using creative routes to build their brand.

It recently launched a music album titled Sar Utha Ke Jiyo (Live with your head held high) to promote its brand message of self-respect and self-reliance. The album is being promoted through a music video on all major television channels. The strategy is to promote the brand, rather than focus on popular triggers, such as return-related campaigns or as tax-saving instruments.

“Companies should focus on need-based solutions and long-term?brand building campaigns rather than short-term tactical campaigns, like those for tax planning, showcasing products with high returns in a short term, etc., as there is a good chance that such brands may lose customer trust during the market downturn,"says Sanjay Tripathy, executive vice-president and head, marketing, HDFC Standard Life.