Ethical Issues in Insurance Marketing The Case of Western India

This is a paper based on empirical investigation conducted in Western India between 2002 and 2012 especially at a time when the Indian economy is in a stage of transition from state capitalism to free market capitalism, albeit both of a retarded variety. It takes the 7 Ps of services marketing and cross verifies responses against seven dimensions of ethical conduct. The study is based on questionnaires followed by interviews. The target respondents were life insurance employees of bank assurance involved in marketing life insurance policies to customers in the urban sector. The study brought to the fore the fact that commissions were more important that telling the truth while selling policies. In the process ethical considerations conveniently went out of the window. To protect the interest of the unsuspecting clients a plea is made to have governance machinery in place that will make the insurance marketing personnel accountable for what and how they sell their wares. This need is especially felt in a country where the social security net is virtually non-existent and the erstwhile joint family system is on a fast decline. In such circumstances a lack of ethical norms on the part of the insurer is an unacceptable sociological proposition and borders on gross unethical behaviour. The task of people management experts to address this issue is of the paramount importance and urgency if the Indian life insurance industry is to sustain its social image in a highly competitive market where foreign players are steadily entering the domestic scene.