National Economics University TABLE OF CONTENTS ABBREVIATIONS 1 LIST OF TABLES AND FIGURES 2 EXECUTIVE SUMMARY 3 CHAPTER 1 INTRODUCTION 5 1 Rationale 5 2 Research Objectives 6 3 Research Questions 6 4[.]
TABLE OF CONTENTS ABBREVIATIONS LIST OF TABLES AND FIGURES .2 EXECUTIVE SUMMARY CHAPTER 1:INTRODUCTION Rationale Research Objectives .6 Research Questions Research Scope .7 Research Methodology Structure of the thesis .9 CHAPTER 2:THEORETICAL BACKGROUND ON MAKETTING MIX FOR TRAVEL INSURANCE .10 2.1 Nature of insurance and travel insurance 10 2.1.1 Insurance 10 2.1.2 Travel Insurance 13 2.2 Marketing mix on travel insurance 14 2.2.1 Definition of marketing and marketing mix 14 2.2.2 Marketing mix on travel insurance 14 2.3 Factors impacting marketing mix for travel insurance product .23 2.3.1 External Factors .23 2.3.2 Internal Factors 25 CHAPTER 3: CURRENT SITUATION OF MARKETING MIX ACTIVITIES FOR TRAVEL INSURANCE PRODUCT AT LIBERTY INSURANCE LIMITED., 26 3.1 Overview of Liberty Insurance Limited and travel insurance product .26 3.1.1 Overview of Liberty Insurance Limited .27 3.1.2 Overview of Travel insurance product at Liberty Insurance Limited 33 3.2 Current situation of Marketing Mix Activities for Travel Insurance Product at Liberty Insurance Limited., 34 3.2.1 Product 34 3.2.2 Price 37 3.2.3 Promotion 41 3.2.4 Place 43 3.2.5 People 46 3.2.6 Process .50 3.2.7 Physical evidence 56 3.3 Achivements and shortcomings ….57 3.3.1 Achievements 57 3.3.2 Shortcomings 57 3.3.3 The causes of shortcomings .59 CHAPTER 4: SOLUTIONS TO IMPROVE MARKETING MIX ACTIVITIES FOR TRAVEL INSURANCE PRODUCT OF LIBERTY INSURANCE LIMITED., 60 4.1 Orientation of developing travel insurance product at Liberty Insurance Limited., to 2015 .60 4.2 Opportunities and threats to develop travel insurance product to 2015 .60 4.2.1 Opportunities .60 4.2.2 Threats 64 4.3 Recommendations to improve marketing mix for travel insurance product at Liberty Insurance Limited 65 4.3.1 Adjusting the limitation of current product and offering some new types .65 4.3.2 Applying suitable premium 66 4.3.3 Focusing on multiple distribution channels .66 4.3.4 Developing human resource capacity and competency .69 4.3.5 Improving process of issuing policy and claim service 70 4.3.6 Setting up proper promotion method 72 CONCLUSION 74 LIST OF REFERENCES 76 APPENDIX 77 APPENDIX 81 APPENDIX 83 APPENDIX 83 ABBREVIATIONS AAA AAA Assurance Corporation ACE ACE non-life insurance limited., (Vietnam) AIG American International Group., Inc Chartis Chartis Vietnam insurance company limited LIV Liberty Insurance Limited.,(Vietnam) Travelcare Travel insurance product of LIV WTO World trade Orgnisation LIST OF TABLES AND FIGURES Tables Table 3.1: Benefits of Liberty Travel insurance product 29 Table 3.2: Production of Liberty travelcare 33 Table 3.4: Travel insurance product of Liberty and others – Classic plan 35 Table 3.5: Premium of Liberty travelcare and others – classic plan .38 Table 3.6: Premium of Liberty travelcare and others – Executive plan 39 Table 3.7: Premium of Liberty travelcare and others – Premier plan .40 Table 3.8 : Travelcare’s Production through different channel 46 Figures Figure 1.1: Research process Figure 2.1 : Types of marketing in service industries 15 Figure 3.1: Distribution channel of travelcare product 44 Figure 3.2: The survey result about staff performance in Liberty’ travelcare service 49 Figure 3: Travelcare policy issuing process 50 Figure 3.4: Travelcare Claim procces 51 Figure 5: Survey result about process of Travelcare service .56 EXECUTIVE SUMMARY Liberty Insurance Limited., (Vietnam) - LIV is the new comer in Vietnam non life insurance market from November 2006 After one year the company receive the license from the Vietnam Government, they officially provide travel insurance product for people who travel overseas for tourism, business, studying, relative visits…etc LIV plans to become the most preferred non-life insurance company in Vietnam in terms of personal line The latest plan is to be in the top five largest non-life insurance company in 2015 Supporting this goal, LIV is trying to expand the business, diversify products and distribution channels Developing travel insurance product not only create good image of the great enterprise but also help the company diversify the types of product and increase the income However, more than years the result was not achieved as LIV’s expectation With the scope of this thesis, the author determined these following objectives: - Review travel insurance market in Vietnam - Give analysis and evaluation on current situation of marketing mix activities for travel insurance product at LIV - Find out achievements and shortcomings of marketing mix activities for travel insurance at LIV - Propose solutions to improve marketing mix on travel insurance product at LIV Based on the theory on marketing mix theory together with primary data (survey 100 customers, interview managers and partners & staffs and observation) and secondary (publications, reports, articles, etc.), the author has analyzed the each element of marketing mix (Product, price, promotion, place, people, process and physical evidence) for travel insurance product and compare it with competitors and customers’ expectation Current marketing mix on travel insurance product of LIV has made certain achievements such as: the office is modern and equiped, staffs include salestaffs, customer service staffs and claim staffs are very professional However, the marketing mix activities for travel insurance product of LIV still have some shortcomings: Some features of product is not suitable, price is so high, distribution channel is poor, human resource does not meet demand of growth rate, process is slow and rigid Based on the findings, the below is recommended for consideration of LIV: - Adjusting the limitation of current product and offering some new types - Applying suitable premium - Focusing on multiple distribution channels - Developing human resource capacity and competency - Setting up proper promotion method The author hopes that these recommendations will help LIV to increase its market share and increase profits from this product CHAPTER INTRODUCTION 1.1 Rationale Vietnam's insurance market, one of the fastest growing markets in the world, has expanded rapidly over the past few years And with support from the liberalization post WTO agreements, economic growth, rising incomes and increasing insurance awareness, the market will continue to grow at fast pace in coming years An open insurance market is an important criterion for membership of the WTO and Liberty is the first USA non-life insurance firm to gain the licenses after that Liberty Travel insurance is one kind of personal line product for all people who travel for tourism, visiting relatives, exhibitions, and so on Vietnamese living standard is better day by day and human needs are also higher and higher They not only want to fulfill with food & clothe but also require others such as buying luxury cars or traveling The increasing of traveler is opening wide market for travel insurance product Catching this trend, Liberty insurance Ltd., started to launch travel insurance product from the end of 2007 This is the strategy to diversify product line for the brand expanding of LIV Although the production is so small in comparison with other products, takes about 1.0% of total production in 2010, the board of directors wants to expand it for promoting brand name and product diversification to become the top five non life insurance company in 2015 Besides, this products brings more benefits than others because of lower loss ratio Travel insurance product is not new in Vietnamese market Liberty have to compete with giants such as Bao Viet, Bao Minh, Chartis, AAA, Gras savoye…who are leaders in this field In fact, marketing mix applied for the travel insurance in Liberty Insurance Ltd., is not effective in comparison with competitors In order to overcome difficulties and achieve business goals, the company needs to concentrate its resources and understand deeply a marketing mix for travel insurance I carry the research “Marketing Mix for Travel Insurance Product at Liberty Insurance Limited – Analysis and Recommendations” for all the above reasons 1.2 Research Objectives The main objectives of this research are to: - Review travel insurance market in Vietnam - Give an analysis and evaluation on current status of Marketing mix activities for travel insurance product at Liberty Insurance Ltd., - Find out achievements and shortcomings of Marketing mix activities for travel insurance product at Liberty Insurance Ltd., - Propose solutions to improve Marketing mix for travel insurance product of LIV 1.3 Research Questions The fundamental question guiding this study is: In term of marketing perspective, what are the factors that influence the overall success of the marketing activities on specific product The following questions are: - How does the travel insurance market develop in Vietnam? - What is the current status of marketing mix activities for travel insurance product at Liberty Insurance Ltd.,? - How to improve the marketing mix activities on travel insurance product at Liberty Insurance Limited? 1.4 Research Scope - Object: This thesis studies the marketing mix of 7P’s for insurance product, one type of personal line product - Time: The research will focus at analyzing and evaluating Liberty Insurance Limited from 2008 to 2010 and the development to 2015 - Place: The research will study at Hanoi and Hochiminh city – main reasons to expand travel insurance product 1.5 Research Methodology 1.5.1 Research Process Literature Review Secondary data In-dept Interview Survey Theoretical Framework Current situation of Marketing mix for travel insurance product at LIV Orientation of developing product of the Company Figure 1.1: Research process Recommendations to improve Marketing mix for travel insurance product at LIV ... mix for travel insurance product at LIV 1.6 Structure of the thesis Chapter 1: Introduction Chapter 2: Theoretical background on marketing mix for travel insurance Chapter 3: Current situation... 10 CHAPTER THEORETICAL BACKGROUND ON MAKETTING MIX FOR TRAVEL INSURANCE 2.1 Nature of insurance and travel insurance 2.1.1 Insurance People have to face with risks without preparation everyday... of marketing mix activities for Travel insurance at Liberty Insurance Limited., Chapter 4: Solutions to improve marketing mix activities for travel insurance product of Liberty Insurance Limited