Prudential Singapore Events Sponsorship

Prudential Singapore Events Sponsorship

a) Overview of Prudential Assurance Company Singapore

Prudential Singapore is an indirect wholly-owned subsidiary of UK-based Prudential PLC. They are one of Singapore's top life insurance companies in Singapore. It started out as an agent for fire insurance in 1924 before it attained full branch status and began operations as Prudential Assurance Company Singapore in 1931 where they have since been providing the financial and protection needs of Singaporeans since 1931

(Saparudin, 2018)

 

Prudential focuses on bringing well-rounded financial solutions to customers through their multi-channel distribution network which includes both its agency and bancassurance channels. These distribution channels are also a main driver of its success with its agency force being one of the largest in Singapore while its bancassurance channel remains a significant contributor to the company’s business and is poised for further success with the extension of its partnership with Standard Chartered for another 15 years.("Prudential Singapore Delivers Another Record-Breaking Performance For 2013", 2018)

Prudential Assurance Singapore is currently operating in the insurance and financial services and products industry in Singapore and has a wide range of product offerings in, Medical, Protection, Savings and Investment for both retail and institutional customers

The financial services industry plays a vital intermediary role in the world economy as it moves money from entities with excess funds to those with a need for funds (KOLAKOWSKI, 2018). Firms that are in this industry engages in activities such as investing, insurance and lending. Its clients are individuals, businesses, non-profit organizations, and agencies of government. Some of the businesses are services that are in this sector includes banks, insurance companies, financial planning/management, Securities brokerage, financial advisory services, etc.

E.g. Bank deposits provide the capital for bank loans. The sale of stocks and bonds to investors supports the operations of businesses and governments who issue those stocks and bonds. Insurance contracts help to pool and manage risks. (KOLAKOWSKI, 2018)

Prudential Singapore is the first life insurer in Singapore to be named Asia's Life Insurance Company of the Year in 2000 ("Prudential Financial", 2018)

Some examples of plans (products/services) offered by Prudential includes

Medical Plans such as PRUextra, PRUextra Lite and PRUshield covers the buyers’ and loved one’s medical needs by providing coverage for medical and hospitalization bills.

Protection plans such as PRUlife multiplier flex, PRUTerm Vantage, PRUpersonal accident and PRUearly stage crisis cover. These protection plans are designed to cover the buyers’ and loved ones against life’s uncertainty. The plans offer coverage for death, disability, terminal Illness and critical illness, accidents, food poisoning, animal and insect bites.

All claims handling will also be done by the company for you.

b)Target Market

Generally, the target customers of Prudential Assurance Singapore are the fast-growing middle class in the Asia region ("Prudential PLC Full Year 2017 Results", 2018) between the ages of 18 years old to over 65 years old who are “prudent”. This includes groups like working adults, families, retirees. They have different insurance plans that targets the different markets based on their “groups”. These insurance plans usually cater to people that are in different phases of life that requires different coverage.

There are also different life stage trigger events that happens for the people in the different age range of the target market that causes a need for a different insurance coverage. Some of the life stage trigger events to consider are marital status at different ages (Single/Married), whether the person have children, or if they are retirees. These different life stage trigger events would usually result in a different combination or need for the type of insurance coverage. For example, young parents who have children would be more concerned with their children’s future, health or even their homes they would be more interested in the insurance coverage of areas regarding protection and savings as compared to a young single. These young singles who typically fall into the age range of 18-24 years old would need to start work and they are more likely to seek coverage for investments and savings.

Prudential Assurance Company Singapore also targets the local business as well as international businesses. Prudential Singapore offers plans for various types of coverages such as employee benefit solutions where it will protect a company’s employees from the financial impact of unforeseen illness and accidents ("Employee Benefit Solutions", 2018). There are also plans that protect business assets and its owner. Some of these financial plans include, Keyman insurance (protection of crucial people in an organisation), Asset Management (manages assets, investments, reserves), Retirement and Succession Planning. ("Growing Your Wealth in The Lion City", 2018)

c)Competitors

Some of the competitors of Prudential Assurance Company Singapore are AIA Singapore, AXA Insurance Singapore, NTUC Income, Great Eastern Life Insurance. (Caproasia, 2018)

These competitors are insurance companies based in Singapore that targets the same target audience as Prudential Singapore. Majority of the insurance policies that are offered by these companies provide the same areas of coverage for individuals and companies. Some of the common insurance policies that are found in all these companies are Life, Medical, Savings, Investment, Accident and Employee Benefit protection.

Strengths:

1. Over 4600 financial consultants and strong regional bancassurance alliance with United Overseas Bank (UOB) as well as Standard Chartered creates a strong distribution capabilities and brand recognition ("Prudential Region Site", 2018)

2. One of the largest life insurers in Singapore making ours the largest tied agency force in Singapore.

we are the only life insurer in Singapore to have been awarded an AA Financial Strength Rating by leading credit rating agency Standard & Poor’s.

3. Strong market share in Singapore “Singapore is the second-largest market for Prudential in Asia, based on annual premium equivalent sales.” (The Edge Singapore, 2018)

4. Technology investments in Prudential Singapore has also help to increase their efficiency and productivity “At Prudential, new digital capabilities worth S$70 million have been built up over the past year.” “It's to arm our employees with better technology, automate laborious work procedures and bring in efficiency.” ("S$70m and counting: Prudential to reinvent itself with tech investments in Singapore", 2018)

Weakness:

1. Human resource management. 

Prudential Singapore faces a problem that every insurance company faces. Poaching employees from a rival company is a norm for insurance companies as it is believed to be the “fastest and most effective way to hire experienced agents without having to spend money and many hours training them” (TAN, 2018)

Poaching an employee from a company affects both companies as these agents are important channels of distribution for the company’s product. As one company gains more agents and distribution power, the other not only loses their agents but potentially their customers as well. In the end, Insurers may also increase premiums or reduce cash values to recoup the costs related to such poaching activities - and consumers will get the short end of the stick.” (TAN, 2018)

 “The Singapore company is accusing Mr Tan, 53, of getting more than 230 agents and agency leaders to move to rival insurer Aviva Financial Advisers.” ("Prudential sues former manager for poaching agents", 2018) Incidents like this shows that there is poor human resource management in the company to not notice early signs of poaching activities, not managing employee-company relationship well or even adopting a poor hiring procedure that hires job hoppers (employee loyalty would not be present)

2. Increase Costs

With many competitors in this industry that offers similar products, price is the only factor that remains highly competitive between these companies. Prudential Singapore faces a problem with increase costs as the claims for treatments in private hospital remain a thorny issue for the insurer (Huang, 2018) as seeking treatment in private hospital are more expensive compared to government run hospitals.

“Prudential made the first move to raise its private hospital rider premiums by 5 to 35 per cent across all age bands.”

With many alternatives that consumers can purchase their insurance from, an increase in the price of the insurance may deter some customers from purchasing their insurance from Prudential Singapore. Instead, these customers may switch to other insurance companies that have yet to increase their premiums (i.e.. Great Eastern Company, NTUC income).

Opportunity:

1. Cyber Insurance

With the number of cyber-attacks on businesses and organizations increasing around the world, there is now a market for businesses to seek coverage “against the expense of being hacked or losing sensitive customer information.” Just in the United States of America alone, “One in three companies now has insurance to specifically protect against such losses. Last year, cyber insurance policies sold to retailers, hospitals, banks, and other businesses jumped 20 percent,” (Fernandes, 2018)

This serves as a business opportunity for Prudential Singapore to explore as only a handful of companies such as AIG Singapore offers Cyber insurance for companies in Singapore and the Asia Region

 

2. Aging Population

As the aging population in Singapore and Asia region worsens, it is common to see this aging demographic as a financial burden. However, the aging population in Asia serves as an opportunity for Prudential Singapore and Insurance companies in the region. “Firstly, Life insurance has a central role to play in mitigating the effects of Asia’s rapidly ageing society and tailor-made regulations are needed to maximise the industry’s positive function,” (Abbas, 2018) as healthcare cost is expected to increase around the world, insurance targeted towards the aging population would be in higher demand and serves as an opportunity for Prudential Singapore to be able to sell more insurance. Secondly, “retirees today also tend to hold quite significant spending power in some parts of Asia due to accumulated savings.” (Abbas, 2018). Insurance products could be designed to target more senior citizens as they increasingly become a strong purchasing constituent. One example could be travel insurance targeted at elderly travellers, who are increasingly going on holidays

Threats:

1. Fierce Competition

With many known and established in Singapore, Prudential faces steep competition from various insurance companies in Singapore. It is very difficult for Prudential Singapore to maintain their current customer base whilst trying to attract more customers at the same time as “In an increasingly competitive market, insurance companies in Singapore are being forced to dream up more elaborate ways to get customers' attention.” ("Singapore Insurance companies do battle!", 2018). These elaborate marketing efforts offers huge incentives for customers to buy insurance from them. An example of a company that adopts an “extreme marketing effort” is Budget Direct Insurance. Budget Direct Insurance gives away redeemable cash cards to nearly 500,000 motorists if they register their details with them. They also running a promotion of “Pay less or get $100” where if “motorists find that their own car insurance renewal quote is cheaper than a quote from Budget Direct Insurance for the same level of cover, they'll get $100*.” ("Singapore Insurance companies do battle!", 2018)

With these types of competition from other insurance companies it would be hard for Prudential to keep their customers as well as attract new customers due to the price incentives offered by other insurance companies.

2. Cyber Security

With cyber security being a market opportunity for which Prudential could develop on, cyber security also poses as a threat to Prudential Singapore and other insurance companies. Insurance companies, much like the legal, healthcare, and financial sectors deal with a great deal of personal and often sensitive client information. The insurance sector has lagged far behind other financial-sector industries in its adoption of cyber security technologies. ("Cyber Security Risks Facing Insurance Companies in 2017", 2018) This makes insurance companies extremely vulnerable to cyber-attacks. An example of such cyber-attack on an insurance company is AXA Singapore. In 2017, The personal data of 5,400 customers of AXA Insurance in Singapore has been stolen due to a cyber-attack. Information such as the customers’ e-mail address, mobile number and date of birth were exposed. (THAM, 2018) These cyber-attacks not only reflect badly on the insurance company but also exposed the infrastructure vulnerabilities of the company.

 

d) Past & Current Sponsorship involvements

1.      Prudential Healthy Life Expo 2016

The Prudential Healthy Life Expo had a line-up of health talks, fitness classes, games and free medical checks and was designed to encourage Singaporeans to get healthy and fit in a fun manner with families and friends. More than 50,000 people, including our employees, financial consultants and customers visited the Expo, which spanned over three days in December 2016. ("Sponsorships", 2018)

2.     Standard Chartered Marathon Singapore

Prudential Singapore was an Official Sponsor for the Standard Chartered Marathon Singapore (SCMS) from 2012 to 2016. Through this initiative, the Company endeavors to support Singaporeans’ growing interest in marathons and to help cultivate a greater sporting culture in Singapore. The Company’s efforts to promote a healthy and active lifestyle were reinforced by an annual participation of about 150 Prudential staff in each marathon. ("Sponsorships", 2018)

The objective of sponsoring these “sport and health” related events are in lined with their new efforts of encouraging preventive healthcare instead of excessive medical claims. Prudential Singapore offers “win-win” policies that provides incentives such as discounted premiums or vouchers when customers achieve health goals while insurers benefit from a healthier pool of policyholders, which means they can continue to offer insurance at affordable rates. (TAN, 2018) An example of a policy that encourages preventive healthcare is the PRUextra Premier policy. It is a fairer pricing approach for policyholders which rewards and encourages healthy living. Premiums are determined by the claims the customers make at private and public hospitals. Customers are eligible for a 20% discount on their premiums if they do not make any medical claims in a specified time. ("PRUextra Premier", 2018)

   

  3. Singapore Fintech Festival

Singapore Fintech Festival is the largest festival of its kind in the world, bringing together more than 25,000 participants from financial institutions, technology companies and fintech start-ups from over 100 countries to showcase their digital solutions.  Prudential is a Grand Sponsor in the 2017 edition of SFF and a mentor to fintechs participating in the Global Fintech Hackcelerator. The company introduced several new digital solutions benefiting customers, businesses and start-ups at the festival. The sponsorship agreement demonstrates Prudential’s dedication to fostering a culture of innovation, collaboration and co-creation among the participants. ("Prudential pledges support to nurturing innovation with five-year sponsorship of the Singapore Fintech Festival", 2018)

The objective of Prudential Singapore committing themselves to this 5-year sponsorship is to show their connectivity to the business sector and community. Not only does this festival help in exchanging of information between Prudential and the festival participants, it also helps Prudential in adopting new technologies that will meet the customer’s demands of “greater speed, seamlessness, convenience and control over their finances” by “creating a distinctive Prudential customer experience across multiple touch-points. It is also creating digital tools to help its 4,500 financial consultants work more efficiently and serve customers better.”

This festival also serves as a platform for Prudential Singapore to develop their brand image for future partnerships with financial institutions, technology companies and fintech start-ups from all over the world as well as establishing themselves as having leading edge technological capabilities to serve its customers.

4.     Prudential Carnival

Singapore’s largest carnival with over 40 family-friendly, thrilling rides and games. This carnival ran from 15^th of December 2017 to the 1^st of April 2018. Over 1.4 million visited the carnival that featured 22 rides and attractions and 29 game booths. (TEE, 2018)

By sponsoring this event, Prudential Singapore provides an opportunity for families and friends to have fun and spend more quality time with each other while staying active.

Name recall is also a factor that Prudential Singapore wishes to achieve given the lack of tangible products and the general public’s low understanding of the industry’s intricacies ("Prudential to sponsor Singapore’s Marina Bay Carnival", 2018)

 

e) Sponsorship recommendation and Justification

An event that Prudential Singapore could potentially sponsor is “Run for Hope”

Run for Hope (RFH) is an annual run organised by Four Seasons Hotel Singapore, Regent Singapore and the National Cancer Centre Singapore (NCCS) to raise much-needed awareness and support for cancer research.

The Four Seasons Hotel Singapore and Regent Singapore, has been supporting local cancer research through an annual run, since 1993, making this the single largest run in aid of cancer research here. Since 2008, they have been partnering the National Cancer Centre Singapore (NCCS) to raise awareness and support for critical, life-saving research by dedicated scientists at the Centre. ("Run for Hope Singapore | What is Run for Hope?", 2018)

Why should Prudential Singapore support this event?

I think that Prudential Singapore should sponsor this event as this event not only helps to raise awareness and money for a cause, it also encourages a healthy lifestyle for Singaporeans. It would also be good for prudential to support a non-profit event as it shows genuine care for all the people in the community. There would also be an improvement in brand recognition as people would often remember and support companies that are associated with a good cause. Thus, leading to an increase in business opportunities for Prudential as well.

“91% of global consumers are likely to switch brands to one associated with a good cause, given comparable price and quality*

61% of consumers are willing to try a new brand, or one they’ve never heard of, because of its association with a cause*

50% of global consumers said they would be willing to reward companies that give back to society by paying more for their goods and services (44% in the U.S. and 38% in Canada).”

(Horrigan, 2018)

Run for Hope is also remains “its tradition as a non-competitive leisure run. So, everyone; anyone; young & old, can join in the worthy cause & fun.” ("Run For Hope Singapore | What is Run For Hope?", 2018). This is also a good platform for a sponsorship as the people that takes part in this event are those that falls into the same target market of some of Prudential’s policies

References

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Prudential pledges support to nurturing innovation with five-year sponsorship of the Singapore Fintech Festival. (2018). Retrieved from https://www.prudential.com.sg/en/our-company/press/2017/20171116/

TEE, C. (2018). 1.4 million people visited the Prudential Carnival which ended its run on April 1. Retrieved from https://www.straitstimes.com/singapore/courts-crime/14-million-people-visited-the-prudential-carnival-which-ended-its-run-on

Prudential to sponsor Singapore’s Marina Bay Carnival. (2018). Retrieved from https://www.insurancebusinessmag.com/asia/news/regional-news/prudential-to-sponsor-singapores-marina-bay-carnival-85895.aspx

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