Prepaid customers: Telenor launches life insurance scheme to widen user base

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SLAMABAD: 

In a bid to attract low-end mobile service users, Telenor Pakistan launched on Thursday life insurance for its prepaid customers, offering their heirs up to Rs100,000 in case of death amid increasing competition among industry players to expand their customer base.

Telenor, which according to the Pakistan Telecommunication Authority (PTA) is the second largest player after Mobilink, announced the Telenor Talkshawk Mohafiz Zindagi Beema for its prepaid customers consuming a minimum monthly balance of Rs200.

Telenor’s customer base at the end of May stood at 31.7 million, capturing one-fourth of total subscribers, according to the PTA.

The scheme has been launched in collaboration with Jubilee Life Insurance Company and MicroEnsurer Pakistan. It is the first such free life insurance policy launched by a telecom company to lure lower-end prepaid customers.

Prepaid customers can opt for the service without paying any fee and will be entitled to it as long as they are consuming monthly credit of Rs200, said Usman Javaid, Director Marketing of Telenor Pakistan.

In case of death, the policyholder will be entitled to a minimum insurance of Rs20,000 to a maximum of Rs100,000, depending on his monthly mobile usage, he added.

Post-paid customers have been excluded from the scheme, which has been launched with commercial objectives and is not part of Corporate Social Responsibility (CSR) activities.

Telecom companies are struggling to enhance their base, as the industry is reaching the saturation point due to absence of advanced third generation telecom services.

They are also facing the problem of dormant customers. On an average, every telecom customer is spending Rs210 to Rs215 per month on mobile services, which is considered low compared to international standards.

Telenor has linked the insurance facility with consumption of a minimum credit of Rs200 in a month. However, the Competition Commission of Pakistan Act 2010 bars enterprises from bundling their products and services.

Replying to a question, Javaid said Telenor has taken care of legal aspects of the policy and it is legally covered.

He said the service will be free of charge and is distinct from all other life insurance services on three accounts. In addition to having no premium, life insurance is without any exclusion policy and is paper-free.

However, the company has not covered post-paid customers in the insurance scheme.

Javaid said unlike Telenor life insurance, other life insurance facilities are not available in case of death due to bomb blasts or suicide attacks. But terrorists and extremists who die in sabotage activities will not be entitled to the life insurance.