COVID-19: Bank of Maharashtra Sees 'Business Opportunity' in Pandemic; Wants Employees To Hustle Insurance

Moneylife Digital Team 18 March 2020

Economy & Nation

A circular issued by Bank of Maharashtra (BoM) asking all its branches to consider the corona virus (COVID-19) pandemic as a 'business opportunity' and sell more insurance policies has shocked even its own rank and file. TMG Mahabaleshwarkar, general manager for resource planning, alternative banking channels (ABC) and operations has issued the circular on 17 March 2020.

Given the rampant mis-selling of insurance by all banks, there is a serious worry that they are cashing in on panic to sell insurance, which may or many not help defray hospitalisation costs in the current pandemic. That a formal circular has been issued by a public sector bank, raises questions about whether the regulator will ensure that hapless depositors are not preyed on at this time when most countries are coming forward to offer free medicare.

BoM’s circular says, "Performance of the bank under the ABC campaign is nowhere near the expectations in both life insurance campaign and non-life insurance campaign, which is very disappointing...Looking at the risk of pandemic 'COVID-19' awareness and demand of health insurance have increased. This is the time to use this as business opportunity and help our customers by offering suitable health insurance products."

This circular has evoked angry reactions from bank employees.

According to Devidas Tuljapurkar, general secretary for All India Bank of Maharashtra Employees Federation that is affiliated with AIBEA, issuance of this circular at this hour of crisis when the entire nation is struggling with medical emergency is inhuman, cruel and, hence, deplorable.

"Bank staff is somehow attending the branches and office with great risk. At the time asking them to canvass for this product is unimaginative and asking customers to purchase this product is cruel. This is unbecoming of public sector management. Alluring staff by offering incentives and linking it with their performance is further crueller," he says.

The Federation has demanded immediate withdrawal of the circular which, it says, is resulting in lowering the image of BoM inviting reputational risk.

The circular issued by BoM also gives a target of Rs3 lakh to all zones for four days between 18th March to 21 March 2020. "On achieving this target, successful zone will be recognised as 'pro-health zone' with trophy by insurance company.

"Performance report shall be appraised to top management separately," the circular issued by Mr Mahabaleshwarkar says.

BoM Withdraws the Circular
Facing backlash over social media after publication of this news report, the Bank says it had withdrawn the circular about selling insurance to customers. In an email, Satish Kumar, chief manager for media relations at BoM, says, "We deeply apologize for the wordings of the said circular but our intentions were to serve our customers and their family member in the fight against COVID-19, as it is now covered under health insurance policies. The said circular has been withdrawn by the Bank."

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