|
When I
was still in life-insurance sales (in an agency), which
seems to be eons ago, I felt that there was a great need
to start evolving our practice.
In fact,
I gave several talks on the topic in several agencies
from different companies aside from the company I used
to represent. I remember saying that if we don’t move
away from the way we do our business from “pushing”
products to providing solutions, we may, one day, find
ourselves “obsolete,” so to speak.
It is a
known fact that many life- insurance agents are very
“pushy” in the manner of selling their products.
Shedding the negative image of the typical
life-insurance agent was a particular challenge for me
when I was starting. The ’90s would seem to be the
golden years for the life-insurance agents as we
experienced much growth (at least for the company I
represented), but toward the late ’90s I felt that it
was time to change the way we practice our profession.
Many of
the insurance companies were not part of the solution
but may have been part of the problem—many stuck to very
“traditional” approaches of merely emphasizing the sale
of products and nothing more. Issues of
misrepresentation, influence-selling and the like were
proliferating and was adding to the negative impressions
of life-insurance agents.
I
believe that the industry went through some great
changes in the ’80s with the establishment of the Life
Underwriters Association of the Philippines (LUAP)—it
paved the way in drastically improving the image of the
insurance agents, which ushered in the “golden era” of
the ’90s.
However,
as the new century came, the professional agent went
through a lot of challenges—policy yields, dividends,
commissions started to drop while the competitive
environment became more unforgiving.
The need
and value of life insurance did not change. Now, more
than ever, people should have the benefit of financial
protection only a life-insurance policy can give. It is
important to note that having a life-insurance coverage
is the beginning of the financial-planning process, and
as our population yearns to achieve financial stability,
it should be reflected in the increasing number of
people buying life insurance.
However,
it is perceived that the growth in the number of insured
individuals is not even catching up with the growth of
the population. The number of professional agents should
be even growing with the supposed increase in demand.
But it isn’t.
I feel
that there is a great need for change, pretty much when
many concerned parties advocated needed changes in the
’80s—and this change should be initiated by the
professional agents themselves, just like in the ’80s.
Don’t get me wrong. There have been milestones already.
I see more financial planners (in deed, not just in
name) now. We just need more, way more.
Let’s
look at hard facts. Total premiums are still growing,
but where did the growth come from? Two major reasons
contributed to growth—variable (unit-linked) life and
bancassurance. The current bull run in the Philippines
made the new product very encouraging. Double-digit
growth rates would really attract a lot of people.
I dare
say that the No. 1 selling strategy of many
practitioners is anchored on the performance of the
investment-linked funds. Bancassurance allowed banks to
start selling insurances in their own branches. Believe
me when I say that selling in the banks is way “easier,”
but that’s another topic.
Hmmm,
how much is bancassurance’s market share lately? A lot,
as in a lot! The sad part is, although there is growth
in total premiums, it really is still a drop in the
bucket. The increase in absolute premiums was not driven
by the increase in the number of new family heads being
insured but rather by the two reasons I mentioned
earlier.
My
question is, what happens now as we enter a bearish
environment—wiping all those gains or, at the very
least, tempering growth rates? Remember the times when
some pooled funds were giving -30 percent? That wasn’t
too long ago. What if bancassurance completely dominates
the environment? What, then, is the future of the
professional life-insurance agent?
My
answer? Create VALUE! The professional life-insurance
agent would be of great value to the insurance company
and the clients because he can provide better service
and better advice if he is genuinely true to his
profession.
The
professional agent should make himself very valuable;
upgrading his skills and moving away from the very
traditional ways of selling as they are now turning off
clients. Where “soft” skills were enough to make a sale
before, hard or analytical skills are just as important
nowadays. This is important if the life-insurance agent
is to survive the onslaught of many changes.
The
professional agents should lead in these changes. They
should not wait for their insurance companies to do it
for them. Bring “professionalism” to a different level,
an evolution in the truest form.
Upgrading of skills should be foremost in every
life-insurance agent’s priority list. Technical
knowledge should be on a par with good selling skills.
I’ve met many who experienced success in their sales
when they started evolving—we just need to see more,
more, more of them.
Our
professional organizations should also be in the
forefront of changes—their conventions are still the
same—mostly about “soft skills”—and it’s as if
motivation is the only thing that is important.
I went
to one of the conventions late last year to check if the
“quality” of the conventions changed. My goodness, it is
still the same—same speakers, same topics, same format.
Well,
these are just my thoughts. I’ve spent many years in the
frontline for me to write this article. I strongly
believe in the professional life-insurance practitioner.
I strongly believe in life insurance. I hope that what I
wrote here will plant the seeds to openly discuss these
concerns. We need to start talking about it and doing
something about it, again and again.
Maybe it
is time for me to once again go back into life-insurance
sales so I can practice what I preach. Hmmm, not a bad
idea.
To
buyers of life-insurance policies, be very particular
when you choose your agent—look for someone who is very
competent and someone who will really take care of your
needs for a long time, a true professional. Doing so
will help force my friends in this industry to evolve
faster.
****
J.
Randell Tiongson is a training specialist,
personal-finance educator and coach and a director of
the Registered Financial Planning Institute. He has been
engaged in the various facets of the Financial Services
Industry for nearly two decades. He is also the
cofounder of
www.income-tacts.com with Efren Ll. Cruz, an
interactive site dedicated to the financial literacy of
every Pinoy. For inquiries, you may send an e-mail to
randellt@gmail.com.
Watch
out for RFP Forum & Income-Tacts Live, soon! |
