Business Practice of Insurance Company - Another View

VIEW POSTED IN MY BOG

Business models usually evolved and got copied from one company to another. I would like to offer my view to mr. tan's observations:

1. From some friends of mine in a sales department of a networking equipment company, a pharmaceutical company, a software company, they told me that it is very common to have attractive prizes such as overseas trips and motivational activities as incentives, aside from high commission and bonuses that they get from selling the products.

2. With regards to "projections" - isn't projections are what they are meant to be - projections? if anyone tell you that projections are "guaranteed", then better inform MAS immediately. No, better still, if you can tell me which company can guaranteed 100% something in 20 years time, I will invest in it myself.

3. Most people in the sales line will meet objections and rejections. This happens in any industry. Unless you are naturally thick-skinned, you have to learn how to manage them or else how are you going to give your solutions to people. In particular to the insurance industry, where many people do not plan for their own future or unexpected demise, you got to learn how to overcome objections in order to help them help themselves.

4. I think every product serves a need. it is not fair to compare a product of yesterday with a new product today. A good fund yesterday may be a lousy fund today even though same performance. Why? because our expectations have risen. I know some MNCs who practice this model of eliminating staff whose performance levels falls below 5% relative to the performance of his/her peers. That means, every year sure must lay off some people. When a person buys a product, it was intended to serve a purpose and as long as the original purpose is achieved, it is should be ok. That's why people must know that buying insurance is not a one time thing. he/she must always buy new one whenever there are new needs to be addressed.

5. It is better for the company to make profits than to make losses. The questions should be - are the profits channeled back as more bonus for clients, training of advisors and creating more value-added solutions to consumers? Let's not be hypocritical - if you are buying equities or bonds, don't you want the companies that are linked to them to be profitable and sustainable companies?

Come on, if I buy a product from Income, I also want the company to be profitable and have money to improve the quality of the advisors and come up with innovative products.

There are two sides of a coin and it's not always fair to say that this company or product or agent is bad or good without considering the context where the event took place. By the way, since MAS is the regulatory body, if such practices are not condoned, how come never shut them down?