Dear Sir,
What is the fair remuneration for an adviser to sell a life insurance policy?
REPLY
1. It should be based on the time spent
2. It should be comparable to other occupations.
3. To sell a policy, a fair remuneration should earn $100.
At present, the advisers earn about one year or more of the savings. If you take a policy for $200 a month, the adviser earns about $2,400. His manager earns an overriding commission. There are other cost.
The total cost to the customer could add up to $4,800. This is the total amount taken away from the customer's savings. It is excessive. The customer should not be have to pay such a heavy cost, just to get a life insurance policy!
For an adviser to make a living on $100 per policy, it is necessary for the customer to visit the adviser in his office, just like you visit a doctor in his clinic. I hope that, in the future, insurance policies will be sold in this cost effective manner.
Mr.tan, i hope you will contribute to the fair dealing consultation paper about your views; about commission being the worse means of remuneration; insurance agents malpractices; their poor knowledge and skill; product selling to be replaced by advisory; disclosure; prominent disclosure of customers' right and the complaint bodies; address and telephone numbers of Fidrec and CASE;and the insurers' unethical manufacturing of products that fleece the customers and using the agents to abet in their quest for market share.
ReplyDeleteRemuneration for agents should be based on both fee and commission.
ReplyDelete#1. Fee for advice only -- to be agreed; client provided with prescription or recommendation of the products.
#2. product selling---50% to 70% discounted from product commission
#3. Advice and execution----full commission less some fee--to be agreed.
Even remuneration based on above may be abused but documentation will give away any malpractice and it can be self incriminating. This is the safeguard.
Zhumeng:o)
Hope the Fair Trade ACT will be actively enforced to catch errant insurance salesmen. Consumers must also cooperate as whistle blower to rid the industry of bad hats. If consumers want to have fair dealing
ReplyDeletethey must be careful in choosing their advisers. It is not easy when almost 85% of the insurance agents are salesmen and not qualified.But nevertheless due diligence must be conducted. Ask around for referrals or consult Financial Planning Association of Singapore.
In US, people visit the CFP practitioner's office for any kind of financial concerns. The practitioner charges fee on an hourly basis. Normally, the first hour is free. It is preliminary and it is to determine the areas of concern and to set the scope of service to be provided.
ReplyDeleteIn US fee can range from US$100 to US$200 hourly; a piecemeal rate or a percentage of value involved.
Financial planning is a profession like law, medical etc.In 2006 it was the most sought after profession.
Slash the agents commission if they sell products only by 60%. To earn this back they have to show that they add value to the customers.
ReplyDeleteThe 40% is for filling the forms for th customers;to read the product story to the clients; to make claim; to give service like providing info; to pay for their time and transport to see the client;and sometimes to babysit clients' baby.
The 60% is for giving advice and to be responsible for the recommendations and to see that the clients' needs are met and to monitor and review for the clients.
Hey
ReplyDeleteWhy don't all of you become agents for a while and see how you survive. Lets see wh all yr bright ideas will work! Agents don't work for free, they also need to survive!