Tan Kin Lian's Blog: Jobs in Life Insurance industry

Saturday, October 17, 2009

Jobs in Life Insurance industry

Mr. Tan,
You have recommended people to buy Term insurance. If everyone takes your advice, will there be enough jobs for the people working in the life insurance industry?

REPLY
Yes. There will be enough jobs - as many as there are now working in the industry. They will be providing a better quality of service to customers in financial planning and insurance. I shall talk about this matter in a separate article.

11 comments:

zhummmeng said...: We don't need 15000 insurance agents only 5000 qualified ones enough.Currently as many as 90% of them are NOT qualified to advise on personal finance or even insurance.
The industry should not be seen as an industry to provide jobs for drop outs, retrenched, the sacked secretaries or receptionist or people who can't get a job or worse people who think that this is a get rich quick job. For this the insurance companies are to be blamed.In the recruitment talk or business promotion talk they use high earning and commission to entice or to lull people into becoming insurance agents.
It is no longer based on passion or calling or professionalism but how much money potential one can earn in the industry .
It is doomed from the start. The culture is imbued from the start.
What hope have the consumers when these people coming on into the 'profession' with a mindset like this, to make as much money OUT of their cleints and not how they can add value to their clients.Is it a wonder there are so many complaints against them?
MAS should control the number of agents just like they control the doctors and the lawyers by regulation so that the best of the crop, the qualified, the competent and honest ones will have a decent profession.; October 17, 2009 7:47 PM
Anonymous said...: While zhummmeng has a point, we can also extend that same argument to taxi drivers.

Let's face facts. Property agents, insurance agents and taxi drivers are the jobs of last resort for our economy.

If we restricted entry into these professions, our unemployment rate will rise.

And our economic statistics may even start to reflect reality.; October 17, 2009 8:56 PM
Anonymous said...: MAS should ..... Don't you know MAS cannot Micromanage FIs or products. In time of crisis, the most they can do is conduct a investigation, ban the product and announce in parliment that this is enough to Tarnish the reputation of the FIs while FIs continue to bully their ex-customers by not admitting to mis-selling and later compensate them a bit so that the ex-customers will not join the class action groups.; October 17, 2009 10:04 PM
wjsim said...: By limiting the insurance agency force, you'll soon see consultation fees equal to that of lawyers and doctors.

It's give and take. Honestly, I would rather NUS lift the limit for lawyers and doctors. Currently, we have more academically qualified candidates than places for these 2 professions, more so for doctors. And now, we have very good doctors and lawyers at a very high price. They are able to demand higher pay because there are just aren't any who would do it for less or free.

Choose your poison.

You sound as though all lawyers and doctors are "competent and honest"... I doubt limiting the number will solve anything. It will just create a monopoly for those "competent and honest" agents. Because the insurers will just kick those earning little (those selling Term and kacang commission products) off the list and there's no way you can stop them. Honesty and competency cannot be judged quantitatively.

I would like to chip in on the topic. There MAY be less jobs in life insurance industry. But the good news is, the purchasing power diverted from buying crappy products will be put into more productive use either by personal consumption, savings or investment in capital. These additional resources will create more employment and possibly more productive employment in other industries.; October 18, 2009 12:02 AM
Don Lim said...: To be fair, I think every major kind of products in existence today has a place. We must understand that when we talk about buy term, invest the rest, we are talking about the insiders who understand what risk management is. But the majority aren't experts. And, it's not easy to convince many that it's the wisest thing to do. Most people think in terms of cost (expenses) and profits (returns). Hence, by packaging term in traditional products, it is more acceptable to these people. Now, it's not a matter of whether everyone SHOULD buy term and invest the rest. The fact IS most are not finance-savvy enough to understand the concept of Risk Management. They think of, as I said, Cost-Benefits. When their frame of mind is like this, it's better to sell them something rather than to leave them with nothing. If you try to sell them too hard term products to the extent they reject you, then they may not buy even a traditional product, which means they are naked. So, in advocating term, we must do it gradually. An important factor is the maturity in financial know-how of local consumers. The process must be gradual. Just as when HDB flats were first introduced, many Singaporeans were unwilling to give up their wooden houses. Meanwhile, we should focus on providing choices. With more choices, consumers of different levels of knowledge are able to select products based on what they want. Many customers are happy with a reasonably high cover and relatively higher returns with lock-in features than bank deposits. Insurance companies' traditional products are still a better investment than bank deposits. So, those who buy traditional products have made an improvement over depositing money in bank.; October 18, 2009 4:38 AM
zhummmeng said...: No wonder we are under insured and are low in score in the pension index.
The above says something to this effect "so long it is better than the bank" it is the correct product and justifiable to recommend.
Put in another way, "so long we lose for you lesser than the bank" it is justifiable. This has been the argument of insurance agents and consumers are hoodwinked into buying wholelife and endowment by this logic.
The agents also lie or give the impression that BTITD is a strategy which the consumers are left to do on the own.
Of course not. The objectives of BTITD are to ensure you have adeqaute insurance and that your investment is given the BEST chance of returning the highest and that you can accumulate for your goals.
With traditional wholelife and endowment? No way, unless you are very rich. But the rich is not our concern. It is the poor man in the street and ordinary folks that BTITD works best for them.

The insurance agents are opposed to BTITD because of commission. They will get much lesser from BTITD than from wholelife and endowment. The planners who prefer BTITD put the interest of the client first as opposed to insurance agents who prefer WL and endwoment and who put their own interest first.
The often used argument that there is a place for every product. I agree but the products are ALWAYS deliberately sold to the wrong people .
EG: WL or endwoment is suitable for the rich who don't need coverage nor care about saving or accumulating for their retirement because they are already rich.
The poor need high coverage and to make their hard earned money work very hard instead they are 'recommended' the opposite like the WL and endowment.Worse, anticipated endwoment , the most despicable cashback product is dumped on them.What got chance to retire and how mcuh is the coverage?
The truth is agents have conflict of interest, incompetent and dishonest.; October 18, 2009 2:41 PM
Anonymous said...: Ya, the agents always compare to the bank rates. The banks are already losing to inflation why compare to them to losing rates? Is it agents trying to compare that their products are losing lesser than the banks? It is still losing , right? Who is the agents trying to bullshit? There may be suckers who would fall for this false argument.
No wonder a lot of people never got to retire with this kind of 'advice' from agents.
I don't think the insurance agents care about their clients' financial life. They care only to make the sale for themselves.
I have grown to distrust the agents. No choice but to read up myself and DIY. I may not become an expert but it is better than entrusting your money to this bunch of thieves in sheep's clothing.; October 18, 2009 7:16 PM
Khiat Han Hwee Adrian said...: I agree that not all insurance agents are honest but we cannot disagree that there are good and honest agents around.

Agents should not be always be put as the scape-goat for the products that the insurance companies designed and tell them to sell.
Why are agents always being cursed and hated upon here?

Perhaps the government have to step in to start an insurance account in our CPF or start a National Scheme to force everyone buy insurance and force everyone to invest.; October 19, 2009 12:50 AM
Anonymous said...: Agents are cursed for short changing and stealth stealing from their clients who don't know because they trust these them.
If CPF were to start such schemes agents should be barred like the CPFLIFE.
Where do you think their money is from, those people who qualify for mdrt and cot.You mean all their clients need wholelife and endwoment to protect their family and save for retiremnt?
Adrain, you should know by now that these products fall very far short of meeting the consumers' financial needs.They are inefficient and ineffective but these agents have no qualms dumping on them.; October 19, 2009 12:52 PM
Anonymous said...: Dear Adrian,

Why are agents always being cursed and hated upon here?

Why, you ask? Cause the vast majority of agents are not being honest and tend to deceive the public by selling them what maximises their own income. The vast majority of agents don't sell for consumer needs.

Please reflect on your own thinking/motives and your own action. How would you feel if other people deceive you and sell you a house that you don't need but is actually only a want that cost a 100K more?; October 19, 2009 12:53 PM
Insurance License Classes said...: The reason why i think it is still advisable to join the industry is because there will always be a dearth of good insurance agents. Those who are trusted and sought after by consumers when consumers talk to their family and friends about how they got their needs fulfilled and whether they are satisfied or not. That pretty much sums it all up for me.; November 06, 2009 5:28 PM