While job opportunities for insurance agents are readily available, seven in 10 of those joining the industry gradually opt out after finding themselves unsuited to the profession. However, top insurance agent achievers can make millions of dollars annually, according to Jeff Wong, president of the General Agents and Managers Association (GAMA) of Hong Kong.
Unlimited recruitment drives are advertised almost daily, but Mr Wong says the market is still not saturated, pointing out the trade's huge turnover. "An agent normally takes six months to find out whether he is fit for the job, but the real challenge often comes in one or two years, when he has to solicit new clients after selling policies to former classmates, friends and neighbours," he notes.
With about five million policies being enacted in a population of 6.81 million, Mr Wong sees the insurance business as viable, with ample growth potential. In Japan, he explains, insurance policies are 600 percent over-subscribed compared to the size of its population; in Taiwan and Singapore, meanwhile, over-subscription is at more than 100 percent. "If we believe Hong Kong is to follow the economic trend of developed countries, our insurance policies should reach every family and individual," he stresses.
Business has also been picking up after a drop during the SARS outbreak, notes Mr Wong, who adds that a demand for medical and hospital insurance is apparent. Although 299 people died of the disease, only about 72 life insurance claims have been made by their families - indicating that many victims did not have life insurance coverage. In addition, he notes that new businesses, generated for long-term polices, rose to double digits after 1997, as more people lost faith in investing in the dwindling property market.
Nonetheless, the profession is facing an unprecedented challenge in the current economic downturn, plus keen competition from other professionals - mostly bankers, accountants, lawyers and investment agents - registered as technical representatives to sell insurance polices. GAMA figures show that, up to June this year, there were 29,101 individual insurance agents, down 1.71 percent compared to the same period last year; 1,968 responsible officers (agents representing various insurance firms), down 11.83 percent; and 16,302 technical representatives, up 12.17 percent.
Helping clients to set up their financial plans
"In the past, banks used to do more on credit and mortgages but with interest rate and property prices nose-diving to a record low, they have focused more on selling insurance, which is more profitable," he comments. "People can approach any bank for the service."
In order to survive, Mr Wong advises insurance agents to sell policies more professionally, set up good relationships and build up mutual trust with clients. They should also upgrade themselves by acquiring relevant insurance knowledge, such as ordinances related to taxation, the Mandatory Provident Fund and estate duty. "We are no longer just selling protection, but helping clients to set up their financial plans."
With this in mind, the 1,000-strong GAMA, set up in 1994, aims to provide internationally- recognised educational programmes to improve the standard of insurance managers. However, Mr Wong believes that the current government regulatory system adequately monitors insurance agents' practices. Last year, he notes, only nine out of 253 insurance cases closed were ruled in favour of the complainant by the Complaints Panel and the Bureau Secretary.
Currently a branch manager for The Prudential Assurance, Mr Wong joined the industry in 1991 after graduating from the Chinese University of Hong Kong and his outstanding performance has earned him a string of awards. However, he does not deny that many university graduates shun the profession because it still suffers from a low image. "Many graduates want to join large corporations to gain experience," he says. "They don't see good prospects in sales jobs. They query if they are capable of doing them and are worried about whether their friends can afford the premiums."
He also notes that not every man on the street can be an insurance agent. In his opinion, a successful candidate must possess good interpersonal and communication skills, be determined and exude self confidence. But, if he or she spends some time in the industry, it will be a rewarding career, in terms of both monetary and job satisfaction, he adds.
One of Mr Wong's tasks as a branch manager is to encourage his 40-strong team to survive in the industry. To achieve this, he says he has to make them change their belief that they are taking money from clients; instead, they are providing a service, like a doctor offering treatment for payment.
He also has to build up trust among colleagues and help them break through production targets to qualify as managers. "You need not be a champion. If you have reached the sales benchmark, your company will recognise your success and reward you," he explains.