Financial planning is a lifelong process and a long-term client relationship is essential to help financial planners understand clients' needs in the different stages of their life. Because of this, the unique business nature of insurance companies provides financial planners a comparative advantage in offering services.
Jones Lam, assistant vice president and head of financial planner division, agency administration department at American International Assurance Company (Bermuda) Limited (AIA), predicts insurance companies will eventually take the lead in providing the largest number of financial planners in Hong Kong.
Mr Lam says that in 1995 when the financial planning market was in its infancy, AIA was the pioneer in Hong Kong to recruit financial planners. Since then the number of financial planners at the company has grown substantially. For example, in 2000 only about 10 per cent of the company's new recruits were financial planners; today, however, more than half the company's annual intake is financial planners, representing the company's ambitious efforts to lead the financial planning market.
AIA currently has 8,500 representatives in Hong Kong, 3,500 of which are financial planners. The strong force is still expanding and the company aims to recruit more financial planners, targeting university degree holders and those who have relevant professional qualifications.
According to Mr Lam, in the past some newly recruited financial planners had misconceptions about the job nature and thus found it difficult to adjust. To increase awareness among prospective recruits and attract the best talent to financial planning, AIA has improved its conventional recruitment strategies by providing more university internships and discovery programmes. Participation in these helps to familiarise possible candidates with the job duties and to develop them through hands-on and practical financial planning techniques.
Mr Lam believes the redefined recruitment strategies will help newly recruited financial planners adapt to their new work conditions and enhance their confidence in serving clients. "We have several cases where people who have participated in our internship programmes have gone on to join us when they graduate and become successful financial planners," he says.
To further cultivate interest in financial planning, AIA organises financial planning competitions for university students and scholarships for its interns.
As well as focusing on university students, Mr Lam says that the company will continue to value recommendations from existing agency members and other industry practitioners. "Unlike banks or independent financial advisors (IFAs), we take a proactive role and aggressive approach in recruiting financial planners. Therefore, we mobilise our 1,000 unit managers to help strengthen our workforce," he adds.
Mr Lam believes the long-term client relationships that are formed by insurance companies and their positions in the market make them competitive and capable of managing clients' assets and offering them objective advice," he says. "Financial planners in large-scaled insurance companies like AIA can provide better services to clients with their broader range of products and service support."
Financial planning is an integration of different financial management services in which product development and professional skills always keep changing. As such, AIA encourages its financial planners to undertake different kinds of training and obtain professional designations to enhance their professionalism.
The focus on training changes gradually with reference to their experience and the target they hope to achieve in their career. For example, from the first to third years of service, training for financial planners mostly focuses on selling techniques and interpersonal skills. From the fourth to the sixth year, training is designed to sharpen management and supervisory skills, and from the seventh to the 10th, training focus is on cultivating leadership and entrepreneurial skills. Mr Lam says this structure provides a clear path to reach the management level at the company. "Looking at the long term, we help every one of our financial planners to develop their own team, and to expand their client list and business scope," he remarks.