A life assurance salesman is that man (or woman) who sells life insurance products to people. He is given different titles but his duty is primarily to sell life insurance products.
Traditionally, a life assurance salesman is called an “agent” and that is truly who he is as he acts on behalf of his master. But that title, “agent”, is gradually being replaced by some other fancy names such as “Financial Adviser,” “Financial Planner,” “Financial Representative” etc. Part of the reasons for this is that insurance salesmanship has continued to expand beyond the simple sale of life products. A life assurance salesman of today is expected to act professionally and offer the best advice to his client.
Irrespective of the name he’s called, a life assurance salesman has some basic responsibilities which are crucial not only for his personal success, but for the growth of the insurance industry as a whole. Those four responsibilities are what I intend to address in this article.
a. Responsibility to himself as a life assurance salesman
A life assurance salesman must always bear in mind that insurance business is a business of promise, so integrity matters a lot. Our business is that of uberrima fides (utmost good faith) so a life assurance salesman must act with honesty at all times.
Selling life insurance products requires a lot of perseverance. It can be so tasking to convince prospects to buy life insurance so an agent must be a determined person. He must be proud of what he does, have confidence in himself, and display a high knowledge of his products.
Talking about product knowledge, a life insurance agent must realize that canvassing for business or making presentations to prospects actually comprises 5% knowledge of his products and 95% knowledge of the people. It therefore behooves him to take great interest in people. He must also know that he needs the entire 100% of that 5% product knowledge. In other words, his product knowledge must be total; otherwise he would not be able to give appropriate advice to clients.
Self discipline plays a dominant role in the life of every successful life assurance salesman. As stated by Brian Tracy, self discipline involves “doing what you should do, when you should do it, whether you feel like it or not.” Is it an early morning appointment? A life assurance salesman must make it. Must he sacrifice his pleasure time to enable him meet a production target? He must have the heart to do so.
A life assurance salesman owes himself the duty of continuous self development. He must acquaint himself with developments in his industry, other sectors of the financial industry, his environment, and the world at large – all these will give him the needed confidence and enthusiasm to go about his business.
b. Responsibility towards his industry
In those days, people used to judge our industry by the mode of dressing and behaviors of our salesmen. Unfortunately, the judgment was always negative as the general public perceived us as hungry people who wore dirty shirts, unpolished shoes, wrinkled jackets, and color-riot ties. They also viewed us as unscrupulous people who could disappear with their money at any time!
Those were the pictures the public had of our industry and most of them originated from the industry’s salesmen. A life assurance salesman is the face of the insurance industry. He’s the first contact with the prospect and, as they say, first impression matters a lot. The image of the insurance industry is the image presented by its agents.
While the mode of dressing for life insurance salesmen have improved tremendously over the years with many now competing with bankers in terms of dressing, same cannot be readily said for the unethical practices that are still around. Though we continue to witness better behaviors by the day, three key malpractices have over time become quite common in the industry. These are:
- Rebating – This is the unwholesome practice of offering financial inducements to clients with a view to securing business. This industry monster, as in other industries in Nigeria, has acquired many names such as egunje, family support, subsidy, etc and it is more applicable to corporate agents (brokers) than individual agents in our industry. It is sheer bribery and must be avoided like a plague by all life insurance salesmen.
- Switching – This is another unprofessional practice in which a salesman, for his own selfish interest, asks a policyholder to change from another company to his; or where he out rightly discredits competitors in order to make a sale. It is similar to what the bankers call “de-marketing.” Not only is “switching” bad for the insurance industry as a whole, it is also not in the best interest of the policyholder who will most likely lose money or some advantages due to movement of his policy to another company.
- Misrepresentation – This occurs when a salesman “oversells” his product by claiming that such a product offers more than it actually does. It is a dishonest practice usually aimed at influencing the prospect to buy. The practice is quite common in the area of product description and bonus projections for a policy.
A life assurance salesman must know that he owes the industry the responsibility to act in an ethical manner and abide by the codes of practice of the profession.
c. Responsibility to his company
A life assurance salesman must respect the practice and procedure of his company irrespective of his previous experience or knowledge. He must play by the rules of the life office that he represents; most especially underwriting rules, and claims procedure.
By disrespecting his company’s rules, a life assurance salesman is indirectly killing that company. He must disclose material facts that are known to him and strive towards bringing quality businesses into the company. Producing quality businesses ensures that there is good persistency (i.e low lapse ratio), satisfactory mortality, and low acquisition/policy maintenance costs for the company.
At every point in time, a life assurance salesman must be conscious that it is his responsibility to (i) respect his company’s rules and (ii) be fair to existing policyholders.
d. Responsibility to his clients
Finally, a life assurance salesman has a responsibility towards his clients. When people buy life insurance products, they are actually putting their trusts in that salesman. He therefore owes them the responsibility to be truthful, fair, and helpful; knowing full well that “life insurance is sold and not bought.” He must not be a “hit and run” salesman who abandons his client and disappears into thin air after collecting his commission. He must continuously provide his client with quality service right from the point of sale to the time of claim.
Section 54 of the Nigerian Insurance Act 2003 states, among others, that,“An insurance agent who assists an applicant to complete an application or proposal form for insurance shall be deemed to have done so as the agent of the applicant.” Every insurance salesman must bear this in mind and act with integrity.
Since my joining the insurance industry some years ago, it has always been a common ritual for industry players to discuss the issue of professionalism at every forum. If all life insurance salesmen, be it individual or corporate, could champion the four responsibilities enumerated in this article, it would not take long before the age-long issue of “unethical practices” would disappear from our industry’s dictionary.