Agents are being prepared for training camps – Newspaper Kommersant No. 169 (7370) dated 09/14/2022

Against the backdrop of active growth in sales of accumulative life insurance (CLL) policies, specialized companies plan to expand the staff of agents. This segment of the market still has low penetration, and insurers estimate the potential highly. Some companies plan to hire new employees, while others plan to retrain existing ones. At the same time, experts note that marginality in the segment may decrease due to overly optimistic estimates of growth, weak work of agents and an increase in unscheduled payments.

According to a Kommersant survey, companies operating in the life insurance segment plan to significantly increase the number of agents. In 2021, according to the Central Bank, almost 18 thousand agents worked in the life insurance market.

Capital Life Life Insurance (more than 7.5 thousand agents) plans to increase its share to 50% by the end of 2022. Ingosstrakh-Life (1.7 thousand agents) is going to actively increase its agent network, including by expanding its regional presence. In “Consent-Vita” and “Rosgosstrakh Zhizn” they want to increase the number of agents by involving those already hired from other segments. Sovcombank Life (about 600 agents) intends to employ 4,000 agents in two years. The company notes that life insurance is becoming increasingly popular, but which requires clarification and a flexible approach to the client, a trusting relationship, which is possible “only with personal communication through a financial consultant.”

According to the ARIA, in the first half of 2022, only accumulative insurance showed growth in the entire life insurance market, premiums for which increased by 73%, to 117.7 billion rubles. Credit life insurance premiums for borrowers decreased by 28% to RUB 45 billion. Premiums on investment life insurance (LIC) almost halved, to RUB 51.7 billion.

Experts believe that the agency channel is the most effective in life insurance. Moreover, in the current situation, the main focus of the company is on the life insurance. Such programs still have low penetration in the Russian market, which means that the potential is huge, they explain in Renaissance Life. This makes it possible for the company to build long-term relationships with clients and agents, since the classic life insurance programs are issued for a period of 5 to 35 years, notes Vladimir Chernikov, General Director of Ingosstrakh-Life. The agent sales channel looks like the most convenient and effective way to promote life insurance policies, especially long-term ones, adds Olga Lyubarskaya, senior director for ratings of insurance and investment companies at Expert RA.

Independent expert Andrei Barkhota adds that two sales models compete in the market: partnership with a limited pool of partners with elements of exclusivity and agent sales in selected regions, where their work is regulated by a flexible motivation system. SuperJob notes that the motivation system may include, among other things, commissions from each contract, annual bonuses based on the results of the plan, corporate training (in-person and online). Mr. Barhota adds that, on average, an insurance agent works with three to five companies – with baboutIt is difficult to work with a large number of companies, because it is difficult to build a sales funnel. And if the agent does not fulfill the monthly standard, the insurer may refuse to cooperate with him.

In general, according to the forecast of Expert RA, by the end of 2022, the life insurance market will collect 4–6% less premiums than in the previous year. And although this segment will partially recover in the second half of the year against the backdrop of a recovery in consumer and mortgage lending, it will not be able to reach the levels of 2021. At the same time, the drop in the collection of premiums for life insurance is partially offset by the active promotion of life insurance policies, the agency notes. “In the second half of 2022, relative to the same period last year, in terms of sales volumes, life insurance can grow by 10–15% and life insurance by 0.5%,” Mr. Barkhota estimates.

However, experts warn that in life insurance, including life insurance, marginality may fall. It may decrease if one or more factors occur, Andrei Barkhota explains: failure to achieve the target level of sales, worse work of agents, an increase in acquisition costs and unplanned growth in payments – in this case, insurers will try to offset the drop in margins by changing the balances of insurance programs and agents’ motivations.

Julia Poslavskaya