The role of a life insurance agent

by Lorena M. Best (Insurance and Financial Advisor)

The insurance agent represents a trained group of professional persons operating within the financial services sector whose task it is to act as intermediary between an insurance company and its prospective clients. {{more}}
The first contact most people will have with an insurance company is through its agent or field underwriter as they are sometimes known. Within the industry, agents are more commonly referred to as “producers”. The Life Insurance Agent usually works exclusively for one insurance company and is thus considered as a captive agent.
Independent insurance agents or brokers represent several companies and place insurance policies for their clients with the company of their choice or with the company that perhaps offers the best rate and coverage.
The Life Insurance Sales Agent must first be licensed through the Supervisor of Insurance who regulates the Insurance Industry and must operate within the law prevailing in the country in which he or she operates. The agent must also take into account a code of account, which dictates a certain standard of behaviour. While every country has different legal requirements, ethics are the same throughout the world which comprises; integrity; objectivity; competence; fairness; confidentiality, professionalism and diligence. The agent must put the needs of his client above his own.
Traditionally, Life Insurance Agents primarily specialized in educating the policyholder to the benefit of providing for their beneficiaries, and to some extent some living benefit, namely, accidental benefits, personal accident and endowment policies were offered. As the market evolved, the agent responded to the needs of the individuals, families, and businesses selecting insurance policies that provide more protection for their lives, health, and financial well-being.
Life Insurance Agents promote mutual funds, market annuities that promise a retirement income, health insurance policies that cover the costs of medical care and loss of income due to illness or injury with other benefits such as dental and vision insurance, Long and short term-disability and critical illness benefits are also provided.
In recent times the client has become more concerned about wealth accumulation and investments and so the demand for interest sensitive financial products and financial planning have forced an increasing number of Insurance Sales Agents to be more knowledgeable. As a result, it is paramount for insurance agents to keep up to date on issues concerning their clients. Changes in tax laws and government benefits programmes, can affect the insurance needs of clients and the way in which agents conduct business.
Employers are also placing greater emphasis on continuing professional education as the diversity of financial products sold by its agents is on the increase. Agents are required to continuously pursue a course of study to be more equipped to offer comprehensive financial planning services to their clients, such as retirement planning, estate planning, or assistance in setting up pension plans for businesses.
Many entrants to the Insurance Industry, Sales Agent jobs transfer from other occupations. Technical experience in a particular field can help the agent to specialize in total needs selling to offer financial packages to those in the same profession.
Tertiary training may help agents grasp the technical aspects of insurance policies and the fundamentals and procedures of providing insurance services. Courses in finance, mathematics, accounting, economics, business law, marketing, and business administration enable Insurance Sales Agents to understand how social and economic conditions relate to the insurance industry. Courses in psychology, sociology, and public speaking can prove useful in improving marketing techniques. In addition, because computers provide instantaneous information on a wide variety of financial products and greatly improve agents’ efficiency, familiarity with computers and popular software packages has become very important.
Technology has greatly affected the insurance agency, making it much more efficient and giving the agent the ability to take on more clients. Agents’ computers are now linked directly to their insurance companies via the Intranet, making the tasks of obtaining price quotes and processing applications thus improving the delivery of service.
There is upward mobility within the Insurance Company, for an Insurance Sales Agent who shows ability and leadership may become a sales manager heading his own agency in a local office. A few advance to agency superintendent or executive positions. However, many who have built up a good clientele prefer to remain in fieldwork. Once considered a male-dominated industry, women have broken the barriers and are top producers within this sector. A few even head their own brokerage firms.
The role then, of the insurance agent is considered vital to the life of the insurance company. Insurance Sales Agents should be flexible, enthusiastic, confident, disciplined, hard working, and willing to solve problems. They should communicate effectively and inspire customer confidence. Because they usually work without supervision, sales agents must be able to plan their time well and have the initiative to locate new clients.
In summary, the agent is the professional liaison between the Insurance Company and client and is responsible for developing and maintaining a strong relationship that does not stop at delivery of the policy but is life-long. The role of an agent is not merely to ‘sell a policy’ but rather to provide a crucial
service that is fundamentally beneficial to the client’s financial well-being and prosperity to future generations.
Consequently today’s Life Insurance Agent has earned the right to be recognised as Professional Financial Advisors.