The slowdown in the economy, SEBI and IRDA never ending and ever changing regulations, falling margins, better opportunities elsewhere….are all reasons why the agents seem to be consolidating.

Many wealth oriented people are hoping that the clients will understand the need for Medical and Life cover insurance. Typically my suggestion is for people to buy Term insurance online. However many people (sadly including readers of this blog) go online – and the company sends over a rep. This rep is then able to convince them to buy a ULIP – and surprise, surprise fall for it!

There are agents who did not find the whole business lucrative, so they just dropped out. Then there are others who find selling mutual funds and E-brokerage accounts more remunerative, so they have dropped out. Many girls have dropped out because marriage has made them relocate. Many men have dropped out because they have changed jobs and are unable to find time to do this business – effort reward ratio has gone against them.

I know of some top agents (who would have been in the top 30 in any company from the years 2001 to 2008) who have completely dropped out of the radar. The ratio of Bank sales : Agent sales is now far far heavily favoring the banks – something like 70% even for non bank promoted life insurance companies (read Reliance, Max N Y Life, MetLife, Birla..). Even though technically Hdfc Life Insurance is promoted by Hdfc (and not by the bank) Hdfc bank is a very good sales channel and is responsible for a dominant share of the business done by the life insurance arm of the Hdfc group.

Of course there are agents who are benefitting by the dropping out of agents – those who are in the business and continue to be there will surely benefit.

Do I know agents? Well I know a few ’00s if not a few ‘000s. Many of them have the clients good at heart, but I do not know of any agent who can really think of what is good for the client ONLY. That is not only tough, but also impossible to expect. Nor am I finding the end buyers taking the trouble to do enough research and know what to buy.

Dilemma…if your agent has disappeared…do not worry there is somebody who is consolidating, but he may not be as servile – he knows he is in a small club of skilful, valued agents! Good for him for sure…..


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  1. Hello Subra, Was wondering about Your statement “Typically my suggestion is for people to buy Term insurance online.” Having followed your blog for long, i know you have advocated term insurance (and i concur and have one too), but dont recollect you recommending online term plans very strongly…given that market leader hasnt yet come up with an online term plan (though there is one in the pipeline), would you suggest going with the 2nd rung like ICICI, Aegeon, Kotak’s online term plans?

  2. Subra,

    I have a term plan from HDFC that I bought couple of years back thru’ an agent. However HDFC has introduced online term plan for same coverage with premier that is 30%-40% less. Does it make sense to discontinue the old offline plan and buy the new online plan?

    My health has not deteriorated in the last two years (I think so. My last medical checkup didn’t show any substantial deviation). What would be your suggestion?

  3. Sankar,

    FIRST take a new one – if you are a non smoker try Kotak, Religare…or any other company YOU TRUST…AFTER YOU TAKE A NEW one, discontinue the old one…

  4. Hello Subra Sir,

    I have read ur book, Retire rich Invest and have become ur big fan after reading the approach needed towards retirement. Under insurance section, i just want to ask one question, i want to buy an insurance policy for my dad, age: 54, which policy would you suggest, Term Plan or an endownment plan ? Also which plan would best suit my needs ? Thanks !!!

  5. Hi this is venkatesh, I have ULIP plan with maxnewyork. and going to complete second year. And I want to switch the policy from maxnewyork to LIC Jeevan Saral. Can any one suggest me that how to switch from one policy to another policy.

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