Year 2011 - Bancassurance – my perspective 銀行保險 我知我見

not capable or not willing to do so. Others diversified their business to include corporate insurances; to avoid direct competition with these institutions and by doing so would be able to maintain the individual insurance portfolio because they have greater access to people working in these corporations. After all, insurance is sold not bought, only if one has a chance to sell the product, one will be able to close a business. If one’s client already has a good product with a reasonable price, the chances for the client to move away to another insurance agency will be reduced. As for insurance brokers who advise the clients on their risk exposures, arrange programs suitable for the clients and then seek to find an insurance company willing to underwrite such risks at a reasonable price, it seems that competition from any insurance agencies including banks is not that great as each work on a different business module. However, if insurance brokers were not discharging their duties as brokers should and continue to sell product, they will lose out to insurance agencies, as their clients would not see the value of using insurance brokers. Insurance brokers traditionally do not compete head on with insurance agencies, as they tend to concentrate on corporate clients. They usually take on individual clients only because the individuals work for the corporate clients. Some tried to pick up individual clients through workplace marketing, no one knows how successful they were. Intermediaries who could not find solution to the competition and are thinking about selling their portfolio to banks, should ask themselves why the banks would be willing to buy their portfolio? If the clients are not clients of the banks, banks could hardly be in touch with these clients and they do not have the capabilities to service these clients. The value of the portfolio would be diminished. It might be better to sell the portfolio to other insurance agencies. In my view, although there are widening channels of distribution for insurance products, various insurance intermediaries have positioned themselves in different market segments. As long as the intermediary has a defined market position, established its own strategies to find a competitive edge for itself, it should be doing well even against a bigger, more financially strong competitor. Important things are to continue to improve the services it provides be it to the principals it represents, the end user it is selling the product to or the clients it represents; continue to improve its staff’s product knowledge; and conduct its business within the business ethics as required it should have nothing to fear! Lawrence Lee Mr. Lawrence Lee is now working as a Management Consultant He retired as CEO of Aon Hong Kong, one of the leading insurance broking companies in Hong Kong a few years ago after serving the insurance industry for more than 30 years. His past services in the Insurance Industry include being: Insurance Lecturer in the Hong Kong Polytechnic, now known as The Hong Kong Polytechnic University; President of Hong Kong Insurance Institute; Member of Hong Kong Insurance Training Board; INED of a public listed Insurance Company. Mr. Lee holds B. Sc and MBA degrees. He is an ACII and also a FLMI. 17