The Top 3 Life Insurance Companies: Fewer Agents but Increased Contract Numbers

One Insurance Agent Sells More Than 3 Policies Per Month

Intense Competition to Secure High-Performing Agents

Calls for Support Measures for Agents Amid COVID-19 Crisis

[Asia Economy Reporter Oh Hyung-gil] Agents affiliated with the three major life insurance companies sold an average of more than three new insurance policies per month last year.

Despite the insurance market shrinking due to low growth and market saturation, the productivity of exclusive agents at insurance companies has continuously increased. With frequent turnover of agents following the emergence of corporate insurance agencies (GA), competition to secure agents with differentiated sales skills is expected to intensify further.

According to the insurance industry on the 28th, while the number of exclusive agents at major life insurers such as Samsung, Hanwha, and Kyobo Life has been decreasing annually, the number of new contracts has been increasing.

Last year, Samsung Life's exclusive agent count was 24,105, down 297 from 24,402 the previous year. The number of Samsung Life agents, which reached 25,495 in 2017, decreased by 1,390 over two years.

However, the number of new contracts through agents actually increased. From 752,855 in 2017 to 895,005 the following year, and 977,290 last year, showing significant growth.

The number of new contracts per agent also jumped from 29 in 2017 to 40 last year. This means an average of 3.3 contracts per month. Although the number of agents decreased, the sharp increase in new contracts caused this phenomenon.

Hanwha Life recorded 17,808 exclusive agents last year.

Although this was a slight increase from 17,676 the previous year, it was a decrease of 1,257 compared to 19,065 in 2017. However, the number of new contracts, which was around 640,000 in 2017, increased by 28% to about 820,000 last year. The number of new contracts per agent also continued to rise from 32 in 2017 to 36 in 2018, and 46 last year.

Kyobo Life also saw an increase in new contracts per agent from 28 in 2017 to 34 last year.

Although new contracts decreased by 1.6% from 495,125 to 487,013, productivity improved as the number of agents dropped by 3,058 (17.6%) from 17,307 to 14,249.

Life insurers, which mainly sell whole life insurance, heavily rely on face-to-face sales through agents. Insurance companies are strengthening support for agents by providing mobile application forms and sales guides using tablet PCs, and offering additional incentives based on performance to manage turnover.

Accordingly, the agent retention rate (13th edition), which indicates the proportion of agents who have worked at the same company for more than one year after joining, is also on the rise. According to the Financial Statistics Information System, the average agent retention rate among 21 life insurers was 34% last year, up 11 percentage points from 23% five years ago in 2014.

However, since face-to-face sales have virtually stopped due to the COVID-19 pandemic, there are calls for support measures for agents who have experienced income reductions.

In Japan, major life insurers such as Nissay and Dai-ichi Life are implementing measures to compensate agents' income based on past sales performance due to the COVID-19 situation.

An industry insider said, "The key to managing insurance sales is how many agents with good performance are secured," adding, "We need to proactively consider measures to support agents whose livelihoods have become difficult due to the COVID-19 crisis."

This content was produced with the assistance of AI translation services.