"Declining Insurance Agents in Rural Areas, Consider Insurance Sales at Community Centers"

[Asia Economy Reporter Changhwan Lee] Due to the decrease in insurance agents in provincial areas, consumers' options for selecting insurance have significantly diminished, prompting calls for alternative measures such as insurance sales at community centers or the establishment of joint agency offices by insurance companies in provincial regions.

According to the Insurance Research Institute's report titled "Distribution and Implications of Exclusive Agents" released on the 30th, the number of exclusive agents at domestic life insurance companies decreased from 147,490 in 2010 to 112,780 in 2020.

By region, the decline was more pronounced in provincial areas than in the metropolitan area and large cities. Compared to 2010, the number of agents in the metropolitan area and large cities decreased to 82.7% and 84.3% respectively, while in provincial areas it plummeted to 49.1%.

The population per exclusive agent (P/C) nationwide was 336 in 2010, but due to the decrease in agents and population growth, it increased by 36.7% to 459 in 2020.

As of 2020, the P/C was 383 in the metropolitan area, 322 in large cities, and 1,115 in provincial areas, with provincial areas having a significantly higher P/C.

Although the population per agent was higher in provincial areas than in Seoul or the metropolitan area, the total income scale by region (I×P), reflecting population size, was significantly higher in Seoul and areas near large cities than in other regions, suggesting a high likelihood of agents continuously moving into urban areas, the report analyzed.

Senior Research Fellow Seokyoung Kim of the Insurance Research Institute stated, "It is estimated that the convenience of mobility has a greater impact on agents' sales activities than the market size of the region, and the decrease of agents in provincial areas will continue."

The report pointed out that the reduction of exclusive agent channels in provincial areas could create insurance-disadvantaged groups with limited product choices, emphasizing the need for measures such as activating online channels or utilizing existing nationwide organizational networks for insurance product sales.

It is expected that due to the decrease in insurance agents in provincial areas, cases where consumers cannot properly select insurance company products they desire will increase.

However, considering the aging population in rural and fishing villages, online channels have limitations, and organizations like post offices and Nonghyup, which still maintain organizational networks in provincial and rural areas, only sell their own insurance products, thus limiting consumer choice.

Therefore, it was emphasized that it is necessary to consider insurance product sales through organizations with nationwide networks such as community centers or convenience stores. Community center or convenience store employees should meet certain qualification requirements for insurance product sales, and plans for selling insurance products should be reviewed.

On the other hand, discussions among insurance companies for joint sales of insurance products in regions lacking sufficient insurance agents are also necessary.

Senior Research Fellow Kim said, "Insurance companies need to consider establishing joint insurance agency offices for geographically underserved groups," adding, "To prevent the emergence of insurance-disadvantaged groups due to geographic characteristics amid population aging and decline, multifaceted efforts by insurance companies are required."

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