has the reduction in insurance agent staff hit bottom?
2024-09-20
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in recent years, with the transformation and development of personal insurance business, the decline in the number of insurance agent channels has attracted attention from all parties. is this downward trend still continuing? what is the effect of the transformation of the personal insurance sales team?
we can find out from the semi-annual report data of listed insurance companies recently disclosed. according to statistics, as of the end of the second quarter of 2024, the total number of agents of the six life insurance companies, china life, ping an life, taiping life, cpic life, new china life, and picc life, was 1.6006 million, a decrease of 57,900 compared with the end of 2023, and the rate of reduction has gradually slowed down.
industry insiders believe that the work of "clearing up" the individual insurance channels of life insurance companies has achieved remarkable results, and the next stage will focus on building a team of high-performing agents. insurance companies generally implement the "recruitment" strategy to absorb high-quality talents, continuously optimize agent production capacity, and actively respond to the potential business development challenges brought about by the reduction of the scheduled interest rate of life insurance products and the "integration of insurance and insurance".
life insurance companies' individual insurance manpower decline narrowed
high-quality talents are the core driving force for the development of enterprises. as one of the main sales channels of life insurance companies, the individual insurance channel is still the largest source of premiums for life insurance companies.
in the first half of this year, china life's individual insurance sales force was 629,000, a decrease of only 0.8% from the end of 2023. ping an life's individual insurance agents were 340,000, a decrease of 7,000 from the end of last year, a decrease of about 2.02%. the number of agents of taiping life, cpic life insurance, and picc life insurance were 227,600, 183,000, and 82,000, respectively, with a single-digit decrease. xinhua insurance's agents fell by 10.32% from the end of last year to 139,000, the largest drop among the six companies.
in recent years, the "cleaning up" of insurance companies' agent teams has continued to advance. data shows that at the end of 2023, the total number of individual insurance sales agents in my country's life insurance companies was 2.8134 million, a year-on-year decrease of 17.31%. compared with 2019, the number of agents has decreased by more than 6.3 million.
however, judging from the trend of human resource changes in listed insurance companies, from the end of 2023 to the first half of this year, the number of agents of the life insurance companies of six listed insurance companies decreased by 57,900; while from the end of 2022 to the end of 2023, the number of agents decreased by 381,000, and the decline showed a clear narrowing trend.
industry insiders pointed out that the previous substantial reduction in the size of agents was, on the one hand, an inevitable requirement for the high-quality development of the insurance industry; on the other hand, it was an active choice made by insurance institutions under market demand. the insurance industry's extensive business development model of "large inflows and outflows" is gone forever, and it has shifted to the refined development of business driven by human capacity. however, the transformation of the agent team is by no means simply to reduce the scale, but to create a truly efficient team, increase the proportion of core manpower, and optimize the team structure. this is also the key reason why the size of agents began to show signs of stabilization in the first half of the year.
“get rid of the old and bring in the new” to improve quality and efficiency
the number of agents has been reduced, and the quality has been improved. it has long been an industry consensus that agents should develop towards elite and high-productivity. life insurance companies regard the construction of a high-quality agent team as the key to their own transformation and breakthrough, and do their best to implement the strategy of cultivating and training agents to achieve the goal of improving quality and efficiency.
in the past two years, major insurance companies have launched "recruitment" plans while "clearing" their manpower, mainly targeting the high-end agent field to attract talents. for example, ping an life insurance launched the high-end agent brand "ping an mvp", namely "ping an's most valuable insurance agent" in june last year, striving to build an agent team with excellent performance, good business quality and high professional level. at the end of 2023, china life insurance launched the "seed plan" to pilot the joining of financial insurance planner teams in 24 cities. in 2024, taikang insurance's new high-performing team health wealth planner (hwp) plan will enter the fast lane of development, providing customers with comprehensive services covering insurance sales, health care, and financial planning.
from the practical effect, the average monthly performance rate of xinhua insurance in the first half of the year was 12.5%, an increase of 2.3 percentage points year-on-year, and the average monthly per capita comprehensive production capacity was 10,400 yuan, an increase of 28.3% year-on-year. in the first half of 2024, the average monthly performance rate of insurance salesmen of tai ping life insurance was 73.8%, an increase of 4.1 percentage points year-on-year; the average monthly first-year premium of core personnel was 64,600 yuan, an increase of 10.6% year-on-year. in its semi-annual report, picc life insurance pointed out that the average monthly effective manpower in the first half of the year was 23,322, an increase of 4.9% year-on-year, and the average monthly new single premium was 14,457.71 yuan, an increase of 8.2% year-on-year. taikang insurance's hwp recruitment results in the first half of the year showed that the team's academic structure was further optimized, with more than 300 doctors and masters, more than 1,500 people from domestic double first-class universities and top overseas universities, and most of the talents came from construction, real estate, education, finance, medical and health industries, and the total manpower has exceeded 20,000.
according to another industry exchange data, the average productivity of life insurance company agents has increased in 2023. the average new order productivity per person in the individual insurance channel is 130,100 yuan/person, an increase of 46,900 yuan/person year-on-year; the 13-month retention rate of individual insurance salesmen is 30.2%, an increase of 4.69 percentage points year-on-year.
in the view of zhou weidong, director of team development department of ping an life, the core of high-quality development is to provide customers with high-quality products and services, and high-quality services rely on a high-quality agent team. under this goal, professionalism, specialization and providing valuable services to customers have become the transformation direction of agents, and building a "three highs" team with high quality, high performance and high quality is an inevitable choice.
huang dazhi, a researcher at xingtu financial research institute, believes that whether from the perspective of the industry's hierarchical management of insurance agents or the insurance companies' own transformation needs, higher requirements are placed on the professional quality of insurance agents, which will inevitably eliminate some people with low professional quality. in the future, the insurance agent industry may shift from the simplest product sales to the professional and comprehensive direction of providing wealth management and risk management.
agents face dual challenges in business development
although the current scale of the individual insurance agent channel has stabilized and the downward trend has narrowed, agents still face uncertain challenges in business development due to the influence of the industry environment of lower guaranteed interest rates for life insurance products and the deepening implementation of the "integration of reporting and banking."
as we all know, in order to reduce liability costs, the regulatory authorities have required the industry to strictly implement the "reporting and bank integration" policy since last year, which means that the product fees reported by insurance companies to the regulatory authorities must be consistent with the actual fees. the "reporting and bank integration" policy first restricts the commissions of bank insurance channels, and is gradually being implemented in "all channels" such as personal agents and agency channels.
in addition, as market interest rates continue to fall, in order to effectively prevent interest rate risk, in august this year, the financial regulatory administration issued the "notice on improving the pricing mechanism of life insurance products", requiring that from september 1, 2024, the upper limit of the scheduled interest rate for newly registered ordinary insurance products will be 2.5%; from october 1, 2024, the upper limit of the scheduled interest rate for newly registered dividend insurance products will be 2.0%.
regarding the impact of policy changes, bai kai, vice president of china life, said that the life insurance individual insurance channel is the insurance company's own sales team, and its autonomy and controllability are stronger than the bancassurance channel. the implementation of "reporting and banking integration" coupled with factors such as the reduction of the scheduled interest rate will reduce the benefits of the policy to a certain extent. the market needs a process of acceptance, and the sales team also needs a process of training. in the short term, there will be some fluctuations in premiums, but in the long run the impact will not be significant. the company is still steadily advancing the development of various channel businesses according to the established strategy.
"it will be a general trend for the individual insurance channel to be integrated with insurance companies." wang lianwen, vice president of new china life, believes that when the entire industry reduces commission rates at the same time, as long as the team's production capacity and sales volume increase, the team's income decline can be offset in the short term. therefore, it is still necessary to improve the competitiveness of products to improve the team's sales level, promote sales growth, and achieve a win-win situation for customers, companies, and teams.
a research report released by cicc securities believes that in the long run, the huge and stable investment demand of chinese residents provides a broad space for the growth of new policies of listed insurance companies. combined with the improvement of per capita production capacity of the agent channel, the reduction of the drag of the team size and the improvement of the value contribution capacity of the bank-insurance channel, the new policy premiums of listed insurance companies are expected to increase in quantity and quality in the long run, and the steady growth of the value of new business is expected.
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