The Indian life insurance industry witnessed attrition of individual agents in the last calendar year following average growth and slowing of sales of policies.
The data from the Life Insurance Council shows that the industry had over 21.59 lakh individual agents as on December 2014, and the number declined to 20.43 lakh as on December 2015.
In order to tide over the tough times, insurers have changed the strategy of hiring large number of agents. Instead, they are taking the right kind of agents who are serious about selling insurance products.
“There is no point in hiring agents, who after some months switch to another insurance company to earn extra commission. It is always better to have dedicated people who can bring in extra value to our company,” said the CEO of a leading insurance company.
Private players such as Bajaj Allianz Life Insurance, Aviva Life, and Max Life, among others, have seen decline in the number of individual agents in the last calendar year compared with the previous year. On the other hand, insurers like Reliance Life, SBI Life, HDFC Life, Kotak Mahindra Life witnessed rise in the number of agents.
Arijit Basu, managing director and CEO at SBI Life, said, “We have deliberately brought down number of agents in the last few years. Our strategy has been to remove agents who were inactive or not contributing in the business, and focus on recruiting right kind of agents.”
Data from the Life Insurance Council shows that SBI Life had over 87,866 individual agents as on December 2015 and the company wants to it to go up to 90,000-93,000 by the end of current financial year.
While top private players added agents, state-run Life Insurance Corporation of India (LIC) has seen fall in the number of agents. The data says that LIC had 11.78 lakh individual agents as on December 2014, which came down to 10.76 lakh in December 2015.
At a recent conference, LIC chairman SK Roy said, “Attrition of agents is very specific to individual companies. Reduction of the number of agents is very internal decision of LIC. While we need to focus on growing number of agents, we need to focus on their productivity as well, and that is very key concern for us. People who are engaged in this industry as distributors of insurance should be in a position a certain amount of money out of this profession.”