BUYERS AND AGENTS:
Today we will discuss about the two important personalities which play a vital role in the process of insurance and to run the companies as well. These two are the buyers and agents. In a simpler way we can say that they have a bridge role between the company and the policy holders. The third one that we will discuss in detail is brokers which have also very important role in developing the insurance company. Due to their great importance they are now very common in the world’s poular insurance companies. We will study them and their roles in detail here.
The buyers are the persons or companies that buy the insurance from the company. It can be a person, school, society, organization, and company etc. depending on the category they hold.
For example, consider a person gets insured by an insurance company. Then he belongs to the category of individual and he can join the life insurance or another type depending on him but if a school, company or organization gets insured from an insurance company then it will be the property insurance or vehicle insurance. Now if there is any kind of loss in his property then the insurance company will provide all the funds to overcome the loss. If a person has insured himself in the category of life insurance then the company must give him security and protection from life losses. If he dies then the company will give funds and money to his family. If he faces any financial loss i.e. his property and house building destroys by the natural disaster then the company pays all the funds to neutralize all these effects happened to him. So we can conclude that there are also several types of buyers of insurance and they hold several categories.
Insurance companies sell their products through the following persons:
There is another personality that is a way to join the insured persons to the company. It is the major part of a company in advertising it to the public. Every insurance company has several types of agents that perform different tasks and handle different categories of insurance. In other words we can say that an agent is the representative of the buyers of an inssurance company. I will discuss a similar case with you as discussed above.
Consider a person is to be insured then he has no direct relation with the company and he first contacts with an agent and then agent helps him joining the company.
They are the most important intermediaries in an insurance company. All the agents follow the rules and regulations assigned by the insurance company and they have a task to guide and help the buyers.
The qualifications and disqualifications of an agent to be issued license of an agency are:
1: age of that person should be atleast 18 years.
2: that person should has passed 12th standard examination or equivalent qualification.
3: he should have taken a training of 50 hours in life or general insurance.
4: for the composite agency he should have completed 75 hours training in life or general insurance.
Independent intermediaries (Brokers):
A new person that stands next to the agent is a broker. It is basically known as independent financial advisor(IFA). As it is clear from its name that it has a specific task to help and guide the buyers. It is also a type of independent agent who independently works for more than one company that’s why it is called as independent agent. It works for many companies and definitely gets its commission. It advises the buyers to choose the right path and right category of insurance. It does not charge the buyer for these advices. These persons are selected by their abilities and are offered to work for several companies at the same time. A broker is a professional advisor that is registered and licensed by the company to give his professional advises to the clients.
In short it can be concluded that the agencies and brokage systems play a vital and major role in processing the insurance companies in developed and developing countries.
A very large and good sales activity called as direct sales activity (DSA) is referred to the direct process of distribution of insurance products. It is a very useful and modern way of distributing insurance products. Today world’s largest companies almost use this method and the major part of their company is run through this method. One can sell and buy any insurance product at any time and any place by this method because it is an online process. By using internet we can use this method easily. A big advantage of this method is that we have no need to pay extra credit to the agents. There is no role of agents or brokers in this method. The policy holders can directly contact to the company.