AIA Group has given the green light to AIA Thailand to recruit another 10,000 agents over the remainder of the year amid fierce competition in bancassurance.
The US-based group is satisfied with the performance of the Thai unit despite the effects of last year’s devastating floods, as premiums through the agency channel have steadily contributed to the company, Sataya Tepbunterng, general manager of AIA Thailand, said yesterday.
AIA Thailand has 62,000 agents nationwide, of which 21,000 are active. With the local unit accounting for one-fourth of the assets and revenue of AIA Group’s operations in 15 Asia-Pacific countries, the group is attaching increased importance to its performance.
Sataya said agencies remained the most important sales outlet for AIA Thailand, even though they have been outpaced in the market by bancassurance, with banks giving greater focus to the recruitment of single-licence brokers that can sell investment instruments.
In light of the intense competition from bancassurance, the company is now making it a priority to recruit quality agents and upgrade existing agents to become single-licence entities, so that they can sell both unit-linked insurance plans and universal life-insurance plans, he said.
AIA Thailand at the moment has 1,200 single-licence agents.
With the growth rate of single-licence brokers at banks better than that among insurers, the group has earmarked a large budget to AIA Thailand for the recruitment of quality agents, he added.
While AIA has banking partners to sell its insurance products, those banks also sell the products of many insurers. Moreover, the margin from premiums via bancassurance is narrow, and customers referred by banks might not be as loyal as those attracted through the agency channel, the general manager said.
Apart from employing new agents, the company is offering incentives to high-level agents to help build up a force of new active agents. AIA Thailand targets increasing the number of active agents to 25,000 this year.
A full-time agent should be able to generate eight new policies per month, against the current average of four. However, it is not easy get agents to dedicate themselves full-time to selling insurance, he said.
To help its agents, the company has to develop attractive products such as the recently launched AIA Health Lifetime, Sataya said.
AIA Thailand has raised the premium target for Health Lifetime, because the premiums received within a month of the product’s launch was Bt88 million, more than double the target of Bt40 million.
The company is now targeting Health Lifetime premiums this year to come in at Bt600 million, against the previously expected total of Bt320 million, Sataya said.
First-year premiums from agencies account for 85-90 per cent of AIA Thailand’s overall FYP. The company expects FYP from agency distribution this year will rise to between Bt13 billion and Bt15 billion, from the Bt12 billion generated last year.
AIA Thailand is confident it can achieve the target, unless there is a resumption of political instability.
The group has increased its awareness of the political situation in Thailand after seeing the growing dispute over controversial reconciliation measures and the resumption of street rallies, he said.