After almost three years, job opportunities for agents in the life insurance industry are increasing again.
“There has been a noticeable increase in agent hiring in the industry,” T. S. Vijayan, Chairman, Insurance Regulatory and Development Authority (IRDA), told Business Line here.
The increase in recruitment is driven by the growth being witnessed in the life insurance business after a continuous slide since September 2010 when the new regulatory regime for unit-linked insurance plans hit the industry hard resulting in a massive downsizing, especially by the private insurers.
As per Life Insurance Council data, there were 21.25 lakh agents in 2012-13 compared to 23.45 lakh in the previous year.
The peak was 29 lakh in 2010 after which their number steadily declined. Now that the hiring has begun again, it remains to be seen how long it takes to reach that level.
According to the insurance regulator, the life insurance segment should be growing by about 10 per cent in the current financial year.Aping LIC
This apart, there is a greater realisation that an agent-led distribution model was ideal for traditional life insurance products, which have a bigger share in the market now. Some private insurers are now trying to repeat what Life Insurance Corporation had done, that is, capture the rural market through agents.
“The recruitment of agents has gone up in general and termination of existing agents has been arrested,” A. K. Sahoo, Executive Director, Life Insurance Corporation, said. “We have demonstrated the success story with agents and naturally others are looking at it,” he added.
LIC recruits about two lakh agents every year.
According to Anup Rau, Chief Executive Officer, Reliance Life Insurance, his company firmly believes in an agent-led growth model and never stopped hiring them even when the industry was down.
There are other factors that have come timely. “The agent recruitment exam norms were relaxed by the Insurance Regulatory and Development Authority recently and that has given greater scope for companies in recruitment,” said Alok Roongta, Chief Financial Officer, Bharti AXA Life Insurance.
“We are now recruiting 800-900 agents every month,” he added.
An active life insurance agent generally earns a minimum of Rs 15,000-20,000 a month.
The commission would be paid through the tenure of the policy after a regular payment of premium for five years.