How trustworthy is your Insurance Agent?

An insurance agent is considered the least trustworthy in the sales chain of insurance policy across different segments among the financially literate as well as non-literate consumers, according to a study.

In the Assocham study, 72 per cent with no specific knowledge of insurance and finance in the age group of 18-60 years said their agent/sales person is the least trustworthy source when it comes to insurance policy sale.

The second is the insurer itself, though the percentage of respondents who believe so is much less at 29 per cent.

Misrepresentation of benefits remains an area of concern.

Among those covered, the financially-suave in the age group 25-40 years felt more let down, with 65 per cent of them facing issues in this regard.

A good 43 per cent of the not-so-financially educated too encountered the problem of misrepresentation.

“There is a need for simplification of processes and procedures of insurers to take away the awe and fear of the common man on different products.

“Demystification of insurance concepts is a necessary requirement for people to take to this in a large way, particularly against the backdrop of low financial literacy,” Assocham Secretary-General DS Rawat said.

He suggested that the industry needs to hasten the process of insurance inclusion, pointing out that the product space is cluttered with a number of complex policies.

The study suggested that since the insurance agent or sales person is the face of the industry, it is of utmost importance that we select these ambassadors very cautiously.

“Right from spreading awareness to conducting the need analysis for a sale to servicing the customers’ request in time to explaining and supporting customers in times of claim, sales representative must do it,” the study added.

“The lack of information of our customers is what creates the disconnect. Once that is taken care of, all apprehensions will slowly begin to disappear.”