CFIC Introduction
Following the implementation of the "integration of newspapers and banks" in the bancassurance channel, the "integration of newspapers and banks" in the economic agency channel has also accelerated. Recently, there have been adjusted products back on the shelves. A number of insurance brokers said that on the whole, after the product adjustment, the handling fee has decreased to a certain extent, and the commission rate in the first year has been reduced by about 30%, and some products have been reduced by 50%.
"The adjusted products of the 'newspaper and bank integration' are being put on the shelves one after another, and almost all the new products have adopted the new commission rate, and there are not many products that have not adjusted the commission rate. Wang Hua (pseudonym), a broker of an insurance agency, told a reporter from China Securities Journal and China Securities Taurus.
Following the implementation of the "integration of newspapers and banks" in the bancassurance channel, the "integration of newspapers and banks" in the economic agency channel has also accelerated. The reporter learned from the investigation that the adjusted products have been put back on the shelves one after another recently. A number of insurance brokers said that on the whole, after the product adjustment, the handling fee has decreased to a certain extent, and the commission rate in the first year has been reduced by about 30%, and some products have been reduced by 50%.
The products have been adjusted and updated one after another
"Integration of newspapers and banks" means that insurance companies should strictly implement the insurance terms and insurance rates that have been filed. According to industry insiders, in recent years, the homogeneous competition in the life insurance industry has been serious, and the cost management of insurance companies is generally more extensive, resulting in the actual cost exceeding the level of product filing, and there is a situation of "inconsistent reporting". At present, the regulator has implemented the "integration of newspaper and banking" for the life insurance industry, and the bancassurance channel has taken the lead in implementing it, and some agency channel products that do not meet the regulatory requirements have been adjusted in the near future.
Li Yong, a senior insurance broker, told reporters that there are generally three ways for insurance companies to adjust their products: First, the product benefits remain unchanged and the commission is lowered, and the commission is discounted by about seven percent on the original basis; second, the commission is basically unchanged and the product interests are lowered; and the third is to adopt a compromise method, and the product benefits are partially reduced, and the commission is also lowered a little.
According to Wang Hua, the commission rate of different products has been reduced by different degrees in the first year. Overall, the reduction is around 30%, and the commission rate of some products is larger, reaching 50%. Ma Chao (pseudonym), a broker of another insurance agency, told reporters that the commission rate of new products has been reduced more, and the overall rate is 30%-50%.
The reporter combed through the information released by insurance agencies and insurance companies and found that since the beginning of this year, many insurance companies such as Dajia Life, Fosun Prudential Life Insurance, Junlong Life Insurance, Zhongyi Life Insurance, Tongfang Global Life Insurance, Aixin Life Insurance, and Xintai Life Insurance have been removed from the shelves and adjusted through agency channels, involving increased whole life insurance, pension insurance, dividend insurance and other products.
The reporter learned from the industry that at the beginning of this year, the Life Insurance Department of the State Administration of Financial Supervision issued the "Notice on Life Insurance Products in 2023". Among them, because the product design does not conform to the basic principle of "integration of newspaper and bank", the products of Sino-British Life Insurance, Xintai Life Insurance and Ping An Life Insurance have been named and notified by the regulator. The regulatory authorities require all companies to continue to do a good job in product backtracking as the starting point, combined with the actual operation, and timely control the deviation of actuarial assumptions or adjust the actuarial assumptions of products by stopping sales or re-reporting.
Forcing small and medium-sized insurance companies to transform
Industry insiders said that the implementation of the "integration of newspapers and banks" is mainly to help insurance companies prevent the risk of fee differences, help reduce the cost of insurance companies' liabilities, and ensure long-term steady development. Compared with small and medium-sized insurance companies that rely on agency channels, the impact is more obvious, and the top insurance companies may be more competitive.
"In the past, some small and medium-sized insurance companies had more radical product designs and relied on giving customers higher returns to gain market share, but after the 'integration of newspapers and banks', the product pricing of insurance companies converged, and small and medium-sized insurance companies no longer had the advantage, and large insurance companies may gain stronger competitiveness because of their brands and scale effects. Mark said that in the future, insurance companies can further explore on the basis of providing insurance products and seek development opportunities in subdivided fields, such as exploring the "insurance + health care" model.
Mao Yanhui, founder of Tasunyuan Actuarial Consulting Company and a member of the Institute of Actuaries, said that the "integration of newspapers and banks" will force some small and medium-sized insurance companies that have no competitive advantages to transform into product innovation and differentiated operations.
Protecting the rights and interests of insurance consumers
With the successive implementation of the "integration of newspapers and banks" in the bancassurance channel and the agency channel, industry insiders said that the follow-up supervision will continue to implement the "integration of newspapers and banks" in the individual insurance channel.
Zhang Zhichun, Chief Financial Officer of Ping An, said that promoting the "integration of newspapers and banks" is an inevitable requirement for the high-quality development of the life insurance industry. The company will adhere to the "integration of newspaper and banking", more effectively promote value management, and better protect the rights and interests of insurance consumers.
Cheng Yonghong, general manager of Taiping Life Insurance, said that bancassurance will be an important contribution channel to value growth this year and even next year. At present, the company has also made preparations for other lines to promote all the preparations for the "integration of newspapers and banks".
From the perspective of policyholders, many people in the industry believe that after the implementation of the "integration of newspapers and banks", the benefits of products to customers will be reduced in the short term, and the price of insurance products may rise, but in the long run, the "integration of newspapers and banks" is conducive to the steady operation of insurance companies, which will make the interests of policyholders more fully protected.
Source of this article: China Securities Journal
Author: Chen Lu
WeChat editor: Liu Sile
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