June 01, 2007 (LBO) – Sri Lanka’s insurance policy lapse rate is far too high and might mean the industry’s sales pitch is overenthusiastic, an international expert told a gathering of industry professionals in Colombo. Rudy Verrilli, consultant to the Life Insurance and Market Research Association (LIMRA) stressed the importance of “ethical selling” and of protecting reputation, both personal and industry.
“You have a 45 percent lapse rate. Why?” he asked at the National Forum for Life Insurance Advisors (NAFLIA) congress in which over 600 agents participated.
“You’re probably overselling. Clients cannot afford to buy the policies,” Verrilli said.
“You’re not acting honestly if you’re selling a product the client can’t afford and therefore allows to lapse.”
Verrilli, whose LIMRA International is a worldwide association providing research and consulting services to the industry, says insurance agents must win the trust of clients and added that a trusting relationship would ensure referrals.
“If you don’t get referrals there’s something wrong,” he said.
“Ethical selling is the foundation of a successful career. There are no grey areas it is either ethical or not ethical.”