The contributions of insurance agencies to the private pension system (PPS) should be increased, with significant incentives and regulations provided to help agencies be more competent in the pension branch, said the Union of Chambers and Commodity Exchanges of Turkiye (TOBB) member of the board of directors Ozgur Yilmaz.
Mr Yilmaz said, “For the PPS to become widespread in our country and to direct people to savings, new products should be developed and the agencies’ interest in this branch should be established.”
PPS is a voluntary pension system, complementary to the mandatory social security system and is supported by state contributions.
Customers who buy pension plans are long-term customers of at least 10 years or more, reported Insurance Gazette, quoting Mr Yilmaz. These customers can work with the insurance agency that manages their savings and from whom they purchase insurance.
He said, “Thus, the agency can provide cross-selling. When customer satisfaction is ensured, the customer will work with the insurance agency both in the pension branch and in the insurance branch.
“As the largest distribution channel in the insurance industry, agencies have an indispensable importance as they give confidence to the insured and provide 24/7 service and support at the time of loss.”
He added, “We can see that the sector is constantly growing in branches such as traffic, motor insurance, fire and supplementary health, where the agency channel is strong, and the penetration rate is increasing day by day. Therefore, agency production should be increased in construction, industrial fire, agriculture and financial insurance and PPS, where the agency channel has a low share in production. To increase agency production in these branches, first of all, agencies should be trained, products that agents can sell should be developed, agencies should be supported financially, and unfair competition and practices between distribution channels should be prevented.”
The TOBB had since October 2022 included specialty branches in agency training courses planned with the Insurance Association of Turkiye (TSB), said Mr Yilmaz. For these courses, 80% of the tuition fee of TRY275 ($14.65) is covered by TOBB and TSB. M