Insurance Commission (IC) has institutionalized the remote selling of life and non-life insurance. Due to the COVID-19 pandemic, the selling of insurance products remotely was only temporarily allowed previously.
Insurance Commissioner Dennis Funa in his circular letter last November 26, 2020, said that the commission recognizes the need and benefits derived from remote selling. IC recognizes the policy of the government to increase insurance penetration in the country during this crisis.
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What is Remote Selling?
Remote selling of life insurance is a collective term for selling existing insurance products using information and communication technologies. It includes teleconferencing, video conferencing, computer conferencing, audio conferencing, or other remote communication technologies.
What are the benefits?
This improvement from IC will benefit the commission, insurance companies, and especially the clients. So here are the few benefits of remote selling.
- It will significantly expand the territorial reach of financial advisors. Thus, increasing their sales capacity.
- It promotes cost efficiency as meetings can be done online.
- Most importantly, it will save so much time considering that travel time will be removed from the equation.
What are the limitations?
While remote selling is now considered a permanent way of selling insurance products, we still have a few things to observe.
Premium limits for telemarketing
Selling life insurance products via SMS and direct marketing through email and publication by print, radio, or television will not require face-to-face meetings with the client. However, the premium payable should not exceed Php50,000 or Php 125,000 for a single premium.
No cross-border selling
While remote selling is allowed and increased advisors’ territorial reach, cross-border selling is still not allowed. It means that insurance plans should only be sold within the Philippines.
Insurers and their sales personnel must observe anti-money laundering requirements.
Quality of Sales Process
The insurers must ensure that sales proposals and illustrations are thoroughly presented, explained, and discussed to the prospective client’s satisfactory understanding.
This circular letter takes effect immediately.
Federico is an electronics engineer, financial blogger, insurance agent, and a certified investment solicitor. A multi-awarded financial advisor with clients ranging from lawyers, doctors, engineers, accountants, business owners, company directors, and OFWs to minimum wage earners had sought advice from him in achieving lifetime financial freedom.