I sold life and general insurance fulltime for two years from 1971 and was among the pioneer batch of agents when licensing was introduced by the Director General of Insurance.
Being young and lacking confidence and discipline to reach out to prospective customers, my sales were poor, and I could barely survive.
In 1973, I switched to working as a tourist guide and was among the pioneer batch when licensing was introduced by the Tourist Development Corporation in 1975.
From 1976, I was appointed maintenance manager in a company that was operating the largest fleet of tour buses, limousines and self-drive cars in the country. Under my charge was a vehicle controller, garage supervisor and a large team of mechanics, painters and cleaners.
In 1978, I was shown a copy of the motor tariff and immediately spotted an error. as the third-party premiums for ‘Hire &Drive’and‘Limousine Taxi’were switched by mistake.
As our self-drive fleet was much larger than chauffeur-drive and we would be paying lower premiums, I chose to keep quiet, but it did not take long for the error to be corrected.
Sadly, the motor tariff was one dinosaur that survived until the first phase of the liberalisation of motor and fire tariff was introduced on July 1 2016.
My knowledge of insurance came in handy working in the travel industry for over 45 years, as I managed to set up many tours, travel and car rental companies from scratch.
The new staff I recruited may lack industry experience, but they would be so well trained that they could run the business on their own within a short time, and I would leave to set up anothercompany.
The businesses I set up were subsidiaries of large corporations, and most were served by insurance brokers. Instead of getting expert advice from two brokers, one based in Singapore and the other in Kuala Lumpur, I had to point out their flawed recommendations.
Likewise, many Malaysians, including travel industry personnel have a poor grasp of insurance. It is common to hear the ignorant equivaling insurance as cheating. But it is not difficult to understand how insurance works.
Say for example if there are many peoplequalified to be insured under similar risks. The amount they need to pay, called premiums, would commensurate with the sum they wish to be insured, which is called sum insured.
Insurance companies have actuaries, who are experts in calculating premiums based on risks. In any case, the total premiums collected must be enough to pay out all claims, cover administration costs and leave a profit to justify doing the business.
In other words, the majority of those who have paid insurance premiums would not get their money back. It is the same for the basic term assurance cover in life insurance. But most people would rather pay higher premiums for whole life policies to get some money back, and those opting shorter terms would get back a lot more, albeit lesser sum insured.
While it is good to have keyman life insurance for all partners in travel or tour companies, attention should first be given to general insurance, as an insured and an agent.
It is well-known that fire insurance is a must for buildings. Those who own mortgaged properties will receive notice from banks to renew the fire insurance annually. But few people insure household items for fire or burglary.
As for the office, it is more convenient for travel and tour companies to opt for an insurance package customised for small and medium enterprises that includes a host of covers that a layman never thought of.
The concept is like a tour package, which has been carefully planned to ensure holidaymakers enjoy a hassle-free vacation and making full use of the time and opportunities available at the destination, whereas those who make their own arrangements may encounter unforeseen problems.
For travel and tour companies to sell general insurance, one of thestaffs must have a professional certificate from the Malaysian Insurance Institute. It is a good idea for all sales staff to study general insurance online for additional knowledge, and it is not difficult to pass the exams and qualify as a professional.
This would open up a whole new world as selling travel insurance could lead to many other types of personal and business covers needed by their clients.Apart from generatinggood income, customers too would be better served.
On the other hand, travel agents that shy away and do not advocate insurance covers are actually doing a great disservice to their customers, particularly for those travelling overseas, as they may not receive medical care without proof of being able to pay.
