Recently, regulatory authorities have issued fines one after another to severely crack down on the illegal behavior of "rebates"!
Sending refrigerators, gold and other valuables is not acceptable!
Send clients for physical examination? No way!
Four employees of a certain life insurance branch were punished for giving or promising to give refrigerators, gold and other property to policyholders when selling insurance!
Another life insurance center branch was punished for providing 43 VIP customers with a physical examination package worth 200 yuan each!
Supervision issued huge fines, and some people were banned from business for life!
According to the official website of the former China Banking and Insurance Regulatory Commission, the China Banking and Insurance Regulatory Commission fined a life insurance company 300,000 yuan because of illegal activities such as "rebate commission" by insurance agents. At the same time, the relevant responsible persons of the company were warned and fined 100,000 yuan each.
The administrative penalty decision showed that upon investigation, the insurance company had committed the following illegal acts:
From 2017 to August 2019, the insurance company provided overseas (overseas) physical examination services to some customers. Physical examination-related expenses included round-trip air tickets, accommodation, free travel, meals, etc., which was a provision of other benefits to policyholders, insureds, and beneficiaries other than those stipulated in the insurance contract.
During the period, 70 customers from the bancassurance channel participated in Japanese physical examinations, involving 86 insurance policies, with a physical examination fee of 2.7169 million yuan; 2 customers participated in Taiwanese physical examinations, involving 2 policies, with a physical examination fee of 59,600 yuan. From the personal insurance marketing channel, 5 customers participated in the physical examination in Taiwan, involving 10 insurance policies, and the physical examination fee was 154,000 yuan; 2 customers participated in the Japanese physical examination, involving 3 insurance policies, and the physical examination fee was 60,500 yuan. The then assistant to the general manager and head of the customer marketing department was directly responsible for the above-mentioned illegal acts.
In this regard, the China Banking and Insurance Regulatory Commission decided to impose the following administrative penalties: a fine of 300,000 yuan on the insurance company; in accordance with the provisions of Article 171 of the Law, the two relevant persons in charge were given a warning and each was fined 100,000 yuan.
"Give policyholders benefits other than those stipulated in the insurance contract" is commonly known in the industry as rebates or disguised rebates. This problem is a common violation in the insurance industry, and it can be said that it has been banned repeatedly.
According to incomplete statistics from Insurance With My Life, in the past few years, the national regulatory system has issued hundreds of various fines for the illegal situation of "giving policyholders benefits other than those agreed in the insurance contract." In 2022 alone, a total of nearly a hundred fines were issued, with fines ranging from thousands to tens of thousands of yuan.
The official website of Shanxi Banking and Insurance Regulatory Bureau once disclosed an administrative penalty decision:
Cao, a personal insurance agent of a Shanxi branch of a life insurance company, was banned from entering the insurance industry for life for promising to provide policyholders with benefits beyond what was stipulated in the insurance contract, deceiving policyholders and insureds, and concealing important information related to the insurance contract.
This time I was directly fined and banned from entering the insurance industry for life. This was the first time that I was punished with such a heavy penalty. This also demonstrates the determination of supervision to crack down on rebates, eliminate vicious competition, and safeguard the rights and interests of insurance consumers. It reflects the determination of supervision to rectify irregularities in marketing.
In the insurance industry, rebates can be said to be an open secret. In today’s fashionable terms, rebates are the involution of the insurance industry. To put it bluntly, it is vicious competition that disrupts the market order. Therefore, I have been with insurance all my life and believe that rebates have become a fatal cancer in the insurance industry and it is time to eradicate it.
In fact, in recent years, supervision has focused on illegal phenomena such as "giving policyholders benefits other than those stipulated in the insurance contract", "deceiving policyholders and insureds", and "concealing important information in insurance contracts".
Last year, the official website of the China Banking and Insurance Regulatory Commission also announced the penalties for such commission rebates:
A certain An Life salesperson was fined 1,000 yuan for giving hot pot to a customer during the insurance application process;
A Chinese Life salesperson was fined 1,000 yuan for giving a water purifier to a customer during the insurance application process.
The phenomenon of a large number of rebates makes people ignore their own protection needs and product functions when buying insurance, and blindly fall into the comparison of rebates.
So if we are smart and think that the products of various insurance companies are similar, in order to return a little commission, we choose an unprofessional agent and start hastily. Then it is very likely that you will be blinded by the returned commission and make a very irrational purchasing decision.
What’s more serious is that rebate itself is an illegal act.
Article 131 of my country’s current Insurance Law stipulates: Insurance agents, insurance brokers and their employees shall not engage in the following conduct when handling insurance business activities: granting or promising to grant benefits other than those stipulated in the insurance contract to the policy holder, the insured or the beneficiary.
An insurance agent also said that in order to get customers to pay the bill or to avoid being snatched away by others, agents will directly return part of their personal commissions to customers in the form of gifts, travel or cash. This behavior is very common in the insurance industry.
As the saying goes: "Money can make the world go round." However, unreasonable distribution of "interests" often breeds greater greed.
Driven by commissions, in order to obtain more income, some insurance marketers attract consumers by "giving premium rebates to policyholders other than those stipulated in the insurance contract", or obtain improper benefits through "long-term insurance and short-term insurance" and "false business". From the perspective of Insurance Is My Life, more and more misleading sales have made the insurance industry, a large market with tens of millions of people, become chaotic.
The video below is a wonderful conversation between Bian Hongqi and a beautiful colleague in the TV series "The Story of Bian Hongqi" when she rejected a customer's request for a commission rebate.
Click the video↓↓↓
Is the scene in the video very familiar to insurance salespeople? In order to improve performance, insurance salespeople sometimes ask customers for rebates, and some customers take the initiative to ask for rebates. No matter what the situation, this is a very dangerous thing.
Wang Guojun, a professor at the School of Insurance at the University of International Business and Economics, said that commission rebates are a vicious competition method adopted by individual agents for sales performance. They are repeatedly banned because agents who do this can indeed gain certain competitive advantages in the short term or achieve a specific purpose, but it is very detrimental to industry development and the reputation of the insurance industry. Therefore, regulatory authorities have also increased penalties for rebates.
Don't touch the red line of "rebate". A small fine is a small matter. In serious cases, it may involve a crime, and you will regret it later.
Commission rebate is a lose-lose behavior
1. Service discounts
Insurance is not a "one-and-done deal" that can be bought and sold in a casino, because life insurance policies are usually valid for more than 10 years. The purchase of the policy is only the first step. The agent's services will accompany the policy for its "lifetime", including policy annual inspections, policy renewals, claims consultation and a series of services.
You have taken away the commissions that people depend on for survival. It would be weird if you don't leave. Think about it, if you work in a company and your boss says: I give you half of your salary every month, will you continue to work?
When you go to the hospital to see a doctor, will you ask the doctor to give you a discount on your medical bills? If you go to the bank and deposit 1,000 yuan, will the staff give you 500 yuan back? If you get into an accident and your claim is discounted because you don’t have professional guidance, do you think you’re getting a good deal?
2. Discounts on insurance products
Each insurance salesperson brings not only products, but also different family protection solutions. Insurance has been with me all my life. I believe that the process of buying insurance is the process of choosing a plan. Choose whichever price is close to your expectations and which type of insurance is suitable.
However, "rebate" takes advantage of human nature's inherent tendency to take advantage and blurs the focus of what should be paid attention to when buying insurance. The customer's original intention is to "choose a plan", but the focus has shifted to "how much advantage can be obtained".
Customers can originally choose the product that best suits them. With benefits other than insurance, they may choose products that "seem to be the cheapest". This goes against the original intention of rational insurance planning and is not good for customers.
3. How can agents survive if they have no money?
Commissions are the bread and butter of an insurance agent’s life. He will provide customers with high-quality services, and the quality of services will improve as his abilities improve. Services are meant to be rewarded.
The income of insurance salespeople mainly comes from commissions. They also have to eat, refuel their cars, develop customers, and spend time and energy to do this job. Commissions support them to continue doing it.
If all commissions were given to customers, they would not be able to survive. If you work in a job and all your salary is given to the person being served and you get nothing, how can you stick to this job? Once you leave your job, who will service your policy?
Therefore, commission sales are tantamount to digging one's own grave, showing only nihilistic prosperity, or even more serious, like the reflection of a dying person. He seemed to be in good spirits, but in reality he was already dead.
Experts pointed out: "Agents who recruit customers on the basis of commission rebates cannot choose, because rebates are not allowed by insurance companies and are only private transactions between agents and customers. Agents who ask for commission rebates are mostly because their performance is poor and they are eager for success, so they use this as a way to deal with assessments."
At the end, the insurance industry has only been in my country for a few decades. Compared with the hundreds of years of history in Europe and the United States, there is indeed a big gap. This requires the joint efforts of domestic insurance companies, insurance practitioners and insurance consumers to make this industry more standardized and better. It is not an empty talk that insurance makes life better.
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