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Despite diversifying sales channels through the Internet and home shopping networks, insurance companies in Korea still rely heavily on salespeople, or life planners.
Fierce competition to scout life planners with outstanding sales records has driven Metlife Korea to file a suit against AIA Life Insurance.
The local arm of the U.S. insurer recently filed a 15 billion won damages suit against AIA Life with the Seoul Central District Court for obstructing its sales by scouting a number of high-performing life planners.
“AIA Life launched an aggressive, organized campaign to entice Metlife’s life planners by promising sales branch heads bonuses amounting to nearly 2.5 times their annual salaries from March through August this year,” a Metlife official said.
“If the branch chief moves to another company, many of his staff go with him. AIA crossed the line by enticing the entire sales branch. They went beyond the acceptable extent of competition among rival companies.”
Metlife claimed that its highest-performing branch crumbled and sales were seriously undermined as almost all of the branch’s 160 sales staff moved to AIA Life.
AIA said its legal affairs team was dealing with the case, and that it was commonplace for life planners to move from company to company.
“Insurance salespeople are more like freelancers rather than employees; they are the firm’s partners. Some say we are ‘stealing’ life planners, but I believe the expression is inappropriate because life planners are always switching companies,” a spokesperson for AIA Life said.
“A select few are given performance-based incentives, and if they don’t meet the sales target, they have to return some of the incentives to AIA.”
AIA Life is being called the “black hole of life planners” in the industry as it added more than 500 salespeople, mostly from rival insurers, to its payroll this year.
The number of AIA’s life planners reached 6,000 by the end of 2007, but fell with the global financial crisis to around 2,500 last year.
Starting with the extensive scouting of life planners from ING Life early this year, AIA recently began luring more from Metlife.
By Kim So-hyun (sophie@heraldcorp.com)
Fierce competition to scout life planners with outstanding sales records has driven Metlife Korea to file a suit against AIA Life Insurance.
The local arm of the U.S. insurer recently filed a 15 billion won damages suit against AIA Life with the Seoul Central District Court for obstructing its sales by scouting a number of high-performing life planners.
“AIA Life launched an aggressive, organized campaign to entice Metlife’s life planners by promising sales branch heads bonuses amounting to nearly 2.5 times their annual salaries from March through August this year,” a Metlife official said.
“If the branch chief moves to another company, many of his staff go with him. AIA crossed the line by enticing the entire sales branch. They went beyond the acceptable extent of competition among rival companies.”
Metlife claimed that its highest-performing branch crumbled and sales were seriously undermined as almost all of the branch’s 160 sales staff moved to AIA Life.
AIA said its legal affairs team was dealing with the case, and that it was commonplace for life planners to move from company to company.
“Insurance salespeople are more like freelancers rather than employees; they are the firm’s partners. Some say we are ‘stealing’ life planners, but I believe the expression is inappropriate because life planners are always switching companies,” a spokesperson for AIA Life said.
“A select few are given performance-based incentives, and if they don’t meet the sales target, they have to return some of the incentives to AIA.”
AIA Life is being called the “black hole of life planners” in the industry as it added more than 500 salespeople, mostly from rival insurers, to its payroll this year.
The number of AIA’s life planners reached 6,000 by the end of 2007, but fell with the global financial crisis to around 2,500 last year.
Starting with the extensive scouting of life planners from ING Life early this year, AIA recently began luring more from Metlife.
By Kim So-hyun (sophie@heraldcorp.com)
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Articles by Korea Herald
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