Current Science

Open Access Open Access  Restricted Access Subscription Access

Attrition of Agents in Indian Life Insurance Companies


Affiliations
1 Department of Finance, Narsee Monjee Institute of Management Studies, Bengaluru - 560083, India
2 Department of Economics, Nirma University, Ahmedabad - 382470, India
 

The insurance industry in India is primarily human-intensive, and the business is managed by a large number of agents or advisors. This article identifies the factors responsible for attrition of individual agents of life insurance companies in India and explores its implications for these companies. The study draws and builds on findings from the primary survey of individual agents and senior officials of public and private life insurance companies in the country. The article posits fuzzy logic theory to estimate the attrition index. Some of the mitigation measures of agent attrition are proposed, which provide an initial assessment of the extent to which these can be applied in the Indian context.

Keywords

Agents, Attrition Index, Fuzzy Logic Approach, Innovative Conceptual Framework, Life Insurance Companies.
User
Notifications
Font Size

  • Ernst & Young, Insurance industry challenges, reforms and realignment. A report submitted to Confederation of Indian Industry, 2011.

  • Verma, S., Vij, P. and Gopal, R., Study of attrition of sales force in life insurance sector. IOSR-J. Business Manage., 2010, 18, 58–66.

  • Patnayak, N., Now, agents can shift from one insurer to another. Cafe Mutual, 2016.

  • Bashir, S. I., Madhavaiah, C. and Naik, J. R. K., Critical analysis of traditional and modern insurance distribution channels in India. J. Insur. Inst. India, 2013, 9, 59–68.

  • Indian Regulatory Development Authority, Annual Report 2013– 14, 2014.

  • Indian Regulatory Development Authority, Annual Report 2014– 15, 2015.

  • Zhenhai, Z., Analysis of life insurance agent commission. Insur. Stud., 2003, 1, 58–59.

  • Qian, L., Empirical research on the importance of incentive factors to life insurance agents. In International Conference on Computer Design and Applications, 2010, vol. 5, pp. 38–41.

  • Luo, K., Optimal form and deadline for paying insurance agents their commission. In International Conference on Future Information Technology and Management Engineering, 2010, pp. 115–118.

  • Ernst & Young, Americans voice of the customer. Time for insurers to rethink their relationships. Global Consumer Insurance Survey, 2012.

  • Anagol, S., Cole, S. and Sarkar, S., Understanding the incentives of Commissions Motivated Agents: Theory and Evidence from Indian Life Insurance, A working paper in Harvard Business School, 2011, 12–055.

  • Pathak, S. and Tripathi, V., Sales force turnover: an exploratory study of the Indian insurance sector. Management, 2010, 5, 3–19.

  • Guthrie, J. T., Wigfield, A. and VonSecker, C., Effects of Integrated instruction on motivation and strategy use in reading. J. Educ. Psychol., 2000, 29, 331–341.

  • Mitra, S. and Ghosh, A. K., A study on effect of attrition over financial performance of the companies in life insurance sector in India. In National Conference on Emerging Challenges for Sustainable Business, IIT Roorkee, 2012, pp. 731–749.

  • Das, V. T. and Vijayalakshmi, C., Employee attrition and retention in life insurance sector: an empirical study. Indian J. Res., 2015, 4, 79–85.

  • Sanjeev, G. M., Bankers’ perceptions on causes of bad loans in banks. J. Manage. Res., 1997, 7, 40–46.

  • Mony, S. V., New initiatives in the insurance sector: opportunities and challenges. Vikalpapa, 2005, 30, 102–105.

  • Kumar, R.. Research Methodology – A Step by Step for Beginners, Addison Wesley Longman Australia Pvt Ltd, 1999.

  • Reporters, B. S., IRDA sets minimum targets for agents. Business Standards, 2010.

  • Soni, B. K., A study on pre-merger and post merger/acquisition selected financial parameters for selected cement companies in India. SIES J. Manage., 2014, 10(2), 3–13.

  • Kumar, V. and Schuhmacher, M., Fuzzy uncertainty analysis in system modelling. Comput. Aid. Chem. Eng., 2005, 20, 391–396.

  • Cheung, W. M. and Kaymak, U., A fuzzy logic based trading system. Econometr. J. Rotterdam, 2008, 8, 33–45.

  • Kucukali, S., Risk assessment of river-type hydropower plants using fuzzy logic approach. Energ. Policy, 2011, 39, 6683–6688.

  • Roy, N. and Roy, N. G., Risk assessment and distribution in small hydro power projects: a fuzzy. AIMS Int., 2015, 7, 1409–1415.

  • Mannar, B. R., The Indian market scenario of insurance sector. Asia Pac. J. Res., 2015, I, 88–98.

  • Chowdhury, M. K., Rise and growth of insurance sector in preand post-liberalised India. Int. J. Emerg. Res. Manage. Technol., 2016, 5, 23–33.

  • Klapper, L., Lusardi, A. and Oudheusden, P., Financial literacy around the world, A report by The Standard and Poor's Rating Service Global Financial Literacy Survey, 2014.

  • Onkareppa, R., Non-performing assets management in commercial banks: reasons, consequences and initiatives. Int. J. Market. Technol., 2013, 3, 62–77.


Abstract Views: 306

PDF Views: 87




  • Attrition of Agents in Indian Life Insurance Companies

Abstract Views: 306  |  PDF Views: 87

Authors

Neha Chhabra Roy
Department of Finance, Narsee Monjee Institute of Management Studies, Bengaluru - 560083, India
Samik Shome
Department of Economics, Nirma University, Ahmedabad - 382470, India

Abstract


The insurance industry in India is primarily human-intensive, and the business is managed by a large number of agents or advisors. This article identifies the factors responsible for attrition of individual agents of life insurance companies in India and explores its implications for these companies. The study draws and builds on findings from the primary survey of individual agents and senior officials of public and private life insurance companies in the country. The article posits fuzzy logic theory to estimate the attrition index. Some of the mitigation measures of agent attrition are proposed, which provide an initial assessment of the extent to which these can be applied in the Indian context.

Keywords


Agents, Attrition Index, Fuzzy Logic Approach, Innovative Conceptual Framework, Life Insurance Companies.

References





DOI: https://doi.org/10.18520/cs%2Fv115%2Fi5%2F851-859