Stop Harming Malaysian General Insurance Agents: No Unfair Rebates!

PIAM created a very uneven playing field by allowing insurance companies to give away a 10% discount to any insured or policyholder, but not allowing their agents to do so.

PIAM did this by amending ICAGIB Clause 5.3 On June 22nd 2009, by deleting the word 'members' from the clause which now reads:
"No agent or broker shall give to any insured or policyholder any discount or rebate whatsoever or any commission paid or payable or on any part of parts thereof, in respect of any insurance policy covering a motor risk rated under the Malaysian Motor Tariff."

Previously, even the insurance companies which in the above are referred to as 'members' cannot give discounts to policyholders - but by amending this clause - PIAM has allowed Etiqa, AIG, Kurnia, RHB Insurance to sell insurance directly to customers, at a 10% discount - and the rest of the companies will follow suit.

This has created a very uneven playing field - the motor insurance premiums contribute to 46.2% of the entire insurance market in Malaysia. This change in the ICAGIB terms has given the the insurance companies the option and privilege to undercut their agents if they choose to. Do take note that we, the agents, depend on our companies for lifelihood and income. We have given our effort, heart and soul to further both our own interests and also that of the companies'.

I have personally lost many clients that are willing to travel directly to the insurance company to renew with the insurance company to get this 10% discount. I would have gladly given back 5% of my commission to my customers as it would save them the hassle of going over to the insurance company. At the very least, I am still able to retain half of the commission which is rightfully mine. I represented my company in instilling a sense of loyalty in my customers' minds, and this is the way my company has decided to repay me - by allowing my customers to renew directly with them without paying me the commission that I deserve.

This uneven playing field has been taking its toll on me - both financially, mentally and psychologically. I believe it is the same for all general agents throughout Malaysia - as a majority of the premiums we bring to the company come from motor insurance.