Many insurance agents can be rich, but most of them quit the industry and lose most of the friends. I think insurance is not an evil, there are some hints that help to become an ethical and successful agent:
1. Sell suitable products
If the customer is poor, don't sell too much insurance. The client may have financial problems that could not afford the insurance. Besides, the agent could build up reputation by not selling high commission insurance plan.
2. Make friends
Everyone knows it is important to make friends, but the main point is to let the friends trust you. I don't mean to pretend, but really be an honest person. "Concerning" a friend that haven't met for a long time is certainly dishonest. We should help others because of we wish but not for money.
3. Explain all the details
Many agents exaggerate the benefit of insurance. For example, they make the clients believe that they must claim in the future but actually many of the clients won't. Some make the clients believe that the insurance cover all the areas but actually many areas are not protected. The agent should explain all the details in order to make long term benefit.
Showing posts with label Insurance. Show all posts
Showing posts with label Insurance. Show all posts
Saturday, October 2, 2010
Thursday, September 23, 2010
Model of Religion
I think Christianity lasts for a long time has its own reason. We wound not discuss whether the reality of religion here, but the model of the church and religion. There are some forces which supports the religion even if the religion cannot be explained clearly.
First, Christians are more "positive" and so they are happier. They think that God has chosen the best path for them. Even if they face failure, they would think that God gives them chance to learn and improve. For failure, they may not care as much as others as they may be more concern about the life after death and religious life. The concept of the life after death also make Christians more "peaceful".
Second, Christians are well-organized. They have clear plan to donate money to church and promote their religion. They have regular gathering and sharing to strengthen their religion. They gain happiness from religion, so they want others to follow their religion. The more important thing is that, according to the Bible, all people go to hell if they don't believe in Jesus. Some Christians try their best to spread the religion.
Last, Christianity is about uncertainty. As human have limit in proving "super-natural" matter, Christians could defense their religion by ignoring any philosophical thinking. As the possibility of life after death exists, Christians could ignore any criticism. Therefore, Christians claims that the religion is "logical correct" as the religion lasts for long time.
The model is of religion is successful. Therefore, many business model adopt similar running method.
For example, insurance company teaches their agents that insurance is helping others with well-organized plan for promotion. People could not deny the use of insurance as uncertainty exist.
Another example is multi-level marketing. The people joining multi-level marketing are told that they could make big money so they are happy about that. The organization is well-organized for sharing "successful story" and recruiting new members. Other people could not deny the possibility of earning big money from multi-level marketing as the probability does exist.
First, Christians are more "positive" and so they are happier. They think that God has chosen the best path for them. Even if they face failure, they would think that God gives them chance to learn and improve. For failure, they may not care as much as others as they may be more concern about the life after death and religious life. The concept of the life after death also make Christians more "peaceful".
Second, Christians are well-organized. They have clear plan to donate money to church and promote their religion. They have regular gathering and sharing to strengthen their religion. They gain happiness from religion, so they want others to follow their religion. The more important thing is that, according to the Bible, all people go to hell if they don't believe in Jesus. Some Christians try their best to spread the religion.
Last, Christianity is about uncertainty. As human have limit in proving "super-natural" matter, Christians could defense their religion by ignoring any philosophical thinking. As the possibility of life after death exists, Christians could ignore any criticism. Therefore, Christians claims that the religion is "logical correct" as the religion lasts for long time.
The model is of religion is successful. Therefore, many business model adopt similar running method.
For example, insurance company teaches their agents that insurance is helping others with well-organized plan for promotion. People could not deny the use of insurance as uncertainty exist.
Another example is multi-level marketing. The people joining multi-level marketing are told that they could make big money so they are happy about that. The organization is well-organized for sharing "successful story" and recruiting new members. Other people could not deny the possibility of earning big money from multi-level marketing as the probability does exist.
Sunday, September 13, 2009
How Does Insurance Work?
How Does Insurance Work?
Insurance exists because risk exists. There is a possibility that anyone could become a victim of fire, theft, auto accidents, other injury accidents, illness, severe weather, lawsuits and more. We are subject to risk at home, at work, in our cars, traveling, in the hospital or anywhere at any time.
Transfer of Risk
Insurance cannot remove the risk or the likelihood that one might become a victim of any of these events, but what it does is transfer all or some of the financial impact of any of these events. Insurance exists to help individuals recover from the financial consequences of these events by pooling the resources of a large group to pay for the losses of a small group.
A Little Background About Insurance
Insurance has been around in some form since traders first began to travel over water to trade their goods. There is documented evidence that Chinese and Babylonian traders began to protect themselves against risk as far back as the 3rd century BC. Traders realized that if they spread their goods among multiple vessels, rather than putting all of their cargo on one vessel, they had a better chance of avoiding complete loss.
In later years, shippers in Great Britain reasoned that if 100 ship owners each chipped in money, if some of those ships were damaged or lost, the money collected from all 100 ships could be used to repair or replace the few. Extreme losses following the Great Fire of London in 1666 led to the creation of the world's first actual insurance company, The Insurance Office, or The Fire Office. And in the United States, the first insurance company was started in Charleston, South Carolina in 1732. Benjamin Franklin is recognized as helping to make insurance popular and to standardize the practice of insurance.
Law of Large Numbers
In order to afford to cover the financial losses of its customers, an insurance company needs a very large base of members. For each different type of loss that they insure against, insurance companies have years of statistics that help them calculate how many losses they are likely to have. They are counting on the law of large numbers which, when applied to insurance, states that the more members in an insured group, the more likely it is that the number of actual losses will be very close to the number of expected losses. This law also applies to gambling casinos.
Determining Premium Payments
The insurance premium that each member of the insured "pool" has to pay is different and is based on many factors. For life and health insurance, for example, the insured person's age is the most important factor. It is statistically provable that younger people have fewer claims for life and health (except for pregnancy and childbirth), so their insurance premiums will be lower than an older person or someone with health issues.
For car insurance, the driver's age, gender, geographic location, type of car and driving history all factor in to the amount they will have to pay for insurance coverage. Teenagers have to pay higher auto insurance rates because statistical history has proven that they have more accidents with higher losses than a 40 year old driver. The larger the pool of insureds, the more the risk is spread out, and the lower the premiums can be.
These same principles of transferring risk and the law of large numbers also apply to business insurance, liability insurance, accident insurance, specialty insurance and more. To illustrate, if 10,000 people each pay $1,000 a year for home, auto, health or any other type of insurance, the insurance company would receive $10 million dollars. If 500 members of this pool sustain losses during the year of $10,000 each, the pool would be large enough to pay all of their losses, $5 million, and still have $5 million for future claims.
So in order to remain viable, an insurance company needs at least 3 basic things:
* A large pool of insureds in a diverse demographic (age, gender, health, location, occupation, history)
* Reliable, current statistics on the probability of loss for each type of insurance offered
* Sufficient premium payments to cover the anticipated losses
source: http://www.superpages.com/supertips/how-does-insurance-work.html
Insurance exists because risk exists. There is a possibility that anyone could become a victim of fire, theft, auto accidents, other injury accidents, illness, severe weather, lawsuits and more. We are subject to risk at home, at work, in our cars, traveling, in the hospital or anywhere at any time.
Transfer of Risk
Insurance cannot remove the risk or the likelihood that one might become a victim of any of these events, but what it does is transfer all or some of the financial impact of any of these events. Insurance exists to help individuals recover from the financial consequences of these events by pooling the resources of a large group to pay for the losses of a small group.
A Little Background About Insurance
Insurance has been around in some form since traders first began to travel over water to trade their goods. There is documented evidence that Chinese and Babylonian traders began to protect themselves against risk as far back as the 3rd century BC. Traders realized that if they spread their goods among multiple vessels, rather than putting all of their cargo on one vessel, they had a better chance of avoiding complete loss.
In later years, shippers in Great Britain reasoned that if 100 ship owners each chipped in money, if some of those ships were damaged or lost, the money collected from all 100 ships could be used to repair or replace the few. Extreme losses following the Great Fire of London in 1666 led to the creation of the world's first actual insurance company, The Insurance Office, or The Fire Office. And in the United States, the first insurance company was started in Charleston, South Carolina in 1732. Benjamin Franklin is recognized as helping to make insurance popular and to standardize the practice of insurance.
Law of Large Numbers
In order to afford to cover the financial losses of its customers, an insurance company needs a very large base of members. For each different type of loss that they insure against, insurance companies have years of statistics that help them calculate how many losses they are likely to have. They are counting on the law of large numbers which, when applied to insurance, states that the more members in an insured group, the more likely it is that the number of actual losses will be very close to the number of expected losses. This law also applies to gambling casinos.
Determining Premium Payments
The insurance premium that each member of the insured "pool" has to pay is different and is based on many factors. For life and health insurance, for example, the insured person's age is the most important factor. It is statistically provable that younger people have fewer claims for life and health (except for pregnancy and childbirth), so their insurance premiums will be lower than an older person or someone with health issues.
For car insurance, the driver's age, gender, geographic location, type of car and driving history all factor in to the amount they will have to pay for insurance coverage. Teenagers have to pay higher auto insurance rates because statistical history has proven that they have more accidents with higher losses than a 40 year old driver. The larger the pool of insureds, the more the risk is spread out, and the lower the premiums can be.
These same principles of transferring risk and the law of large numbers also apply to business insurance, liability insurance, accident insurance, specialty insurance and more. To illustrate, if 10,000 people each pay $1,000 a year for home, auto, health or any other type of insurance, the insurance company would receive $10 million dollars. If 500 members of this pool sustain losses during the year of $10,000 each, the pool would be large enough to pay all of their losses, $5 million, and still have $5 million for future claims.
So in order to remain viable, an insurance company needs at least 3 basic things:
* A large pool of insureds in a diverse demographic (age, gender, health, location, occupation, history)
* Reliable, current statistics on the probability of loss for each type of insurance offered
* Sufficient premium payments to cover the anticipated losses
source: http://www.superpages.com/supertips/how-does-insurance-work.html
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